The last type of business to fail during a recession are banks. Bank failures in the USA, for example, climbed from 6 in 1977 to 42 in 1982 and 48 in 1983. From 1982 to 1988 some 620 American banks failed, or have been forced to merge, and 100 savings and loan institutions have closed and another 350 have been declared insolvent. These thousand-odd banking failures have involved 7% of the total domestic deposits in savings institutions in the USA. It has been estimated that the cost to the government of protecting investors may total over $500 billion over the next 30 years.
2. In the USA, for example, bankruptcy laws have been amended to allow for reorganization of the enterprise and time to pay its debts in an orderly fashion. Therefore bankruptcy does not automatically mean failure or business liquidation but can be a safety-net or a last chance to save a business. In China bankruptcy is now being considered as an legitimate way of controlling inefficient loans.
3. The opulence of the front office decor varies inversely with the fundamental solvency of the firm.