Have you opened any folders recently?
The menu will be grayed out if there are no "recently used" folders, like if you Clear the menu.
As I realize that is probably not likely, there may be something causing it to not record the recently used folders. I don't know what that would be.
You can try running in Safe Mode to see if you can replicate it there. If it works in Safe Mode, that would indicate something installed at startup is interfering.
Also, try running as Guest or another user and see if the problem is there. If it works in other users, that would indicate it is something that runs when you log into your account.