NY Fed Finds Rising Consumer Debt Amid Some Fraying for Car Loans​​​

Overall debt levels held by Americans rose modestly in the final quarter of last year on a healthy consumer sector, even as borrowing for automobiles faced some signs of stress, the Federal Reserve Bank of New York said today, according to Reuters. “Consumers are in pretty good shape in terms of the household debt landscape, largely driven by stable balances and solid performance in mortgage loans,” the bank said in a posting detailing the findings on its latest report on the state of household debt, this time for the fourth quarter of 2024. “However, for auto loans, higher car prices combined with higher interest rates have driven monthly payments upward and have put pressure on consumers across the income and credit score spectrum,” New York Fed economists wrote. New York Fed researchers said that borrowing levels relative to income are pretty stable and still below levels seen before the COVID-19 pandemic, even as some sectors like car lending face some trouble. The bank’s borrowing data details conditions for an economy with solid growth and low unemployment, even as inflation pressures remain elevated and short-term interest rates are high. The Fed’s current monetary policy stance has increased borrowing costs broadly, most notably chilling activity in the housing market. Read more.

U.S. Weekly Jobless Claims Fall Amid Stable Labor Market​​​

The number of Americans filing new applications for unemployment benefits decreased last week, suggesting that the labor market remained stable early in February, Reuters reported. Initial claims for state unemployment benefits fell 7,000 to a seasonally adjusted 213,000 for the week ended February 8, the Labor Department said today. Claims have trended lower so far this year, consistent with historically low layoffs. That is helping to underpin the economic expansion, allowing the Federal Reserve to pause interest rate cuts while it assesses the impact of policies by President Donald Trump's administration. Despite low layoffs, employment opportunities for those who lose their jobs are no longer as abundant as they were a year or so ago, with businesses adopting a wait and see attitude. Nonfarm payrolls increased by 143,000 jobs in January, while the unemployment rate was at 4.0%. The number of people receiving benefits after an initial week of aid, a proxy for hiring, declined 36,000 to a seasonally adjusted 1.850 million during the week ending February 1, the claims report showed. Read more.

Subchapter V Experiences to Share? ABI Wants to Hear from You!

ABI is continuing its study of Subchapter V, and it needs your help! We are particularly interested in learning more about the real-world impact of Subchapter V. So our question is, do you have a story about a distressed business or creditor who has used or benefited from the subchapter? If so, could that case still happen under the lower debt cap for Subchapter V debtors? Any and all responses are welcome. Submit your story at https://abi.org/subvstories.
 

‘Deregulation by Firings’: Breaking Down the Cuts to Financial Oversight​​​

The Trump administration is rapidly delivering wins to American companies by rolling back regulations, pausing investigations and retreating from lawsuits accusing employers of discrimination, the New York Times reported. A combination of firings, stop-work orders and litigation pauses has hobbled regulators like the Consumer Financial Protection Bureau, the Equal Employment Opportunity Commission, the National Labor Relations Board, and the Securities and Exchange Commission. The moves have led the S.E.C. to pull back on its attempt to police the cryptocurrency boom and upended efforts at other agencies to protect worker rights. The speed and scale of the deregulatory moves by President Trump reflect his ambitious agenda to downsize government. “Under the Trump administration, federal consumer protections are being rapidly stripped away in a lawless process,” said Adam Levitin, a professor at Georgetown Law who specializes in financial regulation. “This is deregulation by firings.” Read more.

In related news, Trump administration officials are discussing plans to curtail and combine the power of banking regulators — without Congress’s input, the Wall Street Journal reported. In recent discussions, Trump advisers and allies have examined whether it is possible to collapse the Federal Deposit Insurance Corp. into the Treasury Department, according to people familiar with the matter. They have also discussed combining the FDIC’s regulatory role with the Office of the Comptroller of the Currency under Treasury. (Subscription required.)” Read more.

