Bankruptcies for Businesses Up
Currently the United States is working through a credit crunch in the consumer housing sector due to a wild ride and bad loaning practices - funding non-credit worthy individuals with little or no money down at too low interest rates at the top of a housing bubble. Should have known better, well yes obviously, but irrational exuberance is part of the realities of Turbulent Economic Times.
When too many homes are being foreclosed on and too many banks are taking a bath with walk-a-ways and dead beats we all pay. It has been affecting the strength of financial markets and causing havoc. But one thing not many people are discussing is that Business Bankruptcies are trending upwards too and in the third quarter of 2007 they were up nearly 8% over the second quarter - ouch.
Worse business bankruptcies are up 33% over the second quarter of 2006 and Industry Week recently reported that there was a 45% increase in the first half of 2007 over the first half of 2006. Now some have speculated that the change in bankruptcy laws in 2005 did change the numbers and it makes it hard for us to judge these things, but these figures are scary when you consider the implications.
As the economic advisor for the Online Think Tank, I am troubled by these trying times and would rather not promote bad news, as I also realize that one-third of our economy is as much about perception and confidence as it is about reality and monetary flow. Some would say that the party is over and since we are in an election year, it will be extremely fun to watch.
"Lance Winslow" - Online Think Tank forum board. If you have innovative thoughts and unique perspectives, come think with Lance; http://www.WorldThinkTank.net/. Lance is a guest writer for Our Spokane Magazine in Spokane, Washington
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