Epiq Systems, Inc., a provider of managed technology for law firms, advises that total business bankruptcy filings in the United States have increased by 5% on a year-on-year basis, to a total of 65,511.
However, while consumer bankruptcy filings were up 5%, business Chapter 11 filings were up 30% on the same basis, from 298 Chapter 11 filings in November 2014 to 390 filings in November, 2015.
Nevertheless, the Wall Street Journal has just reported that the United States economy expanded at a modest pace in November 2015, with a rise in consumer spending and the beginnings of increased demand for labor. According to the Fed, there was modest or stronger growth in 10 out of its 12 districts.
The reports from Epiq and from the Fed come amid anticipation that the Federal Reserve’s Open Market Committee will begin the process of raising interest rates — at or near zero for the past many years — at the Committee’s December 15 meeting in Washington, DC. As Fed Chair Janet Yellen has noted, waiting too long to end the era of near-zero interest rates might result in the Fed tightening too quickly and causing market dislocations.
On the other hand, once the Fed begins tightening the screws on interest rates, it is entirely unclear what effect this will have on bankruptcy filings. Right now, there are plenty of credit facilities out there in the economy that can be handled relatively easily at current interest rates, but may become ever so much dicier at higher rates. Or, to mangle the metaphor, one can quote from the Sage of Omaha Warren Buffett:
“Only when the tide goes out do you discover who’s been swimming naked.”
Do you have any feedback, thoughts, reactions or comments concerning the increase of business bankruptcy filings? Feel free to leave a comment below for Joel R. Glucksman of if you have any questions about this post or would like assistance with your legal needs, please contact me or the Scarinci Hollenbeck attorney with whom you work.
You Just Received a Federal Grand Jury Subpoena in New Jersey: Now What?
Receiving a federal grand jury subpoena is not something most businesses or individuals anticipate. While it can be concerning, a federal grand jury subpoena does not necessarily mean that you are being accused of wrongdoing. It does, however, mean that a federal criminal investigation is underway and that federal prosecutors believe you may possess information […]
Why Every Business Should Conduct an Annual Insurance Coverage Review
Most New Jersey business owners purchase insurance policies, file them away, and assume they are protected if a claim arises. Without a regular insurance coverage review, many companies discover gaps only after a lawsuit, cyberattack, property loss, or other significant event occurs. An annual insurance coverage review can help businesses identify potential risks, ensure their […]
Demand Letters & Cease and Desist Letters: When to Send One (and When Not To)
Businesses and individuals often encounter situations where another party breaches a contract, fails to pay a debt, or continues harmful conduct. In many such disputes, a precisely drafted demand letter or cease-and-desist letter serves as a powerful legal tool. It can frequently resolve the dispute and avoid litigation. While demand or cease-and-desist letters can resolve […]
Key provisions in your contracts, including those relating to indemnification, insurance, and defense, are essential to contract risk management. While sometimes considered “boilerplate,” these provisions play a pivotal role when determining which party is responsible for certain costs and liabilities. They must always be negotiated and drafted carefully. Indemnification Clauses Businesses should never overlook the […]
Portability of estate and gift tax enables a surviving spouse to inherit any unused portion of their deceased spouse’s federal estate and gift tax exemption. So, if one spouse doesn’t utilize their full exemption, the surviving spouse can effectively double their exemption amount with regard to estate tax liability. For married couples, portability offers a […]
Pet Trusts in New Jersey and New York: A Practical Estate Planning Tool
For many of us, pets are more than companions—they are members of the family. Yet they are often overlooked or inadequately provided for when it comes to estate planning. A pet trust offers a legally enforceable way to ensure that your animal continues to receive proper care if you become incapacitated or pass away. As […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
