In 2008, there were 64,318 corporate bankruptcy filings across the U.S. This is the highest since 1992. What is most disturbing about this fact is that more than half (34,358) of the 64,318 filings occurred in the last quarter of 2008. Yes, that is right. We had 34,358 filings in the fourth quarter of 2008. The second highest total in the last 15 years was 2nd quarter of 1997 when we had 13,991 filings. So we have had nearly three times the corporate bankruptcy filings in the last quarter than any previous quarter in the last fifteen years. Mind you, this is at a time when DIP (Debtor in Possession) financing is next to impossible to find – so it’s likely that many of these filings were liquidations (e.g. Circuit City).
We need action now above and beyond the stimulus bill. The lack of action, punctuated by the precipitous drop in the market this past week, frightened the most prominent Wall Street Investment banking firm, Goldman Sachs, to call together a meeting with about 20 of the firm’s biggest hedge fund and private equity clients to discuss the crisis.
Gentlemen and Lady, we need prompt, decisive action or the situation will get much worse!
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Being a resident of South Florida I can say that the US downturn has definitely hit home--and the bankruptcy statistics show the pain we are feeling. Business bankruptcy filing in the Southern District of Florida spiked to 1,403 in 2008, an 80% jump from 2007. In fact, the 1,403 number is the most business bankruptcies ever recorded in South Florida since at least 1990 (the US bankruptcy data only goes back to 1990).
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