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"People are hurting, and it is showing up in the bankruptcy courts." This statement, profoundly simple then and depressingly obvious now, is from the March 2008 blog of University of Illinois law professor Robert Lawless. Two months later, Lawless, a national expert on bankruptcy trends, explained to Newsweek, "People borrow to stave off the day of reckoning, and then when credit tightens, the bankruptcy numbers go up." By the end of the year, Lawless got specific: "For 2009, I am expecting a little under 1,400,000 bankruptcy filings." In early October 2009, Lawless's skill as a prognosticator was substantiated. Using data...

General Growth Properties Inc. said Wednesday that it has filed its reorganization plan, and its lenders have agreed to restructure about $9.7 billion in shopping mall mortgage loans, more than previously planned. Last month the mall operator, which earlier this year filed the largest U.S. real estate bankruptcy case in history... The company had about $27 billion in debt piled up at the time. General Growth, based in Chicago, is the second-largest U.S. mall operator.

The Democratic Party has always sold itself as the advocate of the little guy. They are out to make life better for the poor, for minorities, and for women. They aim to balance the inequality of opportunity, and protect them from abuse by the rich. And they do all of this for the good of society. But their policies help none of these contrived factions. In fact, they hurt them. The tacit assumption behind all Democratic policies is that government can help the little guy better in a burdened economy than he can help himself in a robust economy. The...

Decline of the City (and) State Submitted by Marla Singer on 11/29/2009 19:29 -0500 /snip After all, direct democracy (and the mob rule that accompanies it) had killed Socrates, hadn't it? That Plato dedicates The Republic partly to the import of the Philosopher King years later might have been predictable. In the spirit of this background, enter San Diego, a year ago last week: Lame duck City Attorney Michael Aguirre will ask the City Council during a closed-door hearing today to consider hiring legal counsel to explore taking San Diego into bankruptcy. Aguirre said Chapter 9 bankruptcy protection would allow...

It's one of those numbers that's so unbelievable you have to actually think about it for a while... Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that's not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from? How did we end...

U.S. bankruptcy filings rose 33 percent in the third quarter to the highest number since 2005, government data show, as rising unemployment and tight credit made it more difficult for consumers and businesses to stay current on their debts. "With unemployment surpassing 10 percent and credit to businesses remaining tight, consumers and businesses are increasingly turning to the financial relief of bankruptcy," said Samuel Gerdano, executive director of the nonpartisan American Bankruptcy Institute, in a statement. There were 388,485 filings in the July-to-September period, up from 292,291 a year earlier and up 2 percent from the second quarter's 381,073, according...

Anxious to avoid raising taxes too much to pay for their healthcare proposals, the Obama administration and its congressional allies hit on a great new idea: Make the states raise their taxes to fund the program instead. Both the House and the Senate bills require that states cover a larger percentage of their people under Medicaid — a joint state and federally funded program. The idea was to force the states to raise their taxes to cover a big part of the healthcare bill for treating poor people. Since the Feds simply can charge any increase in spending to their...

The total combined national debt has just officially hit $12. In the 300+ days that Obama has been our president, Obama and Pelosi have accumulated more than $1.4 trillion dollars of debt, an astounding rate of increase of nearly $4.7 billion a day. Congratulations federal government, you're the best! Our children and grandchildren will really appreciate it.

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As reported earlier today, ACORN filed suit against Congress in federal court to overturn the congressional act cutting off their funding. The timing of the law suit was very strange, unless Congress acts again the government spigot turns back on in the middle of December. Why didn't they wait a month before spending the legal fees? One reason is that the ACORN suit isn't only asking for the spigot to be turned back on, it asks for the government to give back the money that it would have received if they weren't cut off in the first place. The Lawsuit...

Jefferson's criminal sentencing, bankruptcy hearing a month apartBy Jonathan Tilove November 03, 2009, 6:52AM Former Rep. William Jefferson will face sentencing Nov. 13 on 11 counts of federal public corruption. But it will not be the last court hearing this fall for Jefferson. On Dec. 9, if he is still a free man, Jefferson is due to appear before Judge Jerry A. Brown in United States Bankruptcy Court in New Orleans to argue that he and his wife should be able to keep their wedding rings and that his family has the right to hold onto one of his guns....

