YBK [Part 16]: Summertime is traditionally the coolest period of the year for bankruptcy filings, while spring and fall usually see most of the action. This is not surprising, since consumers always have big-ticket expenditures around the holidays at the end of the year, and family vacations and weddings in the middle; not until they get their first credit card bill afterwards do they finally begin the overdue process of reevaluating their debt situation.

Whether this summer will be any different may be critical to whether there is another Black Friday in October ten weeks from tomorrow. According to the Administrative Office of the U.S. Courts, bankruptcy filings soared to a record level in the quarter ending June 30, 2005. A total of 467,333 bankruptcies were filed, surpassing the previous quarterly record by over 7%, and as I mentioned last month, it beat the same period last year by 12%. Again, this has happened without any significant gains occurring in California, which has disproportionately benefitted from the Housing Bubble.