US bankruptcies up 18% as household debt stands at record high $17.3 Trillion and a home mortgage is double; Have we hit the breaking point?

Manhattan-Skyline

Important Takeaways:

  • U.S. bankruptcies surged 18% in 2023 and seen rising again in 2024 –report
  • U.S. bankruptcy filings surged by 18% in 2023 on the back of higher interest rates, tougher lending standards and the continued runoff of pandemic-era backstops, data published Wednesday showed, although insolvency case volumes remain well below the level seen before the outbreak of COVID-19.
  • Total bankruptcy filings – encompassing commercial and personal insolvencies – rose to 445,186 last year from 378,390 in 2022, according to data from bankruptcy data provider Epiq AACER.
  • Commercial Chapter 11 business reorganization filings shot up by 72% to 6,569 from 3,819 the year before, the report said. Consumer filings rose 18% to 419,55 from 356,911 in 2022.
  • For the final month of the year, total filings dipped to 34,447 from 37,860 in November, though they were up 16% from a year earlier.
  • Bankruptcy case counts are expected to keep climbing in 2024, though there is still some distance to go to top the 757,816 bankruptcies filed in 2019, the year before the pandemic struck.
  • Household debt did, in fact, stand at a record high $17.3 trillion at the end of the third quarter, according to data from the New York Federal Reserve

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Rise in Bankruptcy, Credit Card debt, and weakening stock market: Is the US headed for recession?

US-Bankruptcy-chart

Important Takeaways:

  • The rise of the MEGA bankruptcy: 459 US firms have filed for bankruptcy this year – the most since 2020 – and 16 had more than $1 billion in assets
  • Large-scale corporate bankruptcies are at their highest level since 2020 as elevated interest rates continue to batter businesses.
  • Economists warn large-scale bankruptcies can have devastating consequences
  • Some 459 firms filed for bankruptcy so far this year – already more than in 2021
  • Bed Bath and Beyond, trucking firm Yellow and Silicon Valley Bank among the biggest casualties
  • David’s Bridal have filed for Chapter 11 bankruptcy thanks to a perfect storm of rampant inflation, high rates and supply-chain disruptions.
  • Economists warn the rise in large-scale collapses can have devastating consequences on the economy.
  • For example, the demise of trucking firm Yellow – which reportedly had $2.15 billion in assets at its time of filing – reverberated through domestic shipping and real estate markets to Wall Street.
  • The rise in bankruptcies coupled with a weakening stock market and surge in credit card delinquencies has sparked fears the US is heading for a recession.

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Yellow Corp. freight company winds down its business seeking bankruptcy protection, leaving 30,000 without work

Yellow-Truck-Freight

Important Takeaways:

  • Bankruptcy becomes official for Yellow freight company; trucking firm going out of business
  • U.S. trucking giant Yellow Corp. has announced that it has declared bankruptcy following a tense standoff with the Teamsters Union and after a massive pandemic-era federal loan failed to stave off the company’s mounting debt.
  • The freight company based in Nashville, Tennessee, which employs about 30,000 workers, said in a news release on Sunday that it was seeking bankruptcy protection so it can wind down its business in an “orderly” way. The Chapter 11 petition was filed in federal bankruptcy court in Delaware.
  • While a Chapter 11 filing is used to restructure debt while operations continue, Yellow will liquidate and the U.S. will join other creditors unlikely to recover funds extended to the company, according to the Associated Press.
  • A dominant player in the supply chain industry, Yellow became the third-largest small-freight-trucking company in the U.S. with clients that included both big box retailers and small family businesses.
  • But the company had an outstanding debt of about $1.5 billion as of March and has continued to lose customers as its demise appeared imminent.

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David’s Bridal files for bankruptcy, plans layoffs

Revelations 13:16-18 “Also it causes all, both small and great, both rich and poor, both free and slave, to be marked on the right hand or the forehead, so that no one can buy or sell unless he has the mark, that is, the name of the beast or the number of its name. This calls for wisdom: let the one who has understanding calculate the number of the beast, for it is the number of a man, and his number is 666.”

Important Takeaways:

  • David’s Bridal filed for bankruptcy protection days after the company announced it would lay off more than 9,200 employees across the nation.
  • The wedding retailer said in a press release Monday that its stores would remain open and fulfill orders without delay as the company looks to sell all or some of its assets. Its online platforms will also remain available to help with customers’ wedding planning needs.
  • David’s Bridal started as a small bridal salon in Florida in 1950. The chain now has about 300 locations across the country.

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Michael Snyder reports on 5 disasters that we were warned about that are happing now

Revelations 13:16-18 “Also it causes all, both small and great, both rich and poor, both free and slave, to be marked on the right hand or the forehead, so that no one can buy or sell unless he has the mark, that is, the name of the beast or the number of its name. This calls for wisdom: let the one who has understanding calculate the number of the beast, for it is the number of a man, and his number is 666.”