Never a pleasant statistic, the American Bankruptcy Institute today released the numbers for American bankruptcies that occurred in October. Bankruptcies are on the rise, despite previous legislation that made it harder to file: ABI (via Reuters): The 135,913 consumer bankruptcy filings in October represented a 27.9 percent increase over last October’s monthly total of 106,266, according to the American Bankruptcy Institute (ABI), relying on data from the National Bankruptcy Research Center (NBKRC). The October 2009 consumer filings represented an 8.9 percent increase from the September 2009 total of 124,790. Chapter 13 filings constituted 28.5 percent of all consumer cases in...

CIT Files Chapter 11, 76.5% Of Creditors Vote For Prepack (90% of 85% Voting) http://www.zerohedge.com/article/cit-chapter-11

Commercial Lending Giant CIT Files Bankruptcy Government to likely lose $2.3 billion it spent to prop company up last year NEW YORK - Lender CIT Group has filed for bankruptcy protection, in an effort to restructure its debt while trying to keep loans flowing to the thousands of mid-sized and small businesses. CIT made the filing in New York bankruptcy court Sunday, after a debt-exchange offer to bondholders failed. CIT said in a statement that its bondholders have overwhelmingly approved a prepackaged reorganization plan which will reduce total debt by $10 billion while allowing the company to continue to do...

Update | 3:46 p.m. Three months ago, the CIT Group barely averted what it considered to be a ruinous bankruptcy filing that would likely have put the 101-year-old lender out of business. On Sunday afternoon, the company filed for Chapter 11 — but under a so-called prepackaged bankruptcy plan that will enable it to emerge from court protection by the end of the year, under the control of its debtholders. (Read the filing after the jump.) The filing, made in a Manhattan federal court, will still mean much pain for many parties, beginning with taxpayers. CIT received $2.3 billion in...

CHICAGO - Capmark Financial Group, one of the largest U.S. commercial real estate lenders, has filed for bankruptcy protection amid mounting bad debt, becoming the latest casualty in the still turbulent U.S. real estate market. Capmark has been hurt by rising losses on mortgage loans, and has had to foreclose on properties such as the Equitable Building in Atlanta because borrowers were not able to make loan payments. In its bankruptcy filing Sunday in Delaware bankruptcy court, the company listed total debt of $21 billion and assets of $20.1 billion. It seeks to reorganize under court protection, reducing its debt...

The real 2008 federal budget deficit was $5.1 trillion, not the $455 billion previously reported by the Congressional Budget Office, according to the 2008 Financial Report of the United States Government released by the U.S. Department of Treasury, Jerome Corsi's Red Alert reports. The difference between the $455 billion "official" budget deficit numbers and the $5.1 trillion budget deficit based on data reported in the 2008 financial report is that the official budget deficit is calculated on a cash basis, where all tax receipts, including Social Security tax receipts, are used to pay government liabilities as they occur. The calculations...

WILMINGTON, Del. - The Chicago Cubs baseball team filed for Chapter 11 bankruptcy protection Monday, a step that will allow its corporate parent to sell the team in an $845 million deal. The filing in Wilmington, Del., was anticipated and is expected to lead to a brief stay in Chapter 11 for the Cubs. It comes as part of the Tribune Co.’s plans to sell the team, Wrigley Field and related properties to the family of billionaire Joe Ricketts, the founder of Omaha, Neb.-based TD Ameritrade.

[Full title was edited to comply with space requirements, here's unedited version:] "Well-Kept Media Secret: UAW Conceded No Base Pay, Health, or Pension Benefits in GM, Chrysler Bankruptcy Run-ups" A New York Times article by Nick Bunkley on Friday targeted for print on Saturday about the status of contract talks between Ford Motor Company and the United Auto Workers piqued my interest in a previously neglected but important matter. Ford and the UAW are apparently close to an agreement. In describing what Ford workers are being asked to give up, Bunkley wrote the following (bolds are mine throughout this post):...

