Chapter 11 is very popular
More and more large US companies are having difficulty paying due to the cycle of rising interest rates.
Graphic source: Apollo Academy
You can read over and over that the Fed’s interest rate hikes have had little impact on the real economy. Consumers and businesses know how to deal with higher interest rates, and the damage to the overall economy from restrictive monetary policy is much less than expected.
A look at US companies’ filings for Chapter 11 proceedings tells a different story. A significantly higher number of applications were submitted in November than in previous months. Therefore, the epidemic level has been exceeded.
During a Chapter 11 proceeding, a company can continue to operate, reorganize, and reorganize its business under the court’s temporary protection from creditors. This means that the insolvent company retains control of the business unless the bankruptcy court orders otherwise.
This procedure is frequently used by large American companies. However, the increase in orders suggests that the cycle of rising interest rates is not without consequences even for larger companies.
Found an error? Report now.
“Alcohol buff. Troublemaker. Introvert. Student. Social media lover. Web ninja. Bacon fan. Reader.”
More Stories
Bosch buys heat pump business from US company: Here’s why
The Body Shop files for bankruptcy in the UK
Kaspersky: All employees in the US must leave – business activities will be terminated