Our Changing Globe

Posts Tagged ‘bankruptcy’

In spite of the fact that many supposed financial experts are suggesting that the worst of the current economic crisis is already behind us there is little reason to believe that this is true and many reasons to believe that it isn’t.

We are without doubt in the grips of the worst financial crisis since the ‘Great Depression’ and in many ways the problems are more formidable because they are global and the U.S. banking and financial system has been left virtually insolvent by credit losses amounting to around $3 trillion.

Insolvency problems by their very nature limit the effectiveness of monetary stimulus packages and the risk of rising interest rates erodes the growth effects of fiscal stimulus packages so all the intended ‘policy remedies’ are likely to have only very limited effects.
So what needs to be done!

In my opinion, insolvent banks need to be shut down and the debt level of insolvent households will have be reduced and until that’s done we shouldn’t expect conditions to ease.

U.S. deficits are set to skyrocket over the next few years and perhaps the most worrying aspect of all this is that the countries that are presently supporting America’s deficits are the very ones that are its strategic rivals, such as Russia, China and a number of additional countries that are politically unstable!

New York, which not long ago was the financial capital of the world isn’t even the financial capital of the U.S. anymore and Washington now is!

To make things even worse, many the world’s emerging markets are now facing the threat of a ‘hard landing’ and if that happens there will be a kind of global “stag-deflation” which would mostly likely mean economic stagnation, recession and falling prices.

Meanwhile growing opportunities will exist for those that have money or secure jobs because they will be able to buy houses at fire sale prices and because banks need to lend money to exist they will have to lend it to riskier and riskier applicants.

Right now it’s difficult for even people with good credit ratings to get loans and whereas having real estate used to mean almost instant loan approval even that is now problematical because of collapsing house prices.

So what about people that have continually been in arrears, have defaulted on debts, have liens on them or have even filed for bankruptcy?

Well if they have a job they can still get loans although the lender might insist on having a part of the borrowers salary attached, meaning that the monthly payment will be automatically deducted from his or her salary. And the interest rate will be high but not normally one that will prevent someone who really needs money in a hurry from signing up.

Well if you’re unemployed and don’t have any collateral you might feel after reading the above that you have no chance of getting any kind of loan but that’s not true. It might be more difficult and it will be more expensive but it won’t be impossible by any stretch of the imagination.

Unemployment is soaring and will get worse and many people have lost their homes but the banks still need to lend money or they’ll go out of business which means that they’re now making riskier and riskier loans.

The bottom line is that people that are in urgent need of money can make use of what are known as high risk immediate personal loans which provide almost immediate money when it’s needed most and many people use them to consolidate other mounting debts.

There are many different loans available and many different banks making them and many of the banks are small and you won’t have even heard of them but there are available lists which are getting continually updated.

If you have collateral but believe that there’s a good chance that you’ll default on the loan then take out an unsecured loan even though it costs more.