Two weeks ago, we noted that CBS had been pinpointed by Audit Integrity as one of 10 big companies at risk of bankruptcy. This prompted an outraged denial by CBS. As the banking collapse illustrated, any time a company denies that it's about to go bankrupt, it makes sense to assume that the company is indeed about to go bankrupt--and then analyze the situation for yourself. We've now done that for CBS. Here's the bottom line: CBS is not on the verge of bankruptcy. The company is, however, highly leveraged, and its cash flows have been deteriorating rapidly. So if...

InkStop Inc., a specialty retailer of ink, toner, consumer electronics and other supplies for small businesses and home offices, abruptly told its employees that it was shuttering all 152 stores nationwide as of Friday and laying off all workers until further notice. "The company has elected to temporarily close all stores at the close of business today, Oct. 1, to focus on a restructuring plan in an effort to improve the overall operations of the organization," the Warrensville Heights company told employees in a letter sent late Thursday.

Consumer bankruptcies topped one million for the first nine months of this year, the highest point since the system was overhauled in 2005. The number of personal bankruptcy filings for the nine months rose to 1,046,449 as of Sept. 30, the American Bankruptcy Institute, an organization made up of attorneys, accountants and other bankruptcy professionals, said Friday, using data from the National Bankruptcy Research Center. There were 773,810 personal bankruptcy filings for the same time period in 2008. September's filings reached 124,790, 41% higher than the same month last year. The 2005 revamp was intended to make it harder for...

UPDATE 3-Serta owner to buy Simmons in $760 mln deal Sat Sep 26, 2009 1:29am IST (Recasts, adds information about Serta) * Simmons and Serta combined beat out Sealy * Simmons will file for bankruptcy By Caroline Humer NEW YORK, Sept 25 (Reuters) - Mattress makers Simmons and Serta are planning to dethrone competitor Sealy as the world's largest mattress company in a $760 million deal that includes Simmons filing for bankruptcy. Simmons Co said on Friday that it has put together a restructuring plan to be sold to private-equity firm Ares Management LLC and a unit of the Ontario...

Six Colorado dairies have filed for bankruptcy protection this year amid banking problems and low milk prices. Four of the banks had loans from Greeley-based New Frontier Bank, which collapsed in April... Bob Winter, a member of the Colorado Farm Bureau, says he believes more Colorado dairies are preparing to file for bankruptcy protection

The government's temporary guarantee program for money market funds is set to expire on Sept. 18. There is little chance the year-old program, put in place during the height of the financial crisis, will be extended past next week. The guarantee applies only to money funds that paid premiums to participate in the Treasury Department's insurance fund. Almost all funds did initially, although some that invest only in U.S. government securities later dropped out. The guarantee covered balances that were in participating taxable and tax-free money funds when the program started Sept. 19. "It's extremely unlikely" the program will be...

"Letting Lehman fail was perhaps the only thing governments have done right during this whole drama,". Rogers argues that the government's actions to rescue Long Term Capital Management ten years ago created systemic risk based on the assumption that the government would ride to the rescue. "Had the central bank allowed the failure of Long Term Capital Management to run its course, Lehman, Bear Stearns, et al would still be here,"

SAN FRANCISCO — The company that owns The Orange County Register in California and dozens of other newspapers on Tuesday became the latest publisher to seek bankruptcy protection, driven into financial despair by a staggering drop in advertising revenue.

Former Comptroller General of the United States David Walker has been sounding the warnings of impending Federal bankruptcy for years. The largest problem is Federal health care entitlements — a factor to be seriously considered as Congress debates yet another proposed health care entitlement bill. [Videos]

I'm in the middle of an audit and I need records from a company that went bankrupt recently. The name is True North Home Systems in Kennebunk Maine. I last contacted them in January and they have since went belly-up. I have been in contact with the locality, (no response/ answer) and have been to the State dept of commerce, state atty gen, state court and nothing of any consequence has been provided. Am I looking in the right place?

Georgia’s only corn ethanol plant could be running out of gas. First United Ethanol LLC has limited liquidity and could slip into the arms of bankruptcy protection, the company warns in filings with the Securities and Exchange Commission.

With annual revenue of more than $2 billion, the Reader’s Digest Association may be the largest magazine publisher to ever file for bankruptcy. But it probably won’t be the last this year. The private-equity frenzy of the past decade, combined with the unprecedented downturn, has caught up with the industry. So far in recent months, supplier companies including distributor Source Interlink and printer Quebecor World filed for protection, and publishers including the newspaper giant (and owner of Connecticut magazine) Journal Register Co. and Cygnus Business Media have as well. Summit Business Media is said to be in the process of...

