Believe it or not, there are 12 restaurant chains currently in bankruptcy. The list includes restaurants such as Logan’s Roadhouse, Ryan’s, Johnny Carino’s, and Fox & Hound.
Restaurants come and go. That’s normal. But the number of large bankruptcies is not normal at all. Nation’s Restaurant News says, “The current wave of bankruptcies is definitely unusual…”
Why is this happening? It is due to a widespread consumer pullback and decreased spending on eating out. The restaurant chains suffering the most were already weak. Some are even in their third bankruptcy.
The restaurant industry is not a sideshow. About 14 million people work in it, according to the National Restaurant Association. With $710 billion in annual sales, it’s an important part of consumer spending and accounts for about 4% of GDP. If the industry is having problems, it’s a red flag for the overall economy.
This is not good. Restaurant spending is a fairly good barometer for the financial health of the American consumer.
Declining restaurant spending is a clear indicator that the U.S. economy is not doing as well as advertised.
From Wal-Mart to the Federal Reserve to the International Monetary Fund, there are new signs the U.S. economy is on the wrong track, a senior economic advisor to the Donald Trump campaign told CNBC on Thursday.
To make his point, David Malpass cited conservative news from Wal-Mart that broke just before his appearance on “Squawk Box.”
The giant retailer on Thursday morning reiterated its guidance for the current fiscal year, and said there would be fewer store openings than originally planned and a significantly slower store-opening pace in fiscal 2018. It also predicted flat earnings next year.
“The election presents a choice. Do you want the current policies, which Wal-Mart has given us a very clear forecast [of] … or do you want some different for the U.S.?” asked Malpass, president of economic and market research firm Encima Global.
Global equities are forecast to rise modestly in 2017, held back by concerns about the pace of U.S. Federal Reserve interest rate hikes and the waning effect of widespread monetary stimulus that has helped drive shares to lofty heights, Reuters polls show.
While massive stimulus from some of the world’s biggest central banks has underpinned a multi-year rally since the financial crisis, taking Wall Street to record highs, doubts over the potency of further monetary easing are growing. Read more →
Just how much of the financial world could new technology disrupt? Patrick Byrne is trying to push the limits. The hard-charging CEO of Overstock.com has become one of the leaders of the movement to use the “blockchain”—the open-source cryptographic code behind Bitcoin—to do far more than run an invented currency.
Last year, Byrne issued the world’s first-ever digital security—Overstock corporate debt—and began creating a new blockchain-based stock exchange to trade it on. Called Medici, the exchange promised a technological revolution that would turn securities trading on its head, replacing the financial clearinghouses that the whole system, and its regulators, depend on.
There’s both promise and threat in the blockchain. Its technology shares and checks information across many computers, so advocates say it’s a tool for transparency and security. But it also radically decentralizes money, leaving it unclear how blockchain-based markets can be policed under the current system. A year and a half after POLITICO first reported on Byrne’s plans and the policy implications of the blockchain, we caught up with Byrne on the progress of the blockchain revolution, the regulatory environment for the technology, and a new idea emanating from the Caribbean.
Q: Last April, you had offered a private security on the blockchain, but you still needed clearance to offer publicly traded stock in purely digital form. How’s that going?
A: We did get permission last December from the SEC to issue an Overstock security on this blockchain system we’ve developed. So we’ve been building up the technology but still working with the regulators.
U.S. consumer spending fell in August for the first time in seven months while inflation showed signs of accelerating, mixed signals that could keep the Federal Reserve cautious about raising interest rates.
The Commerce Department said on Friday that consumer spending, which accounts for more than two-thirds of U.S. economic activity, fell 0.1 percent last month after accounting for inflation.
Analysts polled by Reuters had expected a 0.1 percent gain.
“Consumers took a breather in August,” said Chris Christopher of IHS Global Insight.