Small Business Index Moved Up in September

One company’s index measuring U.S. small business activity moved up in September, both from its August level and year-over-year. Could this upward momentum last into the new year?

Newtek Business Services, which offers a range of business services and financial products to the small- and medium-sized business market, said that its SB Authority Index of small business indicators for September 2013 was up .72% from August 2013 and a big a 7.12% versus September 2013.

According to Newtek, the increase was gauged by factors like Newtek merchant processing rates, the Russell Microcap Index, and approved SBA loan volumes. What these gains indicate, according to Newtek CEO Barry Sloane, is that the Fed’s “easy money” policies are having the effect of driving stock prices higher, encouraging consumers to spend more and prompting banks to get more active in their lending to small business.

Will this last? So far, the Fed has been willing to extend its easy money policies. But it has indicated recently that an end to these policies will come at some time. The Fed is looking at the economy, with all the sluggish growth in jobs and wages, and has thus far determined that massive stimulus is still needed.

The recent good news we’ve seen in such areas as housing and small business activity may cause the Fed to take a different tack. It’s anyone’s guess.