NEW YORK (Dow Jones)--The Reader's Digest Association Inc., which was taken private just over two years ago, said it reached an agreement with its lenders on a restructuring plan that it will likely complete under a prepackaged bankruptcy filing in order to reduce its debt. The company, which publishes the magazine of the same name and also has marketing operations, also chose not to make a $27 million interest payment due Monday on its 9% senior subordinated notes due 2017. It said it would use the 30-day grace period available to continue discussions with its lenders. Under the debt-restructuring deal,...

Reader's Digest Association Inc, publisher of the widely-read Reader's Digest magazine, said on Monday it would likely file for Chapter 11 bankruptcy for its U.S. businesses to cut its debt load. The media company, known worldwide for its family-friendly namesake magazine, been trying to slash costs and boost growth since it was taken private in 2007 by an investor group led by Ripplewood Holdings LLC. The bankruptcy would take the form of a so-called pre-arranged filing, Reader's Digest said in a statement. A pre-arranged filing comes after a company has already reached deals with its lenders to cut its debt.

Downturn Pushes Escada into Bankruptcy Escada, the German luxury fashion brand, filed for bankruptcy protection with a Munich court, Bloomberg reported on Thursday. Escada was badly hit by the global economic downturn and had been negotiating with bondholders to restructure its debts, but the negotiations were broken off on Tuesday. Along with the recent bankruptcy of Lacroix, the French luxury clothing brand, the Escada case reveals the heavy toll the recession is taking on the high-end fashion industry. According to French newspaper Le Monde, Italian luxury fashion brands are also suffering from serious financial woes. Gianfranco Ferre, one of the...

Western U.S. Remains Hardest Hit Region ATLANTA, Aug. 10 /PRNewswire-FirstCall/ -- Commercial bankruptcies among the nation's more than 25 million small businesses increased by nearly 81% in June 2009 from June 2008, according to Equifax Inc. (NYSE: EFX), which analyzed its comprehensive small business database for the study. There were 10,339 bankruptcy filings in June 2009 throughout the U.S., up from 5,712 a year ago, according to the data. California is the most negatively affected state with 10 MSA's (metropolitan statistical areas) among the 15 areas with the most commercial bankruptcy filings during June. Los Angeles, Riverside/San Bernardino and Sacramento...

VALLEJO -- After almost a year of legal wrangling, Vallejo's labor unions have dropped their appeal of the city's bankruptcy filing, removing one of the final obstacles to the North Bay city's financial restructuring. The city's fire and electrical workers' unions withdrew their appeal to the Ninth U.S. Circuit Court of Appeals in San Francisco late Thursday. The unions had challenged the city's accounting, saying that money was shifted from the general fund into other accounts to give a false appearance of financial ruin and as a means to scrap its labor contracts. Union officials did not return phone calls...

Total filings reached 126,434 in July, a 34.3% increase from the same period a year ago and an 8.7% increase over June, according to a report released Tuesday from the the American Bankruptcy Institute.

As everyone else’s taxes rise, one favored outfit may not have to pay federal taxes for years: General Motors. In another sweet deal from its benefactors on Pennsylvania Avenue, the government-owned car company is set to profit from billions of dollars in tax breaks not available to other businesses in the same predicament.

The events of the last year have produced a flurry of legislation so complex, and debated and passed so quickly, that most of the citizenry (not to mention the members of congress) have no idea what the government has passed and how much we are spending. Enter Neil Barofsky. Barofsky is an economist who also happens to be the special Inspector General for the Troubled Asset Relief Program (TARP). In his report to Congress yesterday, he outlined that the cost allocated to all of the programs passed to deal with the economy, including those by the Federal Reserve that did...

The House passed a Treasury appropriations bill last week that includes an amendment reversing President Obama on the closure of nearly 800 Chrysler car dealerships and more than 2,000 GM dealerships. The amendment sponsor was Republican Steve LaTourette of Ohio. 215 Democrats and 4 Republicans voted for the overall package. Bipartisanship! The most snort-worthy reaction from the White House: The White House said Wednesday it strongly opposes the measure, arguing it would “set a dangerous precedent, potentially raising legal concerns, to intervene in a closed judicial bankruptcy proceeding on behalf of one particular group.”

