California Bankruptcies Up and Down Halfway Through 2011
One way to check the health of the American economy is to take a look at all the people in trouble. You can look at housing starts, foreclosure data, and bankruptcy data. Although bankruptcy data tells you who’s lost (thus those who are already doing really bad and no about to), it’s still an indicator whether or not the economy is picking up. If we pick the largest state in the US we can get a general feel for the broader economy.
The results? There’s good news for bankruptcy lawyers, there’s still plenty of work to be had. The bad news which is also laced with good news, bankruptcy numbers are still very high, but some filings show signs of slowing down.
The following stats and graphs were compiled by San Diego Bankruptcy Attorney CC Legal.
Chapter 13 bankruptcies, where debtors by an large can keep some assets like their homes, were up across the state. It is essentially a form of debt consolidation where the court supervised repayment attempts to prevent a foreclosure in hopes the debtor can repay debts. Unfortunately Chapter 13 claims remain on credit reports for 10 years rather than 5 like Chapter 7.
California saw some cities decline in Chapter 7 filings, but the average claim was higher than the previous quarter, and in fact another all-time high in the state of California.
Chapter 7 on the other hand witnesses a decline quarter over quarter. This is the first time a decline in quarter to quarter bankruptcy claims has been observed in almost 5 years.
With a double dip recession here in September, the question is whether this data will continue to decline/slow or whether California will experience another downturn. We’d see evidence of the effects of a double dip recession in the beginning of 2012 (although the results prior would be indicative of tough economic times.)
It’s pretty clear, not much has changed, and although some numbers are down suggesting more people are staying afloat in tough economic times, the number of bankruptcy filings are still around record setting numbers. THat’s good news in a way for bankruptcy lawyers, and bad news for everyone else.
Data from RAND California.
Why is it that California, which has so many natural advantages, seems to be struggling so much economically. It seems like the state’s government has been dysfunctional for many years now.
Blindfolded Monkey
4 Oct 11 at 8:23 pm
I would hazard a guess is they don’t necessarily use their wealth in the most efficient way possible. That and they are still subject to the problems the rest of AMerica faces, unemployment and housing issues. Plus they also have the most people….
admin
5 Oct 11 at 9:56 am