I can appreciate both of your positions. The reality is American business has moved from a traditional model with balance sheet rich self funded projects to a debt ladden faster growth model. We have become the newly married couple with too much credit card debt and now it has to be paid off. Everyday businesses are asking me where they can get more money. What I am coming to realize is more money is just creating more problems.

Businesses need to change from financing todays operations on future earnings and start living within their means. If that means slower growth, then that is the trade off for stability. Lenders need to realize that they led businesses down this path by making it easier to get money than it was to fix real problems. We all share the blame, lenders and business people and we all will have a part in taking on these challenges.

To overcome these challenges will take major belt tightening by business owners and they may even have to give up a few personal assets to help get their business back in balance. From the lending side lenders need to understand that they are going to have to be more flexible in their terms going forward if they want hope of being paid their full balance. The government needs to accept that just because a bank is willing to adjust terms of a loan to help the borrower if you force the bank to reserve heavily against that debt you are forcing them to pay a penalty for doing the right thing. Maybe just maybe the Fed could use some of that #350 billion to insure restructured small business loans or maybe that is too much commonsense for politicans to get their minds around.

Government rules are only part of the problem, I have watched business owners cling to a personal asset until it was too late to save the business or the personal asset. I have seen lenders that were presented a new payment plan only to reject it out of hand and then be forced to accept half that amount in a chapter 11 plan.

What I really do on a daily basis is try to get these two sides to see that they both have the same goal, a successful business that pays it's debts. I will give this advice to business owners, don't wait until you are on the verge of missing a payroll or tax payment before you talk with you lender and don't keep telling them everything is fine when it is not. A blindsided lender is not going to be a good partner. To lenders I would say that in my experience your collateral is worth far less than you are owed so you need to be willing to work with borrowers and think "outside the box" for answers.

Any way you cut it we have a lot of work ahead of us.