Tag: Credit and Debt

Virus Revives Italy’s Age-Old Shadow Safety Net: The Pawnshop

ROME — The economic repercussions of Italy’s lockdown to contain the coronavirus nearly wiped Anita Paris out. Her son, a car mechanic whom she depended on for financial support, couldn’t work. Her small pension didn’t suffice. The welfare checks she had hoped would pour in from the government didn’t materialize. And so Ms. Paris, a […]

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Banks Should Face History and Pay Reparations

Corporate chief executives have been tripping over themselves to demonstrate their support for racial justice. They’ve taken a knee, tweeted that black lives matter, donated money to advocacy groups and affirmed their commitment to inclusion. That’s all well and good. And following through on their promises — by hiring and promoting more people of color, […]

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The Tiny Bank That Got Pandemic Aid to 100,000 Small Businesses

From its address on the west side of the Hudson River to its tiny balance sheet, Cross River Bank is nothing like Manhattan’s Wall Street behemoths. But as part of the government’s efforts to stave off an economic catastrophe, it stands among giants. Cross River has churned out loans to more than 106,000 businesses through […]

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Judge Expected to Approve PG&E Plan to Resolve Bankruptcy

A federal judge on Friday is expected to approve Pacific Gas & Electric’s plan to exit bankruptcy, a crucial step in efforts to overhaul a utility whose equipment was involved in some of the worst wildfires to ravage California in recent years. If the judge confirms PG&E’s bankruptcy plan before the end of June, the […]

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Coronavirus Bankruptcies Are Coming

Already, companies large and small are succumbing to the effects of the coronavirus. They include household names like Hertz and J. Crew and comparatively anonymous energy companies like Diamond Offshore Drilling and Whiting Petroleum. And the wave of bankruptcies is going to get bigger. Edward I. Altman, the creator of the Z score, a widely […]

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Second Stimulus Check, Unemployment, Stocks and More During Coronavirus Pandemic

ImageCredit…Robert Neubecker We’re here to help. The pandemic has put millions of people out of work, forced painful sacrifices and put many in the position of needing help they never imagined would be necessary. We assembled this guide to connect you with information about government benefits, free services and financial strategies to get you through […]

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Shares of Chesapeake Energy, a Shale Pioneer, Tumble in Volatile Trading

HOUSTON — Shares of Chesapeake Energy, a pioneer in extracting natural gas from shale rock that came to be known for an illegal scheme to suppress the price of oil and gas leases, went on a wild ride on Tuesday amid reports that it was preparing a bankruptcy filing. Trading was halted for more than […]

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Central Bankers Have Crossed Bright Lines to Aid Economies

As global central banks race to rescue their economies from coronavirus devastation, they are crossing red lines and trying out policies they had never before attempted. They’re probably not done yet. Faced with a crisis unlike any other in memory, central bankers have embarked on new efforts to keep credit flowing and to set the […]

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Central Bankers Have Crossed Bright Lines to Aid Economies

As global central banks race to rescue their economies from coronavirus devastation, they are crossing red lines and trying out policies they had never before attempted. They’re probably not done yet. Faced with a crisis unlike any other in memory, central bankers have embarked on new efforts to keep credit flowing and to set the […]

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Tenants’ Troubles Put Stress on Commercial Real Estate

In the middle of March, as Covid-19 was shutting down the U.S. economy, Hughes Marino, a West Coast commercial real estate brokerage firm based in San Diego, wrote an email to clients offering to haggle with their landlords for lower rent. The firm was ready to help companies “restructure their leases as rents collapse,” it […]

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Poor Countries Face a Debt Crisis ‘Unlike Anything We Have Seen’

From Angola to Jamaica to Ecuador to Zambia, the world’s poor countries have had their finances shredded by the global pandemic. The president of Tanzania has called on “our rich brothers” to cancel his country’s debt. Belarus veered toward a default when a promised $600 million loan from Russia fell through. Russia couldn’t spare the […]

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Virus Forces N.Y.C. to Consider Tactic That Nearly Led to Ruin in ’75

The coronavirus pandemic has plunged New York City into the most dire fiscal crisis it has faced in generations. More than 900,000 people have lost their jobs since February, and thousands of businesses have closed. The streets remain empty of workers and visitors: Nearly 117,000 people filed new unemployment claims in the second week of […]

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Virus Forces N.Y.C. to Consider Tactic That Nearly Led to Ruin in ’75

The coronavirus pandemic has plunged New York City into the most dire fiscal crisis it has faced in generations. More than 900,000 people have lost their jobs since February, and thousands of businesses have closed. The streets remain empty of workers and visitors: Nearly 117,000 people filed new unemployment claims in the second week of […]

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The Fed Should Not Subsidize Fossil Fuels

The coronavirus pandemic has laid bare just how vulnerable the United States is to sudden, catastrophic shocks. Climate change poses the next big threat. Ignoring it, particularly to the benefit of fossil fuel interests, is a risk we can’t afford. From my time as a Federal Reserve governor and then deputy Treasury secretary, I’ve learned […]

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A €750 Billion Coronavirus Recovery Plan Thrusts Europe Into a New Frontier

