A Record Month for Throwing in the Towel
April showers bring May flowers, but in the corporate world, April brought something far less fragrant: a tidal wave of bankruptcies.
According to S&P Global,
official corporate bankruptcies skyrocketed by 88% in April compared to January.
Yes, you read that right—88%. It seems that the only thing blossoming this spring was the number of businesses waving the white flag.
So, what on earth is happening? Distressed businesses, much like that friend who’s always late, were expecting the Federal Reserve to cut interest rates early in 2024. But as it turns out, the Fed has been as reliable as a broken clock, leaving these businesses high and dry with sky-high interest rates. As a result, many companies are now opting for the corporate version of “stop the world, I want to get off.”
A Full Plate of Expenses: Inflation’s Lingering Legacy
Meanwhile, on the home front, Americans are still grappling with inflation’s annoying pinch. Although inflation peaked at a nosebleed-inducing 9.1% in June 2022 and has since cooled down to 3.5%, it’s still about as comfortable as a bed of nails.
A CNBC survey reveals that 54% of younger Americans feel the sting of rising food costs the hardest. When asked which expense inflation has hit the most, respondents had the following to say:
- Food: 54% (No surprise there—have you seen the price of avocados?)
- Rent: 22% (Because apparently, your landlord didn’t get the memo about your stagnant wages.)
- Discretionary Spending: 10% (Bye-bye, Netflix binge sessions.)
- Healthcare: 6% (Sick and tired of being sick and tired.)
- Utilities: 5% (Turns out, you can’t pay your electric bill with good vibes alone.)
Gold Fever: Korean Convenience Store Style
And now for something completely different:
In South Korea, you can add a new item to your convenience store shopping list—gold bars. Yes, you heard correctly. CU, the country’s largest convenience store chain, is now selling gold bars ranging from 0.1 to 1.87 grams. The heaviest bars go for around $165, while the popular one-gram bars are a steal at $83.
In a plot twist that could only happen in 2024, gold demand in South Korea jumped 27% year-over-year in Q1, with young people especially eager to get their hands on the precious metal. CU even reported selling out of its one-gram bars in just two days. Who needs chips and soda when you can invest in a shiny future during your snack run?
Refinancing Renaissance: Mortgage Rates Take a Dip
In the realm of real estate, there’s a tiny glimmer of good news. Mortgage rates, although still daunting, dipped slightly last week, sparking a 5% increase in weekly mortgage refinancing demand. Mortgage applications rose by 2% for the week but remain 17% lower than this time last year.
To put it bluntly, while 15-year mortgage rates hover at a devilish 6.66% and 30-year rates are at a hefty 7.20%, the recent drop has been enough to reignite some interest in refinancing. It’s like finding a few bucks in your couch cushions—not life-changing, but certainly a pleasant surprise.
