Bankruptcy filings continue to skyrocket
News networks across the country have given considerable attention to the unprecedented number of bankruptcy filings throughout the nation. Once sprawling communities like Orange County California have some of the largest numbers of bankruptcy filings per capita. The real estate market in this area as in many parts of the country has come to a complete stop. No new development is taking place and the local economic outlook in Southern California as a whole is not improving mostly due to the price per gallon of gasoline, which is one of the highest in the country.
Souther California is one of the hardest hit regions in the country for personal bankruptcy filings, this is highly credited to the over valuation of real estate property during 2001 through 2005 and the sub-prime loans that funded the majority of these properties. The number of people filing for personal bankruptcy, compared to last year are up 90% for LA county, 125% for Riverside county and a staggering 150% for Orange County.
The state of Colorado has seen a rise of 35% since last year, and again it is home owners with high interest mortgage loans that make up over 60% of the bankruptcy cases.
Things are due to get worse according to economic experts, who predict no relief will be seen until two to three years from now. Because gas prices are gradually increasing each day, the cost of commodities and other consumer products have kept up with the price, adding further strain on the already heavily burdened communities of consumers across the country.
Overall the entire country is currently seeing a rise of 50% since last year. It is expected that by the end of 2008, we will see a total number of over one million personal bankruptcy cases which will continue throughout 2009.
Our economy is susceptible to many different factors, including external factors like the overall world economy. A contributor to the price of oil is none other than China. The country has emerged economically demanding more gas, food and quality of life. The once low waged workers are currently climbing the ladders economically and this new demand is now plugged to the main line of distribution for commodities like oil, wheat, and sugar.
It doesn’t matter how much money exists in any one region, it is the demand for these goods that drives up inflation.
So the economic state of the US, which is already affected by the real estate melt down, can expect to see higher prices for commodities and further escapes from debts through bankruptcy filings. Again no solid plan is in place to overcome this, any plan brought forth by the political parties are nothing more than pandering attempts.
Save what you can and invest in hard assets, paper assets will be worthless soon.
