When you are in a business, you must take upward and downward market trends in stride. The downward cycles, or the recessions as they are called are the challenging times for you since these are the times when the major risk takers are seen filing bankruptcy.

Those who learn from their mistakes are wise but those who learn from other’s mistakes are smart. The recession times offer you the opportunity to become such smart, since you see many highly qualified and experienced people being victims of recession just because they could not foresee these situations and took wrong decisions before the crisis set in.

Here comes the smart people who study their mistakes and learn form them in order to make their business recession proof.

Take for example the recent economic depression of 2008 due to sub prime securities. The first mistake was in giving loans at a higher (sub prime) rate to those, whose credit rating was low.

These loans were then treated as securities and refinancing was done without properly scrutinizing their background or maybe overlooking the same, tempted by higher interest rates.

Those who were smart learnt from these mistakes committed by some of the most experienced financial firms like Lehman Bros. In future before financing anyone, they will first scrutinize their credit ratings.

Recession times are also opportunity times for some. During this period, the law of survival of the fittest prevails and we are left with companies with strong foundations only to deal with resulting in stable business. Many new products and services are also being developed during the recession times since various companies’ need something new to sustain their businesses.