The community here in Modesto continues to feel the economic woes the nation is feeling. Although the country would like to think the economy is getting better, there is a growing rate of bankruptcy filings among businesses throughout the country, including Modesto. The Reuters news service reported that business bankruptcy filings were 7 percent higher in January, 2010, then in January, 2008. With so many business bankruptcy filings it is apparent the economic slump will continue into 2011. That means more bankruptcy filings in Modesto as any lawyer will tell you.
The Reason: As long as consumers are hurting, businesses will continue to hurt as well. The national unemployment rate hit 10 percent in December, 2009, and then fell to 9.7 percent in January. These numbers are probably higher in actuality given the fact that many people have given up searching for work. The national unemployment rate takes into consideration those that are actively searching for work and as we all know, many have given up entirely. Even those that have work are worried about losing their jobs, so as a result, people aren't spending like they used to. This has certainly led to many bankruptcy filings here in Modesto.
Foreclosures Enhance the Problem: Foreclosures continue as housing values plummet. According to RealtyTrac.com, there were 2.8 million foreclosures in 2009, making 2009 a record high for foreclosures. When people are unable to pay their mortgage, they stop spending on other goods that businesses thrive on, thereby increasing bankruptcy filings in Modesto and the rest of the country.
What should we do? Sadly, it doesn't look like bankruptcy filings will be decreasing anytime soon. Bankruptcy attorneys in Modesto are busier than they have ever been. The good news is that the United States has been through this many times before. The economy has cycled up and down through the years. That will certainly happen at some point in the future. People will once again increase their budgets as the housing market will soar to new heights all over again. Prosperity will soar throughout the country all over again. People will naively believe the markets are indestructible. Then, the economy will once again tank and we will be right back to where we started. Bankruptcy will soar throughout Modesto and the rest of the country. Bankruptcy lawyers will be working overtime, especially here in Modesto and the rest of the Central Valley.
We'd all like to think that the nation's economy is improving, but the rising number of business bankruptcy filings offers proof that commercial businesses throughout the country are still hurting. According to a recent story from the Reuters news service, business bankruptcy filings in the United States this January came in 7 percent higher than in the same month in 2008. An astounding total of 6,502 U.S. businesses filed for bankruptcy protection in January. At this rate, the economic slump will continue throughout the year and into 2011. That's the type of bad news that no one wants to hear.