Bankruptcies Are on the Rise

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A study conducted by the American Bankruptcy Institute surveyed investors, attorneys, and financial institutions found that the number of bankruptcy filings will increase in the next six to 18 months. It also predicts a large increase in mid-market business bankruptcies during 2007. While the study does not point out the exact reasons for the increase in bankruptcies, one reason could be the hyper-liquidity of the financial markets. As a result, too much money is chasing too few good deals.

A slow economy and high interest rates have different effects on different industries. A detailed analysis is needed to determine how these factors will affect bankruptcies. In some industries, such as the energy industry, the economic environment has a dramatic impact. Moreover, many ostensibly “healthy” companies will also face the prospect of filing for bankruptcy.

The latest statistics on bankruptcy filings show that the number of filings has increased. As of August 2022, there were 35,355 filings. This was a ten percent increase over August 2021. However, while filings are up in the United States, they are declining in many areas. As a result, it is important to explore other options besides filing for bankruptcy.

When a company files for bankruptcy, they must be aware of the possible detractors that might accuse them of reneging on financial promises. They also need to prepare for the potential attacks of outside adversaries. These can disrupt the bankruptcy process and detract from the reputation of the company. In particular, companies should be aware of class action lawsuits, online ambushes, and hostile commentary in the local press.

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