August PayNet Index projects gains

10/3/2011

Thomson Reuters/PayNet, the small business lending index that predicts economic developments, provided some good news in a recent report, Reuters notes.

Typically, the Index can surmise economic changes by two-to-five months. So, given the fact that it gained 19 percent in August year-over-year, job seekers may finally be able to see the light at the end of the tunnel.

August's number represents an 8.6 percent increase from July and is at its highest point since April 2008.

PayNet typically tracks loans used to buy or update plants or equipment, and it looks as if small businesses are borrowing again to purchase new products to replace outdated machines.

"Any time you put in new plants and equipment, you've got to have people who sit in front of them - we will see some job growth," said PayNet founder Bill Phelan, as quoted by the news source.

Despite the projected positivity, the current lack of borrowing and high interest rates recently forced the Fed to sell $400 billion of its shorter-term securities to buy longer-term holdings, in an effort to jumpstart the economy, the Los Angeles Times reports.