Unemployment, Business Failures, and the Credit Crunch: A Worldwide Epidemic

Submitted by Jen Jones on Mon, 05/18/2009 - 11:46am

Unemployment, Business Failures, and the Credit Crunch: A Worldwide Epidemic

Every day, we hear more about the effects of the faltering U.S. economy: companies are collapsing at alarming rates; unemployment is soaring; corporate and personal bankruptcies abound; home prices keep tumbling; and new credit is harder to find and more expensive to borrow. State and local governments are raising property and sales taxes to save themselves from going belly-up too, putting even more strain on the budgets of people already struggling to make ends meet. As disturbing as it is to watch our economy come apart at the seams, the underlying problems run so deep that the rippling effects have led to a worldwide financial epidemic. The Asian markets are a prime example. Japan some 6,000 miles off the east coast of the U.S. is dealing with its worst economic fallout in decades. Corporate bankruptcies have been on the rise for the last 11 months in a row, up 9.4 percent from a year ago. Sixteen publicly traded companies have folded this year already, and 33 shut down last year a record. The corporate collapses last month alone left more than 11,000 people without a job. Pioneer Corporation -- the former electronics powerhouse with its headquarters in Tokyo is teetering on a dangerous precipice itself: it forecasts a loss for the sixth year in a row and plans to cut 9,800 jobs this year. As a result of this fallout, Japan has seen its fastest increase in the unemployment in 40 years. Like the U.S., the government has responded with massive infusions of cash into the private industry. Nonetheless, more companies are expected to fold and more people are expected to lose their jobs -- prolonging and deepening the recession. The picture in China doesn't look much brighter. The number of consumer bankruptcies there shot up 56 percent from a year ago this April: 1,490 people filed bankruptcy last month, compared to 957 last April. And, 1,872 people filed in March of this year, a six-year high. South Korea is feeling the pressure too: its corporate bankruptcy rate hit a three-year high in the fourth quarter of last year. There are also signs of trouble just across the Atlantic from us. In England, personal bankruptcy filings are up seven percent and corporate bankruptcies are up 13 percent. The point is, the economic downturn we are experiencing in the U.S. runs very deep. It has not just created significant problems at home; it has contributed to -- if not directly caused -- similar problems abroad. And, the downturn in the effected countries will surely to slow the pace of our own recovery. The bankruptcy laws here and abroad were designed to help people in these kinds of times; hence, the rise in filings around the globe. If you're caught up in this crisis and struggling with unaffordable debts, call a bankruptcy attorney today and learn how you can regain control of your financial life, even in these troubled times. In North Carolina, contact The Law Offices of John T. Orcutt, with convenient office locations in Raleigh, Durham, Fayetteville, and Wilson.

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