Business Bankruptcy Rates Continue to Rise, Reports Euler Hermes ACI.OWINGS MILLS, Md. -- The number of U.S. business bankruptcies in the second quarter showed yet another dramatic increase, which reflects the forecast produced by leading accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying insurer Euler Hermes Euler Hermes International is a French credit insurance company owned by AGF which is also owned by European's Allianz SE. It claims to have 36% (2006) of the total credit insurance market. ACI ACI American Concrete Institute ACI Arch Coal Inc ACI Airports Council International (formerly Airport Associations Coordinating Council) ACI Automobile Club d'Italia ACI American Competitiveness Initiative earlier this year. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the U.S. Bankruptcy Courts bankruptcy court n. the specialized Federal court in which bankruptcy matters under the Federal Bankruptcy Act are conducted. There are several bankruptcy courts in each state, and each one's territory covers several counties. , 6,705 businesses declared bankruptcy bankruptcy, in law, settlement of the liabilities of a person or organization wholly or partially unable to meet financial obligations. The purposes are to distribute, through a court-appointed receiver, the bankrupt's assets equitably among creditors and, in most in the second quarter of 2007. This number shows a series of upward trends: * A 7% increase over the first quarter of 2007 * A 38% year-over-year increase from the second quarter of 2006 * A 45% increase for the first half of 2007 in comparison to the first half of 2006 "Businesses today are facing serious headwinds, including a slowing economy and an increase in the cost of doing business," said Euler Hermes ACI Chief Economist The Chief Economist is a single position job class having primary responsibility for the development, coordination, and production of economic and financial analysis. It is distinguished from the other economist positions by the broader scope of responsibility encompassing the Daniel C. North. He said that the three most serious issues remain the effects of increased energy, raw material, and labor costs; the effects of monetary policy tightening by the Federal Reserve in 2004-2006; and the "decimated" housing market and its effects on consumers and businesses. The housing market's recent effects on the financial markets have brought the seriousness of the situation to light, but North has been tracking - and predicting - the economic impact for nearly a year. "What first tipped me off was when median prices on existing homes fell for 10 consecutive months on a year-over-year basis, which is an unprecedented event since house prices almost never fall; they have never fallen for more than two months in a row in the 38 years that records have been kept," he said. "This is an obvious sign of a rapidly deflating asset bubble, the effects of which will continue to be felt for some time to come." Euler Hermes is forecasting a return to 30,000 business bankruptcies in 2007, a 51% increase. North said the increase will bring bankruptcy numbers to "more normal levels" following a spectacular, but one-off, reduction in business failures in 2006. Euler Hermes ACI is North America's oldest and largest provider of trade credit insurance and accounts receivable management solutions and is the US subsidiary of the Euler Hermes Group. Headquartered in Owings Mills, MD, the company protects and insures more than $150 billion in US trade transactions annually. For more information, visit www.eulerhermes.com/usa. |
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