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Local Farmers at Risk Through Tariffs

Farmers Tariffs - Bankruptcy

Indianapolis Bankruptcy News

Farming in central Indiana has already gone through difficult times. Many farmers have faced growing balances on operating lines of credit. Farmers near Indianapolis also always face the inherent instability of farm product markets. This particular problem, poor market prices, is being intensified by trade war tariffs.

Local Soy Bean Farms Hit Hard

One of the worst hit products is soybeans, which are now at a 10-year low. Many farmers refused to sell at these lower prices last year, hoping to ride out the market storm. However, farmers can only store soybeans for a limited period of time. They can also only store their full crop if they have the facilities for it. They will be forced to sell soon, regardless of market pricing.

Although there are numerous uses for soybeans, the market is being stunted by the retraction of the Chinese export market. The U.S. market still demands high amounts of soybean products, but the Chinese retraction as created a serious over-supply problem. Farmers may be forced to alter their operations in response to this demand change. To make matters worse, fears are growing that the Chinese market could eventually be fed by foreign markets instead of the U.S. market, permanently replacing this demand sector.

Other Farm Producers Also Hit Hard

Although the soybean market is a good example, other farm markets in Indiana are also being hit. With many farms operating on tight margins and operating loans, the smallest fluctuation in market prices can hit hard. To make matters worse, many of these market fluctuations are unprecedented in recent times. Many farm operations could face insolvency and bankruptcy. A trend towards more farm bankruptcy filings may be lurking right around the corner. Operations that were barely paying the bills may not be operating in the next 2-3 years.

Trade Negotiation Needed Soon

Although many farmers are not against these tariffs in principle, most farmers agree that major trade negotiations should be completed as soon as possible. Even beyond the farming sector, many other sectors of the economy are getting hard by the tariffs including tech industries, automobile markets, and steel. Although many favor trade negotiation, most people want to get these new agreements in place as soon as possible so that tariffs can stop across the board.

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Student Loan Crisis Looms – Are Current Solutions Constitutional?

Student Loan Crisis

As the student loan crisis looms, many proposals to this crisis are being presented in anticipation of the next presidential election. Various presidential candidates are presenting their own solutions. Questions come quickly into play – such as are these solutions constitutional? Is bankruptcy or something else the best solution?

Elizabeth Warren’s Student Loan Solution

Elizabeth Warren, a former law professor and current Democratic candidate for president, has proposed canceling $50,000 in student loan debt for individuals whose household income is below $100,000. This process would be automatic and apply to both private and government-backed student loan debt. This could effectively cause the forgiveness of up to 75% of those currently holding student loan debt in the United States. The process will happen directly with current credit information and former tax returns.

Although this proposal appears to be very powerful and desirable to many Americans, it appears to be blatantly unconstitutional. Without full government compensation (which would be devastating to the Treasury and tax burden), this proposal would directly violate the contracts clause and takings clause of the Constitution. To make matters worse, this proposal would relate the debt-forgiveness to income. The people paying the most taxes would likely receive the least benefit from the forgiveness program. They would also possibly be required to “pay the bill” dependent upon the method in which the loans are “forgiven.” Interestingly, many other programs proposed also follow Warren’s lead, making them income driven and a full, forced forgiveness.

Obvious and Simple: Bankruptcy is Constitutional

There is an obvious long-term solution to the student loan crisis. This obvious solution is to allow student loans to once again be fully dischargeable in bankruptcy. This would return to the root of the problem and fix it at its source. The entire student loan problem originated with “student loans” being put into a separate class in the first place.

Student loans are not the usual loan situation: they are heavily protected and easy to generate. What other unsecured loans can you generate in large amounts right when you reach the age of 18 for college? Student loans have turned education into big business. They have breached the sacred nature of education and turned everything into a big-business type model. The schools, even the best of them, have become predatory by aggressively seeking to fill up their rosters at the highest cost possible. All of the schools have systems for easily coupling each student with future, burdensome student loans

This can be seen the clearest by examining the recent wave of “for-profit” schools that have recently been shut down. These schools were enrolling the least qualified of students for meaningless educational programs. The predatory nature of these schools was obvious. They had entire classes of students burdened with high student loan debts with virtually no value received for their “educational” program. The one thing most of these schools had in common was an eager and convincing enrollment officer. Everything was set up for the young student to sign easily on all lines necessary for a student loan to pay for the school’s programs. Are the rest of the public and private schools honestly much different?

Student loan debts should have never been made non-dischargeable in bankruptcy. Returning student loans to a “dischargeable” status in bankruptcy would be the great equalizer. Over time, student loans would no longer retain a special, “god-like” status to oppress young people eager for higher education. Student loan decisions would be made like all other loan decisions: they would be based on the likelihood of the person actually to pay the loan back. Education would no longer be big-business funded by never-ending supplies of debt-based “funny-money.” Education instead would be about actually educating those who are best qualified and dedicated to receiving advanced education or training. The College and University system was just fine before student loans were made non-dischargeable. It will adapt to find the same balance after student loans are dischargeable in bankruptcy once again.

