Before changes to bankruptcy laws in 2005, creditors argued that consumers abused their right to discharge debt. Currently, however, most experts agree that the economy is the phenomenon at work — job losses, cut backs, medical problems, and family breakups have effected people who were otherwise living within their means.

According to the American Bankruptcy Institute, 98,344 consumers filed for bankruptcy protection last month, with a projected 1.4 million for the rest of 2009. Even business bankruptcies are on the rise.

As people run out of credit, they turn to bankruptcy. But economic stimulus packages and other government interventions may provide some relief to the credit markets, which may slow the rate of filings.