The End Of Small Business In America, 50% Could Fail Within 2 Months, Debt In Recessions A Bad Mix

• Silver Report Uncut
  50% of small businesses could fail within 2 months according to a recent survey done by Deutsche Bank meaning under the current economic conditions millions of jobs are at risk. The truth is the economy was heading into a recession before any of this began which is interesting considering so much discussion recently about how great everything has been. Most don’t remember the yield curve inverted months before any of these existential problems entered the 3 month and 10 year along with the 2’s and 10’s, in fact, there was a point when the entire yield curve was inverted and the fed began cutting interest rates all the while explaining how the economy was strong. Some other actions the fed was taking was to print trillions and pump it into the repo market which is something they hadn’t done since the great recession so no we were not in the greatest economy ever. The reason so many businesses are at risk of failure happens to be the policy response and typically interest rates are lowered to help indebted businesses refinance to kick the can down the road and help the transition out of a recession. The issue this time is policy response was to add a ton of debt to already fragile companies that are in a cycle of downsizing which means companies that couldn’t manage their debt during good times are now facing mountains more with diminished output and lower profits. The implication is this will inevitably lead to even more business failures than the great recession. Debt is the problem, not the solution.

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