BRUSSELS — For decades, even when the 2008 financial crisis threatened to blow the bloc apart, the European Union’s wealthier nations resisted the notion of collective debt. But the coronavirus has so fundamentally damaged the bloc’s economy that it is now forcing European leaders to consider the sort of unified and sweeping response once thought […]

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A €750 Billion Virus Recovery Plan Thrusts Europe Into a New Frontier

BRUSSELS — For decades, even when the 2008 financial crisis threatened to blow the bloc apart, the European Union’s wealthier nations resisted the notion of collective debt. But the coronavirus has so fundamentally damaged the bloc’s economy that it is now forcing European leaders to consider the sort of unified and sweeping response once thought […]

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Dismal Earnings, Bullish Stock Investors and the Fed’s Invisible Hand

Wall Street analysts have grown increasingly pessimistic in recent weeks about the outlook for corporate profits, even as investors have pushed markets steadily higher, breaking the link between analyst forecasts and the direction of stock prices. Most companies in the S&P 500 stock index have reported their first-quarter earnings, and the impact of the coronavirus […]

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Hertz, Car Rental Pioneer, Files for Bankruptcy Protection

Hertz, which started with a fleet of a dozen Ford Model T’s a century ago and became one of the world’s largest car rental companies, filed for bankruptcy protection on Friday after falling victim to its mountain of debt. The coronavirus pandemic has devastated Hertz by grounding business travelers and tourists, making it impossible for […]

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A Wave of Small Business Closures Is on the Way. Can Washington Stop It?

One of the great threats to the post-pandemic economy is becoming clear: Vast numbers of small and midsize businesses will close permanently during the crisis, causing millions of jobs to be lost. The federal government moved with uncharacteristic speed to help those businesses — enacting the Paycheck Protection Program, with $669 billion allocated so far. […]

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Too Big to Fail: The Entire Private Sector

During the 2008 financial crisis, Wall Street banks and other big financial institutions were deemed “too big to fail.” The crisis unleashed by the pandemic has broadened that elite status to a significant swath of the American private sector. In a bid to soften the coronavirus’s economic blow, the government has stretched its financial safety […]

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Lives Depend on Argentina’s Debt Talks

Argentina is currently engaged in intense negotiations with its creditors over at least $65 billion in government debt. The most important part of that negotiation, which can make or break Argentina’s economic recovery, is foreign currency debt. That is mostly in dollars, and mostly owned by foreigners. Argentina’s 45 million residents, as well as hundreds […]

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Fear of Risk Could Diminish the Economic Rescue by the Treasury and Fed

As the United States plunges into the worst economic downturn in decades, there is growing concern that the Federal Reserve and the Treasury are being too timid and halting in their approach as they scramble to rescue the economy. On Monday, a report from the congressional commission overseeing the Fed and Treasury’s efforts pointed out […]

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The Coronavirus Threatens China’s Belt and Road Loans

As the coronavirus spread around the globe, Pakistan’s foreign minister called his counterpart in Beijing last month with an urgent request: The country’s economy was nose-diving, and the government needed to restructure billions of dollars of Chinese loans. Similar requests have come flooding in to Beijing from Kyrgyzstan, Sri Lanka and a number of African […]

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Government Spending? In This Economy?

As the American economy plunges toward a recession, economists and policymakers are triaging proposals to stanch the bleeding. All of their ideas will cost money the government doesn’t have. That leaves Democrats and Republicans with two major questions: How much should be borrowed for bailouts — and what spending is needed to avoid permanent economic […]

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Fed Chair Says Economic Recovery May ‘Stretch’ Through End of 2021

Jerome H. Powell, the Federal Reserve chair, said that the United States would have a slow recovery from what he called the “biggest shock that the economy’s had in living memory,” suggesting that a full rebound from virus-induced lockdowns could take until the end of 2021. In an interview on “60 Minutes,” the CBS program, […]

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How Washington Learned to Embrace the Budget Deficit

WASHINGTON — This month, the federal government said it would borrow a record-breaking $3 trillion from April to June to help businesses and workers get through the coronavirus-induced recession. In April alone, the United States recorded a larger budget deficit in a single month than it did for all of the 2017 fiscal year, a […]

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How Wall Street Is Hampering Some Small Businesses Seeking Aid

When Michael Sullivan borrowed $22 million from a specialist Wall Street lender in 2018 to buy and renovate two Florida hotels, he had no idea how costly that decision would prove to be. He found out recently, once visitors stopped coming to his properties because of the pandemic, prompting him to seek help from the […]

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The Pandemic Helped Topple Two Retailers. So Did Private Equity.

J. Crew and Neiman Marcus were each facing a host of issues before the coronavirus pandemic forced them to close their stores and eventually file for bankruptcy, including trouble adjusting to the rise of e-commerce and a lack of connection with a new generation of shoppers. But they also shared one increasingly common problem for […]

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Fed Chair Warns the Economy May Need More as Congress Hesitates

The Federal Reserve chair, Jerome H. Powell, delivered a stark warning on Wednesday that the United States was experiencing an economic hit “without modern precedent,” one that could permanently damage the economy if Congress and the White House did not provide sufficient financial support to prevent a wave of bankruptcies and prolonged joblessness. Mr. Powell’s […]

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