As predicted, bankruptcies are ramping

08/10/2009 • Investment Watch

When people lost their job and carry around a lot of debt, they are likely to file for bankruptcy. Banks will face more losses during the next quarters. “Aug. 10 (Bloomberg) — Consumer bankruptcies show no sign of abating after rising more than a third this year and may hit 1.4 million by Dec. 31 as jobs are lost and loans are harder to get, according to the trade group American Bankruptcy Institute. More than 126,000 consumers filed for bankruptcy in the U.S. last month, 34 percent more than in July 2008, the ABI said in its latest report on Aug. 4. The increase came after a 36.5 percent rise in personal bankruptcies nationwide in the first six months, to 675,351, according to the ABI research group, which interprets data collected by the National Bankruptcy Research Center. “Rising unemployment on top of high pre-exiting debt burdens is a formula for higher bankruptcies through the end of this year,”