Today’s Ebook – Causes and Effects of the Lehman Brothers Bankruptcy

Chris McClelland | RSS | Tue, Nov 17 2009 | 0 Comments

Today’s featured ebook download is Causes and Effects of the Lehman Brothers Bankruptcy (123 KB, 26 pg) – I argue that the demise of Lehman Brothers is the result of its very aggressive leverage policy in the context of a major financial crisis. The roots of this crisis have to be found in bad regulation, lack of transparency, and market complacency brought about
by several years of positive returns. Lehman’s bankruptcy lead to a reassessment of the risk, in particular in the market for credit default swaps.

What you can learn from this ebook

The demise of Lehman Brothers can only be understood within the context of the current financial crisis, the biggest financial crisis since the Great Depression. The roots of this crisis have to be found in bad regulation, lack of transparency, and market complacency brought about by several years of positive returns. I will start by explaining these three roots and then I will discuss how Lehman contributed to its own demise and what the consequences of its filing for bankruptcy are.

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To download this ebook, or any of our current ebooks, please visit the ebook page where you may choose the ebook(s) you wish to download. *Download an ebook by clicking on it’s title.*

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Tags: leverage, credit default swaps, ebooks

Your credit score and job prospects…why it matters

Jennifer McClelland | RSS | Wed, Jun 10 2009 | 2 Comments

Credit makes the world go around, at least in our capitalistic country. It seems these days there isn’t much that you can do without it; including landing a job.

It might sound crazy to you, because it definitely sounds crazy to me, but when you apply for a job and agree to a background check, the potential employer can also check your credit history. To me, this is not any potential employer’s business. What credit follies I may have made in the past I am obviously trying to rectify by getting a job and it will be very difficult for me to fix anything without a job.

Thanks to a steadily declining job market, credit scores are on the decline. People are getting behind on credit card payments, going into foreclosure, and filing for bankruptcy protection. So finding a job with a bad credit score is a double edged sword.

According to those who are for the credit score check prior to hiring an employee money problems could mean that the person has a disorder in their life that could lead to poor work habits, including employee theft. These same people said that those with great credit histories are less likely to have poor work habits and be trustworthy as well as reliable.

I, as well as some experts, think there is no clear link between a credit score and history and the job that an individual can do. I am not saying that there is something wrong with having a pristine credit history, just that you can’t count out those who don’t. Credit reports simply don’t account for layoffs, the overall economic conditions regarding unemployment, and things like medical bills or identity theft.

There is someone I know who is the best person with money. He actually is the biggest saver I’ve ever met. Unfortunately, through a couple of bad business deals and poor judgments of character, this man’s credit fell to a very low number. These kinds of things stay on your credit report for seven years for the most part. Think about it, if you can start your credit history when you’re 18, do you think you’re the same person at 25? How about the difference between 23 and 30?

I think that if an employer is going to check an applicant’s credit history, perhaps he or she should give the applicant the chance to explain blemishes on their credit report rather than just judging that applicant for things that may be nearly a decade old. Even though I would still not agree with the practice, I think that this would at least give the applicant a chance to explain the situation instead of just being thought of as a “bad prospect” to a potential employer.

Related posts:
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Tags: employee theft, credit card payments, filing for bankruptcy

Goodbye Circuit City

Jennifer McClelland | RSS | Sun, Mar 08 2009 | 2 Comments

Today was Circuit City’s last day in business. The Richmond, Virginia based electronics chain closed the remaining 567 stores today leaving 18 million square feet of empty retail space in its wake.

Circuit City filed for Chapter 11 bankruptcy protection in November with hopes of emerging as a stronger company able to compete in the ever-expanding marketplace; shedding its $2.32 billion in debt and getting out of older real estate.

Unable to work out a sale or secure new financing, the company will instead spend its remaining days tallying money from the sale of its assets, breaking or assigning its leases and paying off its growing list of creditors.

Circuit City owes nearly $625 million to its 30 largest unsecured creditors — mostly vendors who supplied the DVDs, flat-screen TVs and headphones on Circuit City shelves. They must wait to be paid until secured creditors such as bank lenders are satisfied.

This is an example of a company that did not survive a Chapter 11 filing. In my last post, I wrote about how a couple of Republicans are speaking out about GM filing for bankruptcy. If the same thing were to happen to GM…there would be hundreds of thousands of jobs lost. You also have to take into account the supply chain that automobiles create, another few hundred thousand jobs would be cut if GM had to liquidate.

Source

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Tags: chapter 11 bankruptcy, banks, filing for bankruptcy