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As a child growing up in sweltering Central Florida, one of my fondest memories was a trip to Twistee Treat for ice cream. My brother and I would pile in the back of the car, sans seatbelts and I’d clap my hands in anticipation. After 33 seconds, I’d ask my mom, “Are we there yet?” Those were simpler times. I was 15 years old.
A few years later, I’m also fondly anticipating the buying opportunity of a lifetime for my clients. I say that because I sense we are staring down the barrel of a liquidity crisis. The Federal Reserve has made everything but cash complete trash.
Bankruptcies are up 216% on the year. Higher than the peak of the 2008 crisis. Double the covid lockdowns.
236 companies have gone under. More than double this time last year. $10 million plus bankruptcies are running 8 per week. That’s almost double the peak of the lockdown.
And we aren’t even there yet. The economy is strong as HE double hockey sticks. Just ask world-famous economic and ice cream expert, Joe Biden.
What’s fascinating is that we are hitting these type of bankruptcy numbers now. Typically peak bankruptcies are months into a recession or financial crisis. I see several explanations.
- We are already in a recession and have been for some time.
- Banks aren’t lending or refinancing to help keep even healthy businesses afloat. Instead they are strengthening their balance sheets in preparation for said bankruptcies. Like a dysfunctional Gift of the Magi. They know there’s a liquidity crisis afoot.
- This is the beginning of a very deep recession, and these numbers will only get worse.
- All of the above.
- Everything is fine, Joe Biden is telling the truth and Rey is just a party pooper.
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