Mike Mitternight knows a lot about the pain caused by the credit crunch.
No, he isn't some Wall Street banker. And no, he isn't a stock broker.
Mitternight owns a Louisiana air conditioning installation and service company that would seem completely removed from the turmoil in the stock market. But like countless other small-business owners across the country, Mitternight suffers from an economic crisis that started with mortgages, and now has rippled all the way down to his business.
The giant commercial air conditioners that Mitternight's company, Factory Service Agency Inc., installs cost up to $150,000. He doesn't have that type of cash just lying around.
Normally, the manufacturer sells him the equipment on credit. He then installs it on a construction site and bills the general contractor. Then, about 45 days later, a check comes for his work and he pays back the manufacturer.
"They all understood that this equipment was going to a construction project and the turnaround was going to be slow," he said.
But now with companies large and small tightening their lines of credit, Mitternight is getting hurt: The air conditioner manufacturers are no longer giving him a month or two to pay his bills.
That leaves him with two options: pressure his clients to pay him faster -- not something that is always possible -- or get a short-term loan, adding thousands of extra dollars to his operating expenses and cutting into his profits.
"The interest could be a couple thousand dollars, so you start eating quickly into that 15 percent markup that you had," Mitternight said.
Mitternight is not alone.
Think about the car dealer who buys new vehicles on credit, hoping to sell them fast. Or that clothing retailer who borrows to buy this season's latest fashions. They and thousands of other small businesses are struggling to obtain short-term loans for the most basic of business operations, including merchandise purchases and payroll.
"Small-business owners are feeling less confidant in nearly every way," National Small Business Association President Todd O. McCracken said in a statement. "Decreasing home values, a tight credit market, skyrocketing energy prices and failing financial institutions have led to 67 percent of small-business owners who believe that the U.S. economy is worse off today than it was five years ago."
President Bush addressed the pain felt by small-business owners twice this week, including a speech yesterday before leaders and employees at Guernsey Office Products, Inc., just outside of Washington, D.C.
The president said the government has taken steps to fix the economy, but added it is a "gradual process."
"Thawing the freeze in the financial system is not going to happen overnight, but it will be a process that unfolds over several stages," Bush said.
"You know, this is the best shot we got, and it's a big, bold move," he added. "I know that the days are dim right now for a lot of folks. But I firmly believe tomorrow is going to be brighter. And I thank you for having that resiliency and that -- and that drive to -- to hang in there and help this -- help this economy grow and recover."
Sen. Charles Schumer, D-N.Y., earlier this week called on the Bush administration to create a temporary small-business loan program to serve as a bridge until funds kick in from the $700 billion federal bailout for Wall Street banks.