U.S. Producer Prices Rise Slightly Above Expectations in January​​​

U.S. producer prices increased solidly in January, offering more evidence that inflation is picking up again and strengthening financial market views that the Federal Reserve will not be cutting interest rates before the second half of the year, Reuters reported. The producer price index for final demand rose 0.4% last month after an upwardly revised 0.5% gain in December, the Labor Department's Bureau of Labor Statistics (BLS) said on Thursday. Economists polled by Reuters had forecast the PPI rising 0.3%. In the 12 months through January, the PPI advanced 3.5% after increasing 3.3% in December. The report followed news on Wednesday that consumer prices accelerated by the most in nearly 1-1/2 years in January, dimming hopes that the U.S. central bank would resume cutting rates in June. Financial markets now expect a rate reduction in September, though some economists believe the window for further policy easing has closed, citing strong domestic demand and a stable labor market. Read more.

Public Comment Period on Proposed Bankruptcy Amendments Closes on Monday​​​

The comment period is set to close on Feb. 17 for the Judicial Conference Committee on Rules of Practice and Procedure's proposed amendments to Bankruptcy Rules 1007, 3018, 5009, 9006, 9014 and 9017, new Rule 7043 and Official Form 410S1. For more information, including the text of the proposed amendments and supporting materials, please click here.

Applications Due on Feb. 24 for ABI’s Diversity Mentoring Program​​​

Applications are now being accepted for ABI’s Diversity Mentoring Program, hosted by our Diversity, Equity and Inclusion Committee to connect active or recently graduated business and law students with experienced insolvency professionals and ABI members who are offering professional development guidance. Throughout the program, mentors and mentees will meet bi-monthly to discuss a variety of topics with resources from ABI and members of the reorganization community, including judges, trustees, attorneys and accountants. For more information about the Diversity Mentorship Program and to apply to be a mentee for 2025-26, please visit ABI’s Diversity and Inclusion website at diversity.abi.org; applications are due February 24.

ABI Seeking Nominations for "Asset Sale of the Year"​​​

ABI’s Asset Sales Committee is seeking nominations for its Seventh Annual ABI Asset Sale of the Year award. Any bankruptcy sale that closed between January 1 and December 31, 2024, and involved at least one professional who is a member of ABI’s Asset Sales Committee (free for ABI Members to join) is eligible. Nominations are due February 28; for more information about the award and submitting a nomination, please click here.

INSOL International Looking for Candidates to Fill CEO Vacancy​​​

INSOL International, a cross-border nonprofit organization and catalyst for a wide range of ancillary groups representing the judiciary, regulators, lenders and academics, is looking for candidates to fill its Chief Executive Officer (CEO) vacancy. The position will play a key role in shaping the future of INSOL International by implementing the organization’s strategy, delivering initiatives, and expanding its influence and membership. For more information on the position and to submit an application, please click here.

Access All Current ABI Titles Through ABI’s New Digital Book Subscription!​​​

One of the best collections of bankruptcy books is now available as an annual digital subscription! ABI’s bankruptcy library opens the door to a constantly evolving area of the law, and our books are continually being updated by top industry professionals. Auto-renewing annual subscriptions guarantee immediate access to this invaluable resource, which is comprised of fully searchable content that’s always available on any digital device. Convenient pricing plans for individual and institutional subscribers offer immediate and unlimited access to our entire digital library of books — nearly 100 treatises! Plus, you get advanced access to new and revised books as soon as they are published — all included in your annual subscription. Learn more!

Have an Idea for a Topic for an ABI Conference Session? Submit Your Proposal via ABI’s “Call for Abstracts” Page!​​​

ABI has launched an online portal for professionals to submit proposals for educational sessions at future ABI conferences. Submitters can describe their proposed topic, outline the session’s focus and learning goals, suggest speakers, and provide contact information via the portal’s detailed form. The portal can be accessed here.

All submissions will be reviewed by an internal Education Committee, which will contact the submitter to ask questions as needed and to discuss the status of the proposal. Submissions will be reviewed on a rolling basis.

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