Economists at Pricewaterhouse Coopers (PwC) believe that nearly 30,000 businesses in the UK will fold under the weight of high interest rates in 2024. Company insolvencies will increase by 15% as repayments on debts soar in an effort to keep them solvent. 
This figure of nearly 30,000 companies closing is greater than the number of insolvencies experienced by the UK in the immediate aftermath of the world economic banking crisis of 2008 when around 24,000 firms collapsed. 
 
Caroline Sumner, chief executive of the UK’s insolvency and restructuring trade body, surmised that insolvencies in 2023 were already “incredibly high” and that “What we appear to be looking at now is sustained volatility for the foreseeable future, where it is likely that insolvencies will remain relatively high.” 
Unfortunately, “relatively high” doesn’t really capture the bleak reality, with the last round of quantitative easing (QE) in 2020 brought in to encourage borrowing on a mammoth scale. Ultimately these debts must be repaid and whilst QE may have helped with economic growth, stable employment levels and spending, it does come with some significant consequences. 
 
QE increases the price of bonds, shares, and property, which are often only held by the wealthy, so again the rich become richer, whilst the everyday person and the younger generation struggle to save and make ends meet. Furthermore, when bond prices go up, so does the cost of providing future pensions. As a result, many companies were obliged to make bigger pension contributions, reducing monies available to use in investments and business security, meaning some will have chosen to close pension schemes entirely. 
Georges Ugeux, an expert in international banking and finance, gave a stark warning that “I think we are in danger of a serious financial crisis that nobody talks about because of the level of debt the governments and corporations have been able to borrow at very cheap rates. There is no exit strategy, and we cannot go forever in the direction we have been going.” 
 
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