We've become slightly famous for accurately predicting the demise of several iconic America companies, including the original AT&T, GM, Fannie Mae, Freddie Mac...

Democratic Sen. Christopher Dodd has been going around talking up KennedyDoddCare by claiming "62 percent of all personal bankruptcies were caused by medical problems." His source was so-called research by Physicians for a National Health Program (PNHP), hardly a disinterested bystander. To achieve that lofty number, it had to distort the definition of medical bankruptcy while failing to control for household overspending, the No. 1 cause of personal bankruptcies in the aftermath of illness or injury. But when medical bankruptcies are more accurately defined as those attributable solely to medical-related costs beyond a household's control, the rate plummets to just...

The Congressional Budget Office (CBO) has projected that at current rates of spending, the federal government is facing bankruptcy within the next decade or less. “Federal budgetary outlays have been growing faster than the ability of the economy to support them for some time now,” declared CBO Director Doug Elmendorf. “Government borrowing is crowding out the private sector’s ability to obtain credit. This is further depressing tax receipts, worsening the deficit. Monetization of the deficit by the Federal Reserve is undermining the value of the dollar. Unless the burden of government is reduced bankruptcy is almost certain.” Vice-President Joe Biden...

Joe Biden's mouth just made its daily appearance in the news...

“Now, people when I say that look at me and say, ‘What are you talking about, Joe? You’re telling me we have to go spend money to keep from going bankrupt?’” Biden said. “The answer is yes, that's what I’m telling you.”

If the bad economy has you thinking of taking on debt to go to grad school, consider the case of Mark Jesperson. The federal case. The Eighth U.S. Circuit Court of Appeals has ruled that the 45-year-old Grand Marais man cannot escape more than $350,000 of student debt he piled up over more than a decade. Jesperson had hoped to discharge the debt in bankruptcy and won the first couple rounds in court. But last week a three-judge panel reversed the lower courts' decision and said he must pay the money back. While the dollar amount involved is unusual, experts...

CHICAGO (Reuters) - The Chicago Cubs baseball team may file for Chapter 11 in order to speed its sale by bankrupt media company Tribune Co (TRBCQ.PK), two sources familiar with the process said on Monday. "It's pretty certain that they will do it," said one of the sources, who asked not to be identified because the sales process is continuing. Such an approach would likely be taken to ensure the storied baseball team and related assets are free of liabilities so as to speed a sale, said the other source, who also asked not to be identified. Tribune filed for...

<p>DETROIT -- General Motors Corp. appeared headed toward a record-short escape from bankruptcy protection Thursday despite a last-minute appeal that a legal expert said was unlikely to stand in the way.</p> <p>A bankruptcy judge's order approving the sale of most of GM's assets to a new company was to go into effect at noon. An appeal was filed just before the deadline by plaintiffs in an Arizona product liability lawsuit against the automaker. It was unclear if the appeal delayed the sale approval.</p>

He garnered some sympathy from two lower courts, but a three-judge appeals panel isn't letting a Minnesota lawyer off the hook from repaying his massive student loan debt. The 8th U.S. Circuit Court of Appeals reversed a bankruptcy court and a district court and found that attorney Mark Allen Jesperson could not discharge more than $360,000 in student loan debt in a Chapter 7 proceeding. The two lower courts had found that repaying the "shockingly immense" debt would create an undue hardship for Jesperson. But the appeals court on Wednesday determined that his "self-imposed limitations," which resulted in a gross...

Almost every bankruptcy expert The Am Law Daily talks to agrees that the super-fast General Motors and Chrysler bankruptcies diverted from traditional bankruptcy law because of the government's huge role in each case and the danger liquidation might have posed to the broader economy. What they don't agree on is whether the cases set a meaningful precedent for future judges. "What happened in GM and Chrysler is so outrageous and so illegal that until March of this year, nobody even conceptualized it," says Lynn LoPucki, a bankruptcy expert at UCLA Law School. "Wouldn't almost every company like to get out...