Many of today’s high school students are led to believe that, should they wish to be competitive in the job market, a bachelor’s degree, and often a post-graduate degree to boot, is necessary. Flocking to universities across the nation, America’s youth are betting against their uncertain futures and burying themselves under mountains of debt. Too often, these students find themselves overwhelmed after they have graduated and the bill collectors come knocking. [More]

Approximately five years after the United States economy took a nosedive, analysts have started to note possible signs of an economic turnaround. Unemployment claims are at their lowest level since 2008. U.S. GDP is in its tenth consecutive growth quarter. American retail spending is increasing. Additionally, President Obama stated his confidence in continuing economic growth. However, where does the fact that 2011 business and consumer bankruptcy filings were down (as compared to 2010) fall? Whether it is another encouraging signal that the bad economy is on its way out or simply has no correlation, bankruptcy filings this past year have fallen across the board. [More]

The current financial crisis ushered in by the collapse of the sub-prime mortgage market has shaken the foundations of our financial markets, exposed numerous Ponzi schemes, most infamously that of Bernard Madoff, and resulted in a tremendous increase in home foreclosures and bankruptcies. In many of the current bankruptcy cases the line between a fraudulent conveyance and a legitimate transfer can make a difference of millions of dollars for the legitimate creditors. In the realm of real estate, this situation has placed on the courts the burden of deciding which is more important: fair and equitable distribution of assets among creditors, or the historical distinctions between fraudulent conveyance law and foreclosure law. [More]

New regulation will come out of the 2008/9 crisis as is common after every major crisis (e.g. 1930’s meltdown and Enron’s falling, among others). What is most important is that such regulation should aim at terminating certain undesired market incentives: those which contributed to the development of the 2008/9 crisis, and the negative ones arising from the bailouts.

Along the path of reform, it is essential to understand that systemic risk, the 2008/9 systemic crisis and the bailouts are three different situations, with different causes and effects. Thus, they can be addressed separately to improve the overall situation, without need to exclusively seek for a unique “magic” solution.

Fine tuning over traditional financial regulation as well as exploring new ideas –such as limiting the size of Too Big To Fail Companies – will be required.


Along the path of reform, it is essential to understand that systemic risk, the 2008/9 systemic crisis and the bailouts are three different situations, with different causes and effects. Thus, they can be addressed separately to improve the overall situation, without need to exclusively seek for a unique “magic” solution. [More]

In the struggling economic climate, many corporations have sought bankruptcy relief. Numerous financial institutions such as the automobile industry and electronic corporations have become accustomed to seeking such restructuring aid and most recently, even the sports world is no longer immune. In October 2009, the Chicago Cubs organization became yet another victim in this economic downturn as the Tribune Company filed Chapter 11 bankruptcy for the baseball team. Although many companies have sought relief due to monetary struggles, “‘You don’t have to be insolvent to be in bankruptcy [. . .] All you need is a legitimate business reason.’” [1] The Chicago Cubs seek reprieve as a way to sell the organization in a tight credit market to an eager buyer, not willing to take on the debt of the parent corporation to its creditors. Through the sale of the Chicago Cubs, the organization can look forward to new ownership, ward off all creditors to the parent corporation, and possibly one day shed their “lovable loser” status. [2] [More]

The auto industry’s troubles have recently come to light in mainstream American news. The big three automakers, comprised of GM, Chrysler and Ford, have seen slumping sales and are in need of major financial help to avoid going under. In 2008, GM’s sales were down 21% in North America. Ford reported a loss of $14.6 billion dollars in the same year. Chrysler’s sales were down 30% in 2008, which was the largest reported loss of the major auto makers last year. Both GM and Chrysler have requested help in the form of federal loans from the US government, while Ford has made an effort to stay afloat without federal help. [More]

I. Introduction

On July 25, 2008 the Federal Communications Commission (“FCC”) approved the XM Satellite Radio and Sirius Satellite Radio merger voting 3-2 to approve the deal without imposing many restrictions on the combined entity.[1] Critics of the merger asserted that the combination of two principal satellite radio companies would result in a monopoly.[2] The FCC recognized that the Internet age has revolutionized how individuals obtain and listen to music opening the market to a variety of competition.[3] However, the question remains whether the Sirius XM Radio merger will survive. On July 25, 2009, the day of the announcement of the merger, Sirius shares plunged 43% and XM stock declined 40%. Recently, reports indicate that Sirius XM Radio is preparing to file bankruptcy.[4] This article will analyze the state of Sirius XM Radio as well as give recommendations to Sirius XM radio on increasing revenue. [More]

I. Introduction

On February 19th, 2008 the specialty retailer Sharper Image filed for bankruptcy under Chapter 11 and announced that it would no longer be accepting its gift cards. This came as a shock to consumers, who suddenly found their holiday gift cards worthless. "'That is typical of businesses that reorganize under Chapter 11 bankruptcy, which treats gift cards as a loan to the company, not as cash.'" [1] Chapter 11 allows for an automatic stay of recovery for any claim against the debtor that arose before the filing of the bankruptcy claim. [2] In response to this announcement, C. Britt Beemer, chairman of America's Research Group, projected that this would greatly affect Sharper Image's future. "'You will see a lot of frustration among customers. You basically stole [money] out of the customers' pocket. They will never forgive you.'" [3]

Just two and a half weeks later, on March 7, 2008, Sharper Image announced it would resume its gift card program, but with certain conditions. Sharper Image's website explains that the program is purely voluntary, applying to all gift cards issued prior to its filing Chapter 11. [4] A person choosing to redeem his gift card must spend the entire balance of the card and the purchase total must be at least twice the amount on the gift card. [5] For example, if a person has a $100 gift card the total purchase must be at least $200, using the full balance of the card. If a person chooses not to redeem according to the new policy, he may have a claim in the bankruptcy action, which would be classified as a priority unsecured claim. [6] This is high up in the unsecured food chain, but would not be paid until all secured claims, those backed by assets, were paid out. Sharper Image Chief Executive Robert Conway explained, "'while not a complete solution, it does provide satisfaction to customers on a voluntary basis.'" [7] The website goes on to say that Sharper Image hopes it can honor gift cards without condition in the future, but it cannot be guaranteed. [8] Most Sharper Image retail stores are accepting gift cards, but the website can no longer honor them. [More]

Introduction:

Michael Nifong, the former North Carolina prosecutor made controversially famous for his rape accusations against several lacrosse players from the University of Duke, has filed for bankruptcy. [1] After resigning and being disbarred, the former D.A. filed for a Chapter 7 bankruptcy, listing liabilities in excess of 180 million dollars. [2] [More]

Introduction

As tuition rates climb to an all time high, it is not unusual to hear of students leaving college with 40, 50, or even 60 thousand dollars of debt. Many law and medical students are graduating from school with a degree in one hand and 100 thousand dollars in student loans in the other. This continuing increase in tuition has many eager students pursuing community colleges over four year universities. [1] For example, Mott Community College's Michael Kelly states that enrollement has been up 28 percent in the last five years. [2] Kelly says that for some the choice is simple and "[t]he higher the cost is, the more students we get." [3] [More]