If the economy really is in “good shape”, then why are so many prominent businesses rushing to permanently shut down locations that were once profitable? As you will see below, banks are closing thousands of branches and retailers are closing thousands of stores. If a new golden age of prosperity is dead ahead, that wouldn’t make any sense at all. Of course the truth is that most people are really struggling in our current economic environment, and conditions are going to get even worse in 2024.
Bank executives can see what is happening, and so they are feverishly trimming costs
Sadly, branches continue to get shut down at a staggering rate.
For example, it is being reported that Bank of America has decided to permanently shut down “nearly two dozen Bay Area branches or ATMs”…
Banks are legally required to report closures to the Office of the Comptroller of the Currency at least 90 days before their scheduled shuttering, so customers will know if they’ll be impacted.
Another way that banks are cutting costs is by laying off workers.
According to Zero Hedge, twenty of the largest banks have combined to eliminate 61,905 jobs so far this year…
A new report from the Financial Times shows twenty of the world’s largest banks slashed 61,905 jobs in 2023, a move to protect profit margins in a period of high interest rates amid a slump in dealmaking and equity and debt sales. This compared with the 140,000 lost during the GFC of 2007-08.
“There is no stability, no investment, no growth in most banks — and there are likely to be more job cuts,” said Lee Thacker, owner of financial services headhunting firm Silvermine Partners.
FT noted that corporate disclosure data and its independent reporting did not include smaller regional bank cuts, indicating total job loss could be much higher.
The banks are not okay.
In fact, I expect the big banks to make lots of headlines in 2024.
Meanwhile, problems continue to pile up for the retail industry.
CNN says that Nike is “a bellwether for the global economy”, and so the fact that the company is planning to cut costs by about 2 billion dollars is not a good sign at all…
Nike, a bellwether for the global economy, sounded a warning sign Thursday as the sneaker giant sees consumers becoming more cautious.
Nike slashed its revenue outlook for the year and announced cost cuts amid growing concerns that consumers are slowing their spending around the world. The company said it’s looking for as much as $2 billion in cost savings in the next three years, which includes laying off employees.
But at least Nike is still in business.
2023 was a year when retailers closed thousands of stores, and a number of well known chains actually had to file for bankruptcy…
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