2 of 2 people found the following review helpful:
Further Insight Into The Demography of Bankruptcy, 2007-04-22
In some ways, this is the authors' companion book to their excellent book, As We Forgive Our Debtors. The Fragile Middle Class is less academic than As We Forgive Our Debtors and focuses more on the people who fall into bankruptcy and less on the economics and supporting cast of players (creditors and legal system)that comprise the U.S. bankruptcy system. In this book, the authors could provide reasons for why some individuals find themselves at the mercy of the bankruptcy court. For the time-pressed, Chapter One, Americans in Crisis, aptly summarizes the contents of the book.
The book provides the reader with a comprehensive definition of what it means to be 'middle-class'. It also provides the key socio-economic reasons underlying bankruptcy. These are: income disturbances (which includes unemployment and under-employment), credit cards, illness, divorce and housing. One chapter each is devoted to these reasons. Throughout, the stated goal of the authors was to tell the reader what the portrait of the bankrupt can tell us about the rest of society.
The authors re-affirm the old refrain that economic insecurity has greatly increased in American society. Their work strongly indicates that by far the greatest culprit leading to bankruptcy is job loss, followed by divorce and/or illness. In many cases, as the authors demonstrate, more than one culprit may be at work in a particular bankruptcy.
Perhaps the most interesting thing I noted in reading the book was the juicy little tidbit on credit cards on page 128. While the authors readily admit that mere possession of a credit card will not lead to bankruptcy, they do insist that the level of such revolving debt (for which they define the tipping point toward bankruptcy as short-term debt exceeding one and a half times gross annual income) is critical, and take care to point out that the debts can keep on compounding (at twenty-four percent interest, compounded monthly) long after the cardholder has shredded his or her piece of plastic.
In sum, this book was a very readable introduction to bankruptcy among the middle class. The authors have once again cranked out another excellent study.
4 of 6 people found the following review helpful:
DROWNING IN DEBT, 2004-03-07
IN 2OO3, OVER 1.6 MILLION AMERICANS FILED FOR BANKRUPTCY. OVER 33% OF THE AMERICANS THAN OWN A HOME ARE ONE PAYCHECK AWAY FROM FORECLOSURE. Is it that hard to believe that America is fastly becoming a nation of debtors. Even more interesting, the government actually promotes it by slack regulations, unnaturally low interest rates, and a willingness to keep Americans spending. This book does a fantastic job in helping anyone understand just how bad it is, and just how blind we as Americans are to the situation. 4 STARS! - Mason Johnson, President, www.tomorrowsgold.com
14 of 15 people found the following review helpful:
Could Happen To You, Could Happen To Me, 2003-05-26
This is not a "sky is falling" or alarmist book. It's not a negative gloom-and-doom book. It does focus on an unwanted event we consider negative, and it does occur in millions of peoples' lives. Da Big "B." It could happen to you, it could happen to me. Authors Sullivan, Warren, and Westbrook have decades of experience in the industry and provide one of the most detailed and accurate pictures of the people and circumstances within it. In addition to statistics and research, tables, and graphs, the authors conducted detailed surveys of 2,452 people and provided case histories of folks that filed for bankruptcy in the 1990s. They come from all income and occupational levels, and from all geographical areas of the country. Just like you and me. It only takes a hiccup. Keep your eye out for the legislation that will be coming forward. Although it would be unpleasant, bankruptcy is not the end of the world, by any means. There are worse things that can happen in life.
The "Fragile Middle Class" has non-biased an informative information on....us. What is the reality behind the so-called middle class? While millions of individuals and families are members of this club, and we have a definition of what qualifies people as being part of it, what is the financial health of the American middle class today in 2003? Real income is still declining, even after the economic boom of the 1990s. (This was a pseudo economic boom). Personal debt is at record levels. If truthful accounting and honest financial disclosures are conducted, being middle class means living paycheck to paycheck, on the brink bankruptcy, due to even a minor financial hiccup: divorce, a staggering medical bill due to illness or accident, or loss of a job. The authors' introduce the new concept called "skidding," which is when a person changes jobs, which results in lower pay, and therefore less income coming in. And they discuss the record number of people who've recently gone bankrupt. This book is about those, who are most of us, that teeter on the edge.
First, debt is essential to living in our modern economy, and when used properly is good for us, and benefits the economy. We can't now, and have never been able to pay cash for our home, or a new or used car. When people invest in real estate or a business, they borrow capital. Having leverage is actually better. However, total Debt ratio is the largest it's ever been, combined with stagnant and declining wages. 2/3 of the American economy is dependent on consumer spending, completely dependent upon people spending their on money on--everything. One example, out of thousands, is the recent public "begging campaign" from politicians and high-profile business spin doctors in New York, imploring people to "come to New York and spend money," to revive the economy. When there is a slight dip in consumer confidence we hear about it from the media, because it's considered so vital to the U.S. economy.
This book uses historical as well as current notes, stats, and case studies, with the majority of the findings from the results from the decade of the 1990s. It is obvious that the tech-boom of the 90s was a temporary band aid that was applied to a long-term sociological and economic bullet wound. Financially, Americans are in some of the worse financial shape they've ever been in. Why is consumer debt at an all-time high? Why over one million bankruptcies per year? This book conducts research and analysis that paints the modern day picture from the perspective of people in the bankruptcy industry. And today, the bankruptcy numbers are so significant that the Federal government will soon pass legislation in an attempt to reduce the numbers of Americans filing. However the reduction in the number of filers means major changes need to be made by our societal and cultural expectations, financial institutions, and personal spending habits and behavior. Something that Congressional legislation can't do alone. There will be an impact, but it will be minimal. One could adopt my personal attitude, which is simply not to care.
2 of 22 people found the following review helpful:
A Rehash, 2003-02-05
Rehashes their earlier book and reiterates the same tautology: too much debt causes bankruptcy.
8 of 9 people found the following review helpful:
Owe my Soul, 2002-11-21
Excellent read if you wondering about the number of bankruptcies or have been puzzled about the decline in real wages over the last few decades. It may make you think twice about your own finances!