Many struggling companies tapped robust debt markets this year to stave off final reckonings. But a flurry of recent bankruptcy filings suggests the corporate carnage set off by the financial crisis isn't done yet.
The U.S. default rate, which peaked at nearly 15% in November 2009, according to Moody's Investors Service, has since fallen below 4%. Credit markets are coming back, helping finance firms that seemed on the brink just 12 months ago. But many of these companies remain saddled with too much debt.
Clockwise from top left: MGM/Everett Collection, Associated Press, Bloomberg News (2)
James Bond, top left, couldn't prevent Metro-Goldwyn-Mayer from joining, clockwise, Charlie Brown's Steakhouse owner CB Holding, National Enquirer publisher American Media and discount-apparel retailer Loehmann's Holdings from seeking bankruptcy protection in November.
Despite welcoming credit markets, smaller companies remain constrained, unable to tap new financing as easily as large corporations. These firms in some cases are more reliant on banks or other financial institutions to stay alive, a dependency that can prove difficult amid current market conditions.
One looming question: Will interest rates remain low enough so that credit markets remain open, allowing companies to continue to refinance and avoid restructuring?
November brought a number of new Chapter 11 filings, including studio Metro-Goldwyn-Mayer Inc., Yellow Pages publisher Local Insight Media Holdings Inc. and steakhouse owner CB Holding Corp.
Discount-apparel retailer Loehmann's Holdings Inc. and National Enquirer publisher American Media Inc. filed for bankruptcy protection. Vertis Holdings Inc., a direct-mail advertising and printing company, also sought Chapter 11 protection for the second time in two years.
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ws = wallstreet. wallstreet, ws, would be better seen as called Willscam. And now look, they post stuff on here for us to read. Thanks. The truth is we have all been given a lie and the more it goes the more we are growing in lies. wallstreet created gold crisis that all are panicing on. now china wont do us trade. now we have not enough money to go around country. The truth is that wallstreet caused big mess with house selling, coins, dow jones arrow, gulf oil, iraq, educations, loans, debt, printing. They caused it. Bankrupting the world since 1900 is a good logon for willscam. Another fact is indeed business goes bankrupt, money is short on cash, food is hard to get, coins are few, chinese get strong, we are getting fat. who needs movies when we need workout. Throw rocks at devils in banks and wallstreet. thank lord for family.
ReplyDelete- Sam
4:05 YOU LEFT OUT OUR "BELOVED GOVERNMENT" THEY HAD A HUGE HAND IN THIS CLUSTER!
ReplyDeleteCom'on Obama. Raise the tax rate maybe we can get all of them to go bankrupt.
ReplyDeleteit's why the pundits said corporations where sitting on much cash, as in had alot of mollah to spend and the recovery is in swing, purposely leaving out that corps liabilities, which would show them in debt still...spin
ReplyDeletelol..notice today the gov numbers released prior revised lower today, they do it allll the time