Important Takeaways:

  • #1 We were warned that a great commercial real estate crisis would be coming, and now it is here.
    • With recent stress in the regional banking sector, sentiment in US commercial real estate (CRE) – and especially the office sector – has turned negative as investors prepare for potential spillover effects (with JPM, Morgan Stanley, and Goldman Sachs all joining the gloom parade), especially as high-profile defaults continue to make headlines as borrowers face higher debt service costs and refinancing becomes much harder ahead of a $400 billion CRE debt maturities this year alone…
  • #2 We were warned that there would be widespread layoffs as economic conditions in the United States deteriorated. Sadly, that is now happening all around us.  For example, on Monday accounting firm Ernst & Young announced that they will be laying off thousands of highly paid workers…
  • #3 We were warned that the largest corporate debt bubble in the history of the world would eventually burst, and now corporations are beginning to default on their debts at a rate that should deeply alarm all of us
  • #4 We were warned that we would witness a dramatic surge in bankruptcies in 2023, and that is precisely what is happening
    • Bankruptcy filings across the United States rose for the third straight month in March in all major industries. A total of 42,368 new bankruptcies were filed last month, according to data from Epiq Bankruptcy, a provider of U.S. bankruptcy court data, technology, and services.
  • #5 We were warned that the rest of the world would eventually start rejecting the U.S. dollar, and now “de-dollarization” is happening at a “stunning” pace

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Investors looking for stable assets as Gold hits record high in Japan

Ezekiel 7:19 “They shall cast their silver in the streets, and their gold shall become abhorrent; their silver and their gold shall not be able to deliver them in the day of the wrath of the Lord; they shall not satisfy their souls, or fill their stomachs, for their iniquity has become a stumbling block.”

Important Takeaways:

  • Retail price of gold in Japan hits all-time high of $67 per gram
  • The retail price of gold in Japan has hit an all-time high of 9,000 yen ($66.94), according to data released by one of the country’s largest producers and sellers of precious metals, Tanaka Kikinzoku, on Monday.
  • The record price was fixed amid investors’ growing interest in stable assets following the bankruptcy of one of America’s largest banks, Silicon Valley Bank.
  • On March 10, the California Department of Financial Protection announced the bankruptcy of SVB, the 16th-biggest lender in the United States. It served mainly employees in the technological sector and companies financed with venture capital. It became the largest bankruptcy of a US bank since the 2008 financial crisis as estimated by the CNN TV channel.

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Stress of high inflation with no pandemic aid show Bankruptcies on the rise

Bankruptcy

Revelations 18:23:’For the merchants were the great men of the earth; for by thy sorceries were all nations deceived

Important Takeaways:

  • Now that pandemic aid has vanished, bankruptcies are on the rise
  • Total bankruptcy filings in January shot up 19% in January to 31,087, up 19% from a year ago, according to data from Epiq, a legal research firm. The number of Americans who filed for bankruptcy across Chapters 7, 11 and 13 shot up 20% in January from a year ago.
  • The surge in filings comes as rising interest rates and high inflation continue to stress household budgets.

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Bed Bath & Beyond reporting major losses, possibility of bankruptcy filing coming soon

Revelations 18:23:’For the merchants were the great men of the earth; for by thy sorceries were all nations deceived.’

Important Takeaways:

  • Bed Bath & Beyond looks for capital infusion, buyer ahead of likely bankruptcy filing
  • The retailer is in the midst a sale process in hopes of finding a buyer that would keep the doors open for both of its major chains, its namesake banner and Buybuy Baby, said the people, who weren’t authorized to discuss the matter publicly.
  • A Bed Bath spokeswoman said Wednesday the company doesn’t comment on specific relationships but has been working with strategic advisers to evaluate all paths to regain market share and enhance liquidity.
  • Earlier this month Bed Bath warned it may need to file for bankruptcy after its turnaround plans failed to substantially boost sales and repair its balance sheet.
  • The company reported net losses that exceed $1.12 billion for the first nine months of the fiscal year.

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Party City filing for Bankruptcy

Party City Store

Revelations 18:23:’For the merchants were the great men of the earth; for by thy sorceries were all nations deceived.’

Important Takeaways:

  • America’s largest party supply store files for bankruptcy
  • The largest party goods and Halloween specialty retail chain in the United States said in a regulatory filing that it reached an agreement with debtholders to cut its $1.7 billion debt load
  • Party City has for years battled competition for party goods and decorations, especially from big-box chains and online retailers that sell a wider variety of merchandise.
  • Target in particular has increased its party supplies and special events merchandise, said Neil Saunders, an analyst at GlobalData Retail.
  • Between 2017 and 2021, Party City’s sales dropped 8% to $2.2 billion. The company projected sales to remain flat in 2022. The company also lost money every year between 2019 and 2021 and said was on track to lose up to $199 million in 2022.

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Genesis Global Capital prepares for Bankruptcy

Revelations 18:23:’For the merchants were the great men of the earth; for by thy sorceries were all nations deceived.’

Important Takeaways:

  • Crypto Firm Genesis Is Preparing to File for Bankruptcy
  • Genesis Global Capital is laying the groundwork for a bankruptcy filing as soon as this week, according to people with knowledge of the situation.
  • The cryptocurrency lending unit of Digital Currency Group has been in confidential negotiations with various creditor groups amid a liquidity crunch. It has warned that it may need to file for bankruptcy if it fails to raise cash, Bloomberg previously reported.

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