Bankruptcy filings should surge in 2012 because the foreclosure pace is picking up speed, and because the world and U.S. economies are not headed for improvement in the near future.

I.          Foreclosures In 2012

I haven’t written about foreclosure in a while, but an article in the Thursday Los Angeles Times has given me the impetus to do so.

In the January 12, 2012 Business Section, E. Scott Reckard reported:

California and other states are likely to see an enormous wave of long-delayed foreclosure action in the coming year as banks deal more aggressively with 3.5 million seriously delinquent mortgages.  And experts said that dealing with the foreclosure process, from issuing notices of default to selling repossessed homes, is likely to push housing prices lower this year before the real estate market has a chance to recover.

Wow!  Three and a half million seriously delinquent mortgages.  That’s a lot of toxic real estate.  If you’re one of those 3.5 million people with a seriously delinquent mortgage, isn’t it time you considered bankruptcy?

II.        The World Economy

Is that the only bad financial news?  You know better than that.  Here’s what Sue Chang of the Wall Street Journal’s Market Watch reported on Friday, January 13, 2012:

Standard & Poor’s late Friday stripped France and Austria of their triple-A ratings and also downgraded Spain, Italy, and Portugal.  France and Austria are now both rated AA+ while Spain is at A and Italy is rated BBB+.  Meanwhile, Portugal’s rating was slashed to a junk grade of BB.  The move had been anticipated after the ratings agency placed 15 euro-zone countries on CreditWatch negative in early December.
Continue Reading The 2012 Foreclosures, The World And U.S. Economies, And Bankruptcy

In my last post I discussed the nation’s financial condition, and contrasted national bankruptcy with personal bankruptcy.  In this post I will contrast the nation’s credit rating with personal credit rating.

I.          The Nation’s Credit Rating

Some time ago I wrote “Bankruptcy And Your Retirement Accounts”, in which I talked about the growing problems with retirement funds that had invested in various types of government debt.  I observed that since many states and municipalities had large unfunded obligations on such things as employee pension and medical plans, the quality of some state and municipal bonds as investment vehicles could be headed toward junk bond status.  In passing I referred to the recent downgrading of federal debt.

Well, it looks like a further downgrading of federal debt is in the offing – perhaps even before Christmas.
Continue Reading Personal Credit Rating And National Credit Rating

If you’re considering filing for bankruptcy protection, you’re not alone.  Large numbers of your fellow citizens are thinking the same thoughts.  And large numbers have already filed for bankruptcy protection this year – I’ll give you the exact number later in this post.  But what about the nation as a whole?  How is it doing?

I.          National Bankruptcy?

In the November 17, 2011 Los Angeles Times Michael A. Memoli reported:

The Treasury Department confirmed this week that the national debt has surpassed $15 trillion – that’s 15, followed by 12 zeros . . .

A little more than a week earlier, in the November 7, 2011 Los Angeles Times, Mr. Memoli reported:

The federal government recorded a $1.3-trillion budget deficit in the 2011 fiscal year, roughly even with the previous year’s shortfall.

What does this mean?
Continue Reading Personal Bankruptcy And National Bankruptcy

Bankruptcy is an effective way of wiping out debt, and it can be an important tool in preparing for what some experts predict will be the next great depression. 

Thomas H. Kee Jr. is the president and CEO of Stock Traders DailyHe has accurately predicted market cycles in advance using his multi-tiered technical indicators since starting Stock Traders Daily in January 2000. 

On October 12, 2011, Mr. Kee wrote the following in the Wall Street Journal’s MarketWatch

The U.S. economy, and probably the global economy as a result, are headed towards a Greater Depression, and there is nothing anyone can do to stop it now . . . [T]he only saving grace may be China, but China seems to have gotten so far ahead of itself that eventually it too will fall. . . . [T]he only solid promoting market based stability has been the demand from BRIC [Brazil, Russia, India, and China] countries, mostly China, and if that pares back the result will devastate the global economy as we know it today. . . . Eventually there will be a material hit to these BRIC economies, and the fragile nature of mature economies will not be able to offset that weakness. [I]f China were to suddenly experience an uncontrolled decline in GDP, global stock markets would collapse, corporate earnings would crumble, the unemployment rate would skyrocket . . .

But China is in no danger of economic collapse, right?  Hmmm. 
Continue Reading The Next Great Depression And Bankruptcy