Dress Barn Closings – Indianapolis Bankruptcy News

Dress Barn Closing

As the retail apocalypse continues, Dress Barn decides to close all of its 650 stores. Although this kind of news seems like the new “norm,” the numbers are truly shocking. It is estimated that a total of almost 6,000 to 7,000 retail stores will close in 2019 alone. Dress Barn, however, will be a large hit across the United States. They currently employ about 6,800 people who could soon face losing their jobs.

Not Enough Profit to Warrant Continued Operations

Dress Barn’s chief executive officer has simply stated that Dress Barn has been unable to generate acceptable levels of profit for the company store to continue. The parent corporation for Dress Barn is Ascena Retail Group, INC has stated that it wants to build more successful brands that the company owns, including Lane Bryant and Ann Taylor clothing retailers. The rumors of such a massive closing have already caused the trading of the companies shares to drop to almost a 50% value.

The Closings Effect on Indianapolis

Currently, there are 16 Indiana Dress Barn locations. Several of these locations are located in the Indianapolis greater area. All these central locations will be eventually closing including Avon, Plainfield, and Noblesville. The retailer has been popular for quite some time in Indiana. The brand itself is 50 years old. It has served the retail market successfully for decades. It will be sorely missed by its Indianapolis customers, being a staple retailer in the area for years.

The Trend Continues

Retail stores have been closing in record numbers over the last 5 years. This trend is rooted in the online retail revolution and other changes in demographics.  

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Steak n Shake Temporary Closings Continue- Indianapolis Bankruptcy News

Steak n Shake

As sales decrease at Steak n Shake locations throughout the United States, the closing of multiple locations has begun in Indianapolis. The corporation who owns the corporate side to Steak n Shake is located in San Antonio, Texas. This company, called Biglari Holdings, Inc, has stated that these closings are only temporary.

Temporary Closings Making Way For Franchise Agreements

Steak n Shake locations are usually owned and operated by their corporate office. The company is now marketing a new franchising system where owner-operators can take over individual locations. These franchise opportunities are designed to create meaner, leaner operations where owner-operators can take pride in operating (and possibly also save) their individual locations. The corporate office wants to transition into a franchising system which it hopes will eventually generate good profit and make its own operations much more simple. The corporate office is stating that these Indianapolis closings are only temporary. These closings are part of the transition between corporate to franchise-style operations.

Indianapolis Steak n Shakes that Have Closed

Biglari Holdings has closed at least four Indianapolis locations. The closed locations are on the Northeast and West side of Indianapolis only. These temporarily closed locations are at the following addresses:

  • West Closings: 3810 West Washington Street, 5635 West 38th Street – Indianapolis
  • Northeast Closings: 5827 East 71st Street, 4105 East 96th Street

Remember, these closings are currently slated to be “temporary.” If a franchise agreement can be made for each location, it is possible that these locations could soon reopen.

Is Steak n Shake Bankruptcy Possible?

Even though Steak n Shake has been taking hits in comparison to its robust past, there is currently no indication that bankruptcy filings are expected or imminent. Steak n Shake’s corporate office has been taking serious steps to rectify many of the location’s poor earning records. This new franchising model could cause a major shift in operations that could also prevent future losses. Although Steak n Shake may have to close some locations and revamp operations, it appears too early to tell how the brand will fair after many of these much-needed changes are put into action.

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Transitioning to a Summer Budget

Summer Budget

Transitioning to a summer budget can be a powerful way to save money and reduce expenses. As summer approaches, the warmer season offers a unique opportunity to revamp your financial life to make it much easier. You can easily transition to a summer budget with three easy steps.

Step One: Mark All Places Where You Can Save Money

Transitioning to a summer budget can be all the sweeter if you can find ways to live more affordably. Mark all the places where you can save money before you even get started. Beyond the normal savings points, summer offers unique opportunities to reduce expenses. Unless you live in hotter climates, utility costs can be drastically reduced due to the better weather. Make commitments on reducing utilities during the better seasons in order to save money. Also, entertainment costs can usually be reduced with a variety of outdoor activities. As you approach the summer, it is a great time to budget as the rest of the year approaches. Find ways to save in order to open up opportunities during the rest of the year such as investments or even taking vacations.

Step Two: Create Your Summer Budget

After marking places where you can save money, making your summer budget should be much easier. Write your income and expenses amounts on two columns. Make sure to be very realistic: do not exaggerate your income or understate your expenses. A budget is only effective if it can actually be followed. When your budget is complete, make sure to post it in an area that is easily viewable. Your summer budget should try to leave over as much money as possible as disposable income. This “leftover” money should be saved each month religiously as you make plans on how you will eventually invest it.

Step Three: Put Your Budget into Action

The final step in transitioning to your summer budget is to put it into action. Your budget is only effective if it actually reviewed and followed. Commit to following each budget item, not over-spending on any particular item. After the first couple of months, look into your payment totals and compare them with your budgeted amount. This review will allow you both to analyze whether your budget was actually followed. It will also reveal if corrections should be applied to any particular category. Following a summer budget is not burdensome. It can even be enjoyable. Knowing that you are enjoying life while keeping close track of your money can be a very rewarding feeling. The things that make life the most enjoyable in the summer are usually not related to how much money is required to make them happen. A summer budget can help you recapture the enjoyment of summer that cannot be bought with money.

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