The Canadian and American central banks are pulling out all the stops to support the economic recovery, with the latest move being their indications that they expect to hold interest rates near zero over the next few years. However, as the COVID-19 pandemic persists, the hoped-for sustained revival in consumer borrowing and spending is anything but certain. In an unprecedented move on Sept. 16, the U.S. Federal Reserve said it doesn’t expect to raise its key interest rate until 2023, providing a very powerful signal that near-zero rates are here to stay for a long time. A week earlier, the Bank of Canada had said, “The Governing Council will hold the policy interest rate at the effective lower bound [0.25 percent] until economic slack is absorbed so that the 2…
Small businesses will be protected from needlessly being wound up under changes to be announced by the Morrison government on Sept. 24.
Key elements of the reforms include:
* Moving from a one-size-fits-all “creditor in possession” model to a more flexible “debtor in possession” model, allowing eligible small businesses to restructure existing debts while remaining in control of their business
* A period of 20 business days to develop a restructuring plan by a small business restructuring practitioner, followed by 15 business days for creditors to vote on the plan
* A simplified liquidation pathway for small businesses
* Red tape cuts for the insolvency sector.
The changes follow the extension earlier this month of temporary insolvency and bankruptcy protections to support small businesses impacted by the COVID crisis.
As the temporary relief expires at the end of December, the number of companies being put into external administration is expected to increase.
Reserve Bank governor Philip Lowe warned of the wave of business failures in August.
“There will be insolvencies. There will be bankruptcies. There will be some businesses that will not recover. That’s the harsh reality of an economic downturn that’s the worst in 100 years,” he told parliament’s economics committee.
The longer-term reforms are earmarked to start on January 1, subject to parliament passing legislation.
By Paul Osborne
Focus News: Insolvency Reforms to Help Aussie Small Businesses
Facebook has shut down more than 180 fake accounts, groups, pages, and Instagram accounts that it determined to be run in China, which posted content on the U.S. presidential election and spread Beijing’s talking points on a range of topics, from the South China Sea to Hong Kong protests. The U.S. social media giant announced the takedown in a blog post published on Sept. 22, saying that these accounts were a violation of its rule against “coordinated inauthentic behavior on behalf of a foreign or government entity.” In total, 155 Facebook accounts, 11 pages, nine groups, and six Instagram accounts were shut down. The Instagram app is owned by Facebook. Nathaniel Gleicher, Facebook’s head of security policy and author of the blog post, explained that while people behind these accounts…