How to go bankrupt

I had been curious about how companies like Bear Stearns and Merrill Lynch (Pierce, Fenner, and Smith) had gone from seemingly sound to bankrupt so quickly. Well, it turns out that the magic that takes men from millionaires to paupers is not limited to Wall Street; you can do it too in a few easy steps. Here you go:

1. Whatever you do, do all of your business on credit. If your bank asks for 10% equity, offer 5%. Leverage everything to the max--a minimum reserve ratio is your maximum.

Good, you've got yourself in a very vulnerable position. What next?

2. Make sure that your actual assets are risky, very volatile investments. No "widows and orphans" stocks, bonds, and investments for you. Don't pay overly close attention to the balance sheets, either.

3. Add a mild downturn to your core business, and watch the magic of bankruptcy unfold before your eyes.

4. Bonus points are awarded for perjury, embezzlement, and interactions with Casa Nostra. Double bonus if you get the Fed to bail you out. Keep in mind that you can only do this if your foolishness costs others billions, though.

There you go. You're ready to try your hand at bankruptcy.

Of course, if you'd prefer NOT to live on ramen and be buried in a pauper's grave, you can go visit Dave Ramsey or Crown Financial . I'm sure you'll agree, however, that saving is for sissies.