2012 Economic Numbers Show Bankruptcy Filing Is Close for Many


Now that Christmas is past and New Year's day is just right around the corner we can take a look back at 2012 and hopefully give us an idea of what's up for the economy in 2013. 2012 had a crazy year with the presidential election that had an outcome that nobody expected and a whirlwind of economic data that showed no improvement for the US economy. According to the numbers, many Americans should be filing bankruptcy but instead are just going further in debt. The mainstream media keeps talking about the great job the president has done and how the Federal Reserve continues to get the economy back on track. The truth is, people have already forgotten about the president's involvement in "fast and furious". Let's not forget about the Benghazi scandal, the takeover of Libya, while working towards putting troops into Syria. It's been a busy year and the media is still only talking about the president's Hawaiian vacation to what the movie stars are wearing. They should be discussing the possible impact to the American economy with the printing of billions of dollars with QE3 in September and since that wasn't enough QE4 in December. It seems that no one cares about what printing $85 billion a month and pushing it into the economy through quantitative easing will do to Main Street. The Weimar Republic is a perfect example of what happens when this kind of economic policy is used.

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Congress, the Fed and the President believe the economy just needs to be tweaked a little bit and it will fix our economy. The reality is most Americans are on the verge of a bankruptcy filing and if it wasn't for having a credit card with an available balance on it, they would be filing bankruptcy today. At the end of the year should be the time to reminisce with family and friends about the past. Hopefully people can learn from their mistakes and change their direction when things aren't going right. Recently it was reported that the bankruptcy filing numbers have declined to 1.3 million and the press used this to let Americans know that the disastrous economy is over. What's interesting is the number of Americans filing for bankruptcy is declining as their debt ratios are increasing. What most people don't notice is banks are once again creating a consumer debt bubble greater than the one in 2007. The consumer debt in the US just surpassed $2.75 trillion last month and I didn't see anything about that on the news. It's pretty obvious to me that the banks have increased their lending to consumers and this is why people can avoid filing bankruptcy and continue to kick the can down the road.

If someone wants to know the ugly truth about 2012 here are a few facts.

In 2008, 31 million Americans were receiving food stamps and just four years later that number has increased to 47.7 million people. That is a 50% increase and doesn't seem to me like things are getting better.
Next, it was reported in a recent study that 55% of all Americans have received some kind of money from the federal government.
For those that are prepared to be shocked, the sad truth is more than 1 million public school students are now homeless, a 57% increase since 2007.
Now that the numbers are in for 2012 the median household income has declined by $4000 in the last four years. What happened to that recovery the media has been talking about?
One fact that baffles me is in September 2009 at the peak of the recession it was reported that 58.7% of Americans were employed. At the end of November 2012, 3 years later, it surprised me to learn that only 58.7% of Americans were employed. What happened to the unemployment numbers they've been reporting showing things getting much better.
In 2000, the US manufacturing plants employed more than 17 million Americans. Since manufacturing has been moved overseas, that number is now less than 12 million employed.
And for anyone that says things are getting better, the US share of global GDP has dropped from 31.8% in 2001 to 21.6% in 2011. That number is probably much lower that isn't available for 2012 as of yet.

As Americans continue to try and be optimistic they really need to face the ugly truth about their personal financial situation. For those that are getting further in debt they should consider consulting a bankruptcy attorney to see if filing for bankruptcy should be in their future. It doesn't seem that it's wise to continue living paycheck to paycheck when bankruptcy filing is available. A bankruptcy attorney will at least enlighten a person on the path they are choosing and hopefully help them avoid making fatal financial mistakes.


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