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Record 26,000 Persons Went Bankrupt Apr - June 2006

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Looks like the MEW fad is coming back to bite...


Insolvencies show sharp increase

A record 26,000 people became insolvent in England and Wales during the second quarter of 2006 - 66% more than in the same period last year.

Analysts KPMG have predicted the number of personal insolvencies this year will exceed 100,000, almost a threefold increase on the 2003 figure.

Experts have blamed greater personal debt for the rise in insolvencies.

This week, all the major banks increased their provisions to cover debts that will not be repaid.

Nearly two-thirds of people declared themselves bankrupt.

The remaining people took out Individual Voluntary Arrangements (IVAs) - an alternative to bankruptcy that allows debtors to come to an agreement with their creditors.

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Its just the beginning of the end of the Miracle Economy which has been based on HPI-MEW.

As Merv said, house prices are just opinion whereas debt is real. Welcome to reality I would say. (Hideous freakish laughter echoing to fade)

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Where I used to live for awhile, San Diego, is mirroring the UK market as it did during the Great Crash:


San Diego mortgage defaults double
Mortgage default notices in San Diego County nearly doubled this spring to the highest figure in the past seven years, according to a report released yesterday.
Analysts read the new statistics as further evidence of a real estate market slowdown and blame the increase partly on home purchases made in the past several years that required little or no down payment and which carried below-market adjustable interest rates that are now rising.

San Diego began to crumble in 1989 and only recovered in 1996 with drops of about 30% on average. Here we all go again.... :o

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LONDON (AFX) - Individual insolvencies in England and Wales soared to a record high in the second quarter of 2006, eclipsing the previous all-time high in the first three months of the year, official figures showed.
The figures, which reveal the mounting debt burden carried by Britons, are likely to climb further in the third quarter after the Bank of England hiked interest rates for the first time in two years yesterday.
Accounting firm PricewaterhouseCoopers reckons the number of individual bankruptcies will swell to over 60,000 by the end of the year while individual voluntary agreements are seen rising to 50,000
The steep rise will also have repercussions for the financial sector.
"This means that bad debt write-offs could amount to up to 1.5 bln for creditors," said Pat Boyden, partner in the Business Recovery Services practice at PricewaterhouseCoopers.

The unwinding may happen a little faster than even the most conservative Bear would have thought? The effect on consumer confidence will be profound. Just goes to show that spending without producing never works for long and that there is no such thing as a "Miracle Economy."

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I think this is called a rising trend - it really is only going one way. People who ignore this early warning sign for our economy and society are naive IMO.

we so heard all this 2 years ago.

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  • 334 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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