Corporate Defaults In Emerging Markets Hit Six-Year High


The worldwide economic slowdown has begun to take a toll in yet another arena of worldwide finance: the default rate of corporate debt in emerging markets. Companies from emerging markets are defaulting on their debt at a rate of 3.8% — the highest level since 2009. Through November 2015, that represents an increase of 40% over 2014. For reference, U.S. companies defaulted at a rate of 2.5% over the same time period.

There has been a complete reversal from just four years ago, when U.S. companies were defaulting on loans at a 2.1% rate while the emerging market default rate was down to 0.7%. The U.S. was just embarking on a relatively slow recovery while emerging market economies were growing at close to 7%, buoyed by tremendous growth in China. Stimulus efforts in the U.S. and other developed nations kept interest rates extremely low, driving more bond investments toward corporate bonds of emerging markets in search of higher returns.

As a result, emerging marke…

Biggest Personal Bankruptcies


Rapper 50 Cent is currently going through the unpleasant experience of personal bankruptcy. That’s right, the man named after money, the man who sang, “Have a baby by me baby be a millionaire,” is now in bankruptcy court. Like many before him in the entertainment industry, overspending and lifestyle issues put 50 Cent (real name: Curtis Jackson) too far in debt. The last straw was a $7-million judgment against 50 Cent for posting a sex tape on the Internet without the subject’s permission.

According to court documents, “Fiddy” has total assets of $24.8 million and $32.5 million in liabilities, for a $7.7 million dollar shortfall. While being more than $7 million in the hole sounds bad, it is nowhere near the largest deficit accrued.

One of the greatest discharges of debt ever took place in Ireland recently. Seán Quinn, the Irish tycoon and owner of the Quinn group, at one point had a net worth of $6 billion and was 164th in Forbes’ world ranking of billionaires….

1 of 6 NFL Stars Goes Bankrupt


How do you go from being on top of the world with a multimillion-dollar contract to filing for bankruptcy? By spending like it is never going to end. Former football superstars are finding that out the hard way.

Studies have shown that a high percentage of NFL players declare bankruptcy after their playing days, and many others suffer financial difficulties. A Sports Illustrated (SI) article from 2009 indicated that after two years of retirement, a whopping 78% of former NFL players went bankrupt or suffered financial stress due to joblessness or divorce — although in fairness, that analysis falls into the heart of the Great Recession.

A recently released study by the National Bureau of Economic Research (NBER) focused on the bankruptcy aspect. The NBER working paper studied NFL players who had been drafted between 1996 and 2003. The authors found that bankruptcy filings…

Trump and Bankruptcy


Unless you have been in an isolation tank for some time, you know that Donald Trump is running for President of the United States. He of the iconic hair is particularly sensitive to discussions about bankruptcy, as his operations have declared bankruptcy multiple times. While the Donald may not like it, it’s fair to ask how a man who wants to be President can tout his business acumen and ability to straighten out the country while having filed for bankruptcy not once or twice, but several times.

Here’s why the question annoys the Donald: Donald Trump has never filed for personal bankruptcy. However, his operations have filed for Chapter 11 bankruptcy four times between 1991 and 2009. There is a distinct difference.

As opposed to the Chapter 7 liquidation bankruptcies generally used by individuals, Chapter 11 bankruptcy allows large corporations to stay in business while reorganizi…

Female Sports Stars That Went Broke


The massive salaries and endorsements of sports stars do not guarantee a comfortable life — evidence suggests the opposite is true for many pro athletes. Sports Illustrated estimated that a staggering 80% of retired NFL players end up broke within the first three years after retirement. Fortune magazine cites research from the National Bureau of Economic Research (NBER) showing that 15.7% of retired NFL players declare bankruptcy within twelve years of retirement, which seems a bit more reasonable.

Even so, that’s a lot of athletes burning through a lot of money and doing it for a wide variety of reasons. Financial difficulties all go back to bad decisions, and those bad decisions are not limited to the men’s professional sports, either. A few of the greatest female sports stars have also suffered bankruptcy-inducing losses, including the ones listed below.

Celebrity Bankruptcies


Celebrities and money management don’t always go together well. From the entertainment field to athletes to reality TV stars, celebrities arrive at their wealth and fame armed with a spectrum of spending habits and financial skills. Some inherently know how to handle their finances, and others hire trusted people to manage their funds for them. Those who don’t — and those who are hit with lawsuits and other circumstances because of their celebrity status — can end up losing it all and heading to bankruptcy court.

Here are a few celebrities who have been forced to file for bankruptcy over the years. Some are fairly predictable; others are surprising.

  • Nicolas Cage – The highly bankable star (pictured above) makes around $40 million a year, yet still managed to rack up enough debt to declare bankruptcy.
  • Jose Canseco – The former Oakland A’s outfielder who is synonymous with performance-enhancing drugs decla…

From $110 Million to Bankruptcy


Antoine Walker had the world by the tail in 1996. He was coming off a NCAA championship season with the Kentucky Wildcats and was chosen by the Boston Celtics as the sixth pick overall in the 1996 draft. Fourteen years later, he declared bankruptcy with assets of $4.28 million and $12.74 million in liabilities. Walker had managed to blow through nearly $110 million.

Walker’s story is not unique. It’s been estimated that around 60% of NBA players end up broke within five years after retirement. Most go broke for the same reason — massive overspending.

Many NBA players feel obligated to take care of family and friends after they strike it rich, but they do so in extravagant and unsustainable ways, as Walker did. Determined to do right by his mother and five siblings, he built multi-million dollar houses for his entire family.

Walker certainly was not shy in spending on himself, either. He bought multiple expensive cars, including a $350,000 Maybach. Throw…

Tips for Seniors to Manage Their Debt


You should be enjoying the fruits of your labor in your later years, not worrying about how to pay back debt. Unfortunately, too many seniors find themselves with high levels of debt and uncertainty about their future.

If you are in this situation or heading that way, consider these steps to reverse your slide into debt.

  • Analyze Your Cash Flow – The first challenge of managing your debt is to stop it from growing. (Our government may not have figured that out yet, but you can do better.)

    Take a hard look at your spending and look for discretionary purchases to cut. If you do not have a budget, make one. Take into account any short-term changes in income or expenses so you can realistically assess the situation.

  • Prioritize the Debt – If you have more than one source of debt, prioritize them so you can pay down the most d…