Bankruptcy Wave?

 There is a good financial piece this morning on ARD news (Channel One, public TV), on the wave of German bankruptcies coming shortly.

Here's the blunt short side of this story....the folks at Institute for Economics IW and the Federal Association of German Volksbanks and Raiffeisenbanks (BVR), sat down and crunched the numbers.  What they say....as you arrive at the beginning of 2021....various "zombie companies" will exist....deep into debt, and starting to file bankruptcy paperwork.

Somewhere between 6-percent and 28-percent (varying views) of German banks will be attached to the bankrupt companies.  Just to suggest 6-percent....is bad enough, but if you got up to 15 to 25 percent?  That invites serious discussions.

So this single end-of-the-year 'wave' being all you have to worry about?  NO.  For each quarter of 2021, there's anticipation going on that serious numbers will be mounted as each quarter comes into view.

Where this will lead to?  Well....the unemployment numbers might stay level for the first and second quarter of 2021....with the government stepping into each situation and pumping fresh government capital to keep the bankrupt company afloat while the government new 'owner' tries to sell the company.

But in this type of environment....one would seriously doubt buyers exist to buy these companies, and the employed folks within these....will just be given termination notices.  So as you near the fall (a federal election period)....this might be a serious issue that jerks around the national election.