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Bankruptcy Avalanche Is Not Over Yet
-- March 28, 2003

The threat of large-scale bankruptcies of U.S. companies is still a ticking time bomb for the economy. The number of bankruptcies may have shrunk in the first quarter, but we've identified several companies that are set to explode in the coming months. Plus, the size of the failing companies, more than the quantity, is what will rock the economy to its core.

American Airlines and HealthSouth are just two of the large companies we expect may file for Chapter 11 bankruptcy protection over the next few months. At present, we have about a dozen others on "bankruptcy watch." Here are just a few:

Then, there's Gateway, CKE Restaurants, Earthlink, Nortel Networks, Primedia, and Silicon Graphics. These companies are drowning under massive debts ... experiencing catastrophic earnings losses ... suffering from dwindling or nonexistent cash flow ... or a combination of these problems. Each one of them is a candidate for bankruptcy, in our view.

All of them are very large companies, and their failures will hit the economy like a ton of bricks.

related article: Company Bankruptcies Down in 1st Quarter