It all began in the United States with the burst of the real estate bubble and the disclosure of the sub-prime mortgage fiasco. In 2008 Bear Stearns Co., an investment bank ran into deep trouble and JP Morgan Chase & Co. took them over. Merrill Lynch & Co. Inc. experienced the same financial crisis and Bank of America absorbed them.

Of course, the demise of Lehman Brothers Holdings Inc. sent shockwaves throughout the worldwide financial industry. Then there were the bailouts of American International Group Inc. (AIG) and Citigroup Inc. These bailouts came from the United States government, meaning U.S. taxpayers.

Microsoft just announced big lay-offs, as have Starbucks, Caterpillar, and more. The Big 3 automakers in the United States are teetering on the brink –General Motors Corp., Ford Motor Co., and Chrysler LLC. Will their rescue packages help restore them to financial health? It is the big question in this sector for 2009.

However, this turmoil does not confine itself to the United States. It may have begun there, but the contagion has spread worldwide to those tied into the U.S. economy in one form or another. On the High Streets in the U.K., things are not much better. Businesses are grappling with reduced demand for their products and services as well, especially in retailing.

The High Street is a figure of speech for a generic and sometimes official name of the "main business street" of towns and cities in the United Kingdom. These are where the shops and retailers are, and High Street often refers to retailing. High Street is the most common street name in the United Kingdom. On the High Street, businesses are dealing with tight credit, slowing consumer demand, and shrinking economies.

According to an article by Jane Moir in the Business Times (December 5, 2008) corporate failures could increase by fifty percent in 2009. In addition, by 2010 corporate failures could hit record highs. A report by accountants BDO Stoy Hayward forecasts 32,000 businesses will go under in 2009. The figure may approach 32,400 in 2010 according to the firm. The record in Britain is 33,900 in the 1992 recession.

In the U.K, the burst of the real estate bubble and the banking crisis is wreaking havoc on the High Street. Construction firms in the U.K. are experiencing decline in demand for their services as the property market fizzles and with banks reluctant to lend, businesses and consumers are in a bind. It's a vicious circle of less shopping, which leads to more companies reducing their workforce, and this in turn means these laid-off workers will shop less as they fight to conserve money. 

It's a contagion that has hit all of Western Europe. Euler Hermes, the large Paris, France credit insurer recently issued a report on global business insolvencies. They said they expect the number of insolvencies in Western Europe to rise to 197,000 in 2009. United Kingdom firms will comprise a significant portion of this number.

Look at the following list of those High Street enterprises now mired in a financial mess:

  • Do-it-yourself chain Focus, as well as Land of Leather have asked for concessions from their landlords. This is according to a report in the guardian.co.uk/TheObserver on November 30, 2008 in an article by Nick Mathiason.

  • The Officers Club, the largest menswear-only retailer in Britain is up for sale. They have 160 stores.

  • Woolworth's went into administration as December 2008 arrived. So did kitchen and furniture retailer MFI. Combined potential job loss from these two companies is 31,000 people.

  • Sixty UK, the parent of fashion retailer Miss Sixty has also gone into administration. They will undergo a corporate restructuring.

  • Men's retailer Moss Bros. issued an earnings warning concerning their 2008 numbers to analysts and investors.

  • The electrical retail conglomerate DSG moved from a profit position into red ink. They are the owner of Currys and PC World.

  • Strategic Retail (owner of home decorating chain Fads) commented that there is significant deterioration of trading conditions in the U.K.

With so many national economies intertwined, 2009 will need a concerted and coordinated effort from governments and business to stem the recession. If this doesn't happen, we may have to start using the "D" word...Depression. Who would have thought it would come to this after the booming 90s and new millennium.

Authorities around the world are frantic to avoid using this term. We are definitely in uncharted and frightening economic waters. Our generation is experiencing a time we may only ever have heard our grandparents' speak of from a personal perspective. It's going to take a return to reputable, basic business acumen and fundamentals to make the High Street and all other streets jumping with activity once again.