Monday morning potpourri
How bad was Cleveland Quarterback Johnny Manziell in his first game as a starting quarterback? My brother summed it up well: He was so bad me made Geno Smith of the Jets look like a good quarterback. …
The Supreme Court on Friday decided to take two nuts-and- bolts bankruptcy cases that could have an operational impact on your credit union. As explained by the Fifth Circuit “A debtor who is unwilling or unable to continue paying creditors under a Chapter 13 plan may convert his case to a Chapter 7 liquidation at any time.11 U.S.C. § 1307(a). Because of the differences between a Chapter 13 estate and a Chapter 7 estate, such a conversion raises an inevitable question: does the Chapter 7 estate include all property held by the debtor at the time of conversion, or does it include only the property held at the time of the original Chapter 13 filing?” In Bullard v. Hyde Park Savings Bank the Court will decide if money in the possession of a Chapter 13 trustee can be distributed by that trustee after the debtor has converted to a chapter 7 bankruptcy or must be returned to the debtor? At least one court in New York that has examined the issue has held that a trustee is free to distribute funds to creditors- In re Bell, 248 B.R. 236 W.D.N.Y. 2000)- but other courts have disagreed.
A second case, Vieglelahn-v.-Harris–13-50374–5th-Cir.-2014, will rule on whether a debtor has a right to appeal a court’s refusal to confirm a bankruptcy plan. The case involves an underwater homeowner who filed for bankruptcy protection. The homeowner proposed a repayment plan which would have reduced the secured value of the mortgage loan. Hyde Park Savings Bank understandably objected and the court refused to confirm the plan instead ordering our homeowner to come up with another plan within 30 days. The Homeowner is seeking to appeal the court’s refusal to confirm his plan. It seems to me that if the Court rules in favor of the homeowner we face the prospect of even longer delays in resolving disputes involving delinquent mortgages. Oh Boy!
Starting today the Credit Union Association of New York is the New York Credit Union Association. Henceforth anyone who refers to the Association as CUANY can be shot on sight. This is bad news for me because it takes me about six months to remember anyone’s name and I still refer to the Tampa Bay Rays as the Devil Rays….
Session not Lame for Banks
The banks did pretty well in the lame Duck session. The budget deal the Senate signed off on s Saturday waters down a swaps provision in Dodd Frank designed to prevent banks from gambling-I mean investing-with Insured deposits. Smaller bank holding companies will also benefit from legislation allowing those with $1 billion or less in assets more flexibility in the amount of debt they can take on before being subject to greater over site by the Federal Reserve .
Democracy is working better in some countries than in others. Conservative Japanese Prime Minister Shinzoe Abe scored a decisive victory in parliamentary elections he called just days after his country slipped back into recession. That’s right he won a decisive election weeks after it was confirmed that the world’s third largest economy is still in the tank. Why should you care? Because Abe is a proponent of quantitative easing and is likely to put off taxes meant to reduce Japan’s National debt in order to emphasize economic growth. In contrast the US is cutting back its government spending and ending quantitative easing on the assumption that the economy doesn’t need the stimulus. If our policymakers are wrong the economy is in for another five years of anemic economic growth even as corporate profits continue to grow