America’s Big Bankruptcy Questions: Who, When And How Many?
Earlier this month, I wrote about the wave of bankruptcies washing over America in the wake of the COVID-19 lockdowns. What was an acute liquidity crunch is now manifesting in an insolvency crisis for some firms. A new study from Aaron Allen & Associates suggests some two-thirds of publicly-traded restaurants are teetering precariously on the brink, for instance. In the ten days since "Why You Have No Choice But To Buy Corporate Bonds Despite Black Swan Bankruptcy Spiral" was published, ne
5 thoughts on “America’s Big Bankruptcy Questions: Who, When And How Many?”
Nasdaq hitting news highs soon, what liquidity problem? What recession? Times are great, Buy, Buy, Buy Lol
I may be one of the few subscribers to remember the Kumamoto earthquake of 2016. As an event, and rather understandably, it barely registered in the global media and was forgotten within days, yet it was quietly disrupting Japanese national output for months afterwards. It was a powerful lesson on the sustained impact of supply shocks in our highly interconnected economies.
Fast forward to 2020 and we have had a supply shock impacting almost every single company on the planet. The current predictions for its likely impact are, I suspect, not just overly optimistic, but hopelessly so. I hope I’m wrong.
“…how much predictive power our past experience gives us in the face of the current crisis”
The dice we are rolling now have a few more sides. When the Fed dials in a firm floor for Main Steet, do we have an economic keel to this ship? Really?
This seems to focus on large scale bankruptcies. Or am I missing something. If so what about the main street bankruptcies? Since the pain of this pandemic should be felt hardest on those least able to withstand the difficulties. I have heard of one bar that is closing remainder of year. The owner took a job as did bartender. The result is they are shut down paying rent out of paychecks until the bar can be opened again. Is this not an effective bankruptcy even if not filed?
I’m going to guess that total bankruptcies were down in April because of an inability to file the paperwork at closed courthouses.