Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (21668)	11/11/2002 12:52:04 PM
From: pogbull	Respond to of 36161

Article: Bankruptcies set to surge ahead of new law 4FigureAU posted this on his thread earlier today. By Robert Clow in New York Published: November 10 2002 21:56 \| Last Updated: November 10 2002 21:56 news.ft.com Experts are predicting a wave of US bankruptcies before legislation that is now expected to be pushed through rapidly by the Republican-dominated Congress. The Bankruptcy Bill, which, according to corporate restructuring experts, will make it more difficult for bankrupt companies to restructure, has been held up over a clause backed by anti-abortionists. But observers believe that, following their strong showing in last week's elections, the Republicans will no long feel the need to court their pro-life constituents and will let the bill through. The bill will go back to the House of Representatives for consideration this week. Trent Lott, the new Senate majority leader, predicts it could be passed by Congress even before the new legislators are sworn in to office in January. Among its provisions are removal of companies' exclusive right to put forward a reorganisation plan, a move that restructuring experts say would significantly reduce management's power. Wilbur Ross, whose investment company, WL Ross, is usually a bankruptcy creditor, said the prospect of the legislation could push some companies teetering on the brink to file before the bill becomes law. He pointed to the example of Mexico where there was a rush of filings before its bankruptcy legislation came into force. Mr Ross believes it is right to tighten the law to tilt the balance away from companies and towards creditors. "I've always thought judges give debtors too much latitude," he said. David Resnick, head of Rothschild's restructuring practice in New York, said the new legislation might mean companies going in to Chapter 11 filing better prepared. "Companies will focus on these problems earlier and do a lot more planning out of Chapter 11 because they will know there are significant costs when they do hit the button," he said. The bill is mainly designed to strengthen banks' and credit card companies' positions in dealing with delinquent retail customers. It had been held up by abortion opponents before the Congressional elections because of language inserted by Charles Schumer, a Democratic senator, designed to stop abortion protesters avoiding fines and civil liability by filing for bankruptcy. Other provisions in the bill include limiting the time a company can take to decide whether to assume or exit a lease.