In January of last year I predicted (see Notable Bankruptcies of 2009: Q1) that “major” corporate bankruptcies in 2009 would challenge the 383 mark set in 2001 (the high-water mark after the dotcom bubble). I even suggested that it was possible that we could exceed 400 “major” corporate bankruptcies in 2009.
It looked good for awhile, …but what a difference a year makes!!
Taking a measure of the economy is a matter of reviewing employment, consumer spending and manufacturing – and throw in a few financial measures for spice (such as liquidity and interest rates).
All means of measuring the economy are imperfect to varying degrees. GDP fails to account fully for financial transactions. Employment / unemployment cannot capture data (and must estimate) large segments. Timely issued retail sales only captures the big boys. Manufacturing is a shrinking portion of the economy.
Obama rolls out financial reforms. Obama laid out his vision for overhauling financial regulation, promising to end 'a cascade of mistakes... over the course of decades' that led to the current crisis. As expected, his plan calls for increased capital cushions at banks, regulation of over-the-counter derivatives, a new agency to regulate financial products for consumers and greater power for the Federal Reserve over systemic risk. However, it only partially addresses a promised top-to-bottom overhaul of regulatory agencies, and stops short of proposing a merger of the SEC and CFTC....
On a serious note, Eddie Bauer (Nasdaq:EBHI) has filed for Chapter 11 on Wednesday. The company is known for outdoor-like clothing. It is said that CCMP Capital Advisors LLC has bid $202 million in cash for its assets.
Other buyers may also make bids while the company is under court protection. Bankruptcy rumors had been swirling as Bellevue, Washington based Eddie Bauer struggled with slumping sales amid the recession. This is probably still the beginning of the end for many specialty retailers and "non-necessity" purveyors.
As the recession deepens, economic forces continue to drive consolidation in the retail industry, debt comes due and increasingly discerning consumers buckle down on discretionary spending, an analysis by 24/7 Wall Street predicts that a number of well-known brands are likely to disappear before the end of 2010.
Wal-Mart (NYSE: WMT) tops Standard & Poor’s latest credit ranking of US retailers, the only publicly traded company with a credit rating of AA/Stable/A-1+, with excellent business risk and minimal financial risk.
At the other end of the scale BI-LO LLC is the only firm with a D- credit rating, edging out Harry & David and Sbarro (both rated CC-). All three are rated vulnerable on business risk and highly leveraged on financial risk. The lowest-ranked...
Plenty of stocks look cheap right now, says Barron's Eric Uhlfelder, but that doesn't make them bargains. Once a stock slides below the $5 mark, it's usually a long, tough climb out of the bargain basement.
In 2008, many of the companies that became penny-stocks were household names, or at least well-known on Wall Street. They included retailers Rite Aid (RAD), Pier 1 Imports (PIR), Eddie Bauer (EBHI); radio broadcasters Westwood One (Add as favourites (0) | Quote this article on your site
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