Was Declaring Bankruptcy A Smart Decision?

Was Declaring Bankruptcy A Smart Decision?:
Nadya Suleman has made no secret of her financial troubles, which came to a head this week when the “Octomom” filed for bankruptcy. The mother of 14 owes creditors nearly $1 million, court papers showed, roughly 20 times as much as the value of her assets. ”It is pretty extreme in terms of how much debt she has,” says Richard Hipp, manager of bankruptcy operations at non-profit credit counselling organization In Charge Debt Solutions. The bankruptcy might give Suleman a fresh start, but the filing means that her creditors — which include a Christian school and her own father — are out of luck.

Suleman filed for Chapter 7 bankruptcy, in which a debtor’s assets are liquidated and nearly all unsecured debt is discharged. This might seem like a more drastic option than Chapter 13, which lets filers hang onto some assets — such as a house or a car — if they agree to enter a repayment plan. Before filing, a person considering bankruptcy has to meet with an attorney and go through a means test, which helps determine which type of bankruptcy is most appropriate for them. The test compares the person’s monthly expenses and income to see how much is left over that could be used to pay off debt.

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Houston Family Gets Locked Inside Restaurant For Leaving Bad Tip

Houston Family Gets Locked Inside Restaurant For Leaving Bad Tip:
Houston resident Jasmine Marks learned a valuable tip on restaurant gratuity while eating out with her family last week.

According to NCB affiliate KPRC Local 2, Marks and her family were locked inside La Fisherman restaurant after they refused to pay the 17 percent tip that was automatically added to their bill.

The reason, Marks told the news station, was because the service was slow, she and her party did not get everything they paid for and the staff was rude. The restaurant claims, however, that the mandatory gratuity is customary for parties of five or more, like Marks'. It's a rule that they've even printed on the bottom of every menu, KPRC reports.

"We asked her, could the gratuity be removed? Could we give our own tip?" Marks said. The response she got was to speak with a restaurant manager, but when that didn't work, a staffer called the police to intervene.

"I asked the police officer twice, maybe three times, is it against the law if we don't pay the gratuity and he never gave me a straight answer," Marks went on to say. The family conceded to paying the 17 percent tip in an effort to avoid further trouble.

In a study published last month in the Journal of Black Studies, 40 percent of waiters admit they discriminate against black customers because of a perception they don't tip as much as white patrons.

The survey found that blacks were typically described as “picky,” “demanding,” and “rude,” according to the Washington Examiner.

Dan Parson, president of Houston's Better Business Bureau, who received a complaint about Marks' experience, told KPRC that consumers need to understand the restaurant's policy before they even sit down.

"I mean every sign walking in the door. What credit cards do you accept, not accept? What are your hours? Seventeen percent gratuity for the six of you? If you don't like it, go," he said.

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Geithner Op-Ed: 'What the world must do to boost growth'

U.S. Department of the Treasury
Subject: Geithner Op-Ed: 'What the world must do to boost growth'

Geithner Op-Ed: 'What the world must do to boost growth'

What the world must do to boost growth

By Tim Geithner

 

The world economy is in the midst of the second slowdown of this recovery from the financial crisis of 2008 and 2009. The question is not whether we have the economic or financial capacity to act to strengthen growth, but whether we have the political ability to do the right things.

 

The shocks behind the slowdown – oil prices, Japan's disaster, the crisis in Europe – are severe enough to have been dangerous even if they had happened during a global boom. They are more dangerous now because they hit a world still healing from financial crisis and because of the general fear that political constraints will prevent governments and central banks from acting sensibly with the tools available.

 

With interest rates very low in the major economies, budget deficits swollen by the crisis, and the financial imbalances of the crisis only partly resolved, there are limits on what policy can do to help strengthen growth.

 

But the biggest constraints on action in the major developed economies now have less to do with those economic realities and more to do with political paralysis, misplaced fears about inflation and moral hazard, and unwarranted disaffection with the efficacy of the traditional fiscal tools of tax cuts and investment to encourage growth.

 

The three most important things that have to happen for the world economy to regain momentum are these. First, the U.S. should act to strengthen growth and employment. President Barack Obama will push for the very substantial package of public investments, tax incentives, and targeted jobs measures he will put forward tonight, combined with a carefully balanced mix of fiscal reforms designed to restore fiscal sustainability over the medium term.

 

Second, Europe needs to take more forceful action to generate confidence that it can and will resolve its crisis. This requires governments working together and alongside the European Central Bank in an unequivocal commitment to support Europe's financial system and ensure governments can borrow at sustainable interest rates as they reform. Finally, China and other emerging economies need to continue to strengthen domestic demand and allow their exchange rates to adjust to market forces.

 

In early 2009, the world showed remarkable unity and deployed remarkable financial force in rescuing the global economy. The challenges now are different and cannot realistically be confronted by a repeat of that coordinated global response of financial stabilisation and fiscal and monetary stimulus.

 

But the imperative remains to strengthen economic growth. Fiscal policy everywhere has to be guided by the imperatives of growth. Where deficits and interest rates are too high, governments have no choice but to consolidate. Where fiscal positions are stronger and interest rates low, some countries have room to take more action to support growth, and others can at least slow the pace of consolidation. Where more fiscal reforms are necessary to achieve long-run sustainability, the emphasis should be on policy changes that take effect over the medium term.

 

As for monetary policy, with growth slower and oil prices lower, inflation risks are on average, though not everywhere, less acute. This means some central banks will continue to ease policy, while some will keep rates lower longer and slow the pace of expected tightening. None of the major central banks are out of ammunition. The repair and restructuring of financial systems has to be accelerated where it has lagged. Countries that forced more capital into their banking systems early in the crisis are better placed to support the recovery. Those that did not should move more forcefully now.

 

Financial reforms designed to prevent the next crisis need to be designed and implemented in a way that does not exacerbate the slowdown. We need more progress in rebalancing global demand, with broader and faster appreciation of the remnimbi and the other policies necessary to strengthen domestic consumption in China and other emerging economies with large external surpluses.

 

The outlook is not all dark. Oil prices have eased somewhat, relieving pressures on consumers and businesses. Growth in emerging markets remains quite strong. Most private forecasters expect U.S. growth to be stronger in the quarters ahead than during the first half of this year. The IMF expects the world economy as a whole to continue to expand at a moderate pace.

 

But the risks of a longer period of relatively weak growth are significant, and it makes sense for policy makers to act to reduce the risk of that outcome. One of the most important lessons from the history of financial crises is that the political will to act to secure recovery fades too quickly in the face of the political costs of the initial response and early optimism about growth. This was a terrible crisis. Recovery was always going to be slow, fragile, and take time. We have more work to do. We are better off doing it together.

 

The writer is US Treasury Secretary​

U.S. Department of the Treasury · 1500 Pennsylvania Ave, NW, Washington, D.C. 20220 · (202) 622-2000

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