From January to July this year, the number of bankrupt companies in the United States increased by 2 times year-on-year, which should be the largest wave of corporate bankruptcies in the United States since 2008.
For example, Simmons, as we know it, ushered in its eighth bankruptcy this year, and it has a history of 153 years, and previously had more than 300 specialty stores in the mainland; In March and April, Signature Bank, First Republic Bank and Silicon Valley Bank were either thunderstorms or bankrupt; At the end of July, the US logistics giant Yellow declared bankruptcy, considering that the trucking company has been in existence for 99 years, with a fleet of 12,000 trucks and transportation services for more than 800,000 customers around the world.
The above are all the top large enterprises in the United States, and there are countless bankrupt small enterprises, and the reason for all this is that the Fed has raised interest rates more than a dozen times in a row. In the first two years, affected by the epidemic, the United States printed a large number of money to lent to enterprises, at that time corporate loans were almost 0 interest rates, but now when repayment, interest rises again and again, many enterprises simply lie flat directly, loans are not repaid.
But if you don't raise interest rates, inflation in the United States has been soaring after printing a lot of money, and although it has slowed down for a while through interest rate hikes, inflation has begun to rebound in August and September, and inflation has a great impact on the United States. First of all, the dollar is the global currency, if a commodity one price a day, the next day and another price, then the global prices and transactions will be chaotic, so that more and more countries will abandon the dollar settlement, and turn to find a more stable currency.
In addition, high inflation will also affect the yield of U.S. bonds, if the interest rate of U.S. bonds is only 5%, and inflation is as high as 9%, then buying U.S. bonds is losing money, so who dares to take over U.S. bonds? The US debt is the lifeblood of the United States, and now the US government spending and military are maintained by constantly raising the US debt ceiling.
Coincidentally, the strike of 150,000 auto workers by GM, Ford and Chrysler in September will affect the supply of cars, leading to higher car prices, and even the price of used cars will rise, and finally further increase inflation in the United States.
So, the United States is now caught in a dilemma: if interest rates continue to rise, then more and more companies will go bankrupt; But if interest rates are not raised, inflation cannot be contained, and then the US debt and the dollar will be fatally affected.
Finally, do you think the United States can resolve this knot? What will happen to the United States in the end?
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