Posted on 04/30/2017 7:38:09 AM PDT by george76
But don’t blame the oil bust.
Commercial bankruptcy filings, from corporations to sole proprietorships, spiked 28% in March from February, the largest month-to-month move in the data series of the American Bankruptcy Institute going back to 2012. They’re up 8% year-over-year. Over the past 24 months, they soared 37%! At 3,658, they’re at the highest level for any March since 2013.
Commercial bankruptcy filings skyrocketed during the Financial Crisis and peaked in March 2010 at 9,004. Then they fell sharply until they reached their low point in October 2015. November 2015 was the turning point, when for the first time since March 2010, commercial bankruptcy filings rose year-over-year.
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So now they blame brick-and-mortar retail which is in terminal decline, given the shift to online sales. I have reported extensively on the distress of the larger chain stores, but brick-and-mortar retailers include countless smaller operations and stores that no ratings agency follows because they’re too small and can’t issue bonds, and many of them are even more distressed.
Businesses file for bankruptcy protection because they have too much debt. Even brick-and-mortar retailers with little debt can get by just fine. Their sales might decline, and they might not make much money, but they can keep going. However, brick-and-mortar retailers with large amounts of debt are toast.
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The Fed’s monetary policies have purposefully encouraged businesses and consumers to borrow. But debt doesn’t just go away. It accumulates. By now, an increasing number of businesses and consumers are suffocating under this debt overhang in an economy that never developed the “escape velocity” needed
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the economic reality is tough for businesses and consumers struggling under the hangover from eight years of ultra-low interest rates.
(Excerpt) Read more at wolfstreet.com ...
It’s Bush’s fault.
Am epic bursting of many bubbles in coming
This is good. For 30 years we’ve heard we are a “consumer economy” and that all that has kept things afloat is consumer buying.
Well, things have changed. We are shifting rapidly into an “investor” economy (used to be called “supply side”). As debt is brought into line, productivity will soar.
Don’t think it’s a “bursting” nearly as much as a healthy realignment from consumption to production.
Money-from-thin-air, the tree of so much prosperity, will fall with a very loud and undeniable crash.
There is no production without consumption just as there is no consumption without production.
Supply creates its own demand. Jean Baptiste Say.
They'll blame any negative news on Trump now; all positives (of which there will be many) will be attributed to what was left for him by Obama.
Did Baptiste say that Demand creates it’s own supply. Because he could just as well have.
Besides, how does that work? There is an awful large supply of salt water in the ocean. Where is the demand for that? With that much supply, there ought to be a tremendous demand if Baptiste has any kind of a clue.
Did Baptiste say that Demand creates it’s own supply. Because he could just as well have.
Besides, how does that work? There is an awful large supply of salt water in the ocean. Where is the demand for that? With that much supply, there ought to be a tremendous demand if Baptiste has any kind of a clue.
At the individual level, maybe it’s because they can actually afford to file bankruptcy now, finally, after eight long, miserable years getting a ray of hope that there’s some future beyond being slowly ground down into poverty, with the only way to survive being public assistance. This has been true of many former small business owners, at least. There’s some reason now to dust it all off and try to revive something that once generated a nice income.
Living large on credit and the Fed / ECB ... money printing will not end well for the middle class.
Great for the Dear Leaders and their Crony pals.
Since 1913.
It’s the basis for all supply side economics.
Read Gilder, “Wealth & Poverty”
The large supply of salt water creates demand for ocean front property.
Many national retail outfits and local shopping malls will likely continue to close stores, sell out , merge, or go broke.
JCPenney, Macy’s, K-Mart / Sears, H.H. Gregg, Gordmans , MC Sports, Gander Mountain, RadioShack, Payless shoes , Borders, Circuit City, Blockbuster ... just to start.
What I don’t get are all the mattress retail stores, they’re all over the place. Buying a mattress is a once every decade thing in my exposure, so what’s up with that, who or what is their market? I’ve been expecting bankruptcies among the many mattress retailers for years, but nothing yet.
LOL True, but that’s not the same. That’s demand for land, not water.
A large supply of snakes might create demand for snake repellent, poisons, hoes, maybe even mongooses (mongeese?) but it won’t create much demand for snakes. It’ll create some, the price of snake skin boots might fall generating a small increase in demand.
But generally, it can’t be said that supply always creates demand. The market seeks to balance supply and demand through market price.
In the case of salt water, that equibrium price is $0. And the water remains in the ocean unharvested.
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