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Economy
Moody's: Sears' and Kmart's shutdown is imminent
2016-09-15
This is sheer, sad stupidity. Talk about walking away from your core business! Sears (and its rival, the late Monkey Ward) used to be what Amazon is, in pre-technology days. You got their "web site" in the mail every month, and they'd ship you anything from a pair of shoes to a house (you had to put it together yourself). K Mart is the offspring of the Kresge 5 & 10 stores, and were what WalMart perfected. As mail order tanked, K Mart bought Sears, with the holding company in the Sears name. Neither company saw the potential of the internet and neither has a significant internet presence. I guess the Triceratops was a good idea at one time, too.
[BUSINESSINSIDER] Moody's analysts say Sears and Kmart don't have enough money -- or access to money -- to stay in business. In a note published Wednesday, the analysts downgraded Sears' liquidity rating, saying the company is bleeding cash and will have to continue to rely on outside funding or the sale of assets, such as real estate, to sustain operations.
The Langston by Sears & Roebuck, circa 1920. Shipped into town by train, pieces numbered with blueprint and assembly instructions. I don't believe the Langston had an indoor privy. Some of the larger models did.
"We recognize the risks associated with relying on these sources and continued shareholder support to finance its negative operating cash flow which is estimated by Moody's to be approximately $1.5 billion this year," the analysts wrote.

Kmart in particular is at risk of shutting down, according to Moody's.

"The ratings... reflect our view on the uncertainty of the viability of the Kmart franchise in particular given its meaningful market share erosion," the analysts wrote.

Sears said in August that its cash and equivalents have fallen to $276 million from $1.8 billion one year ago. As a result, the retailer was forced to accept $300 million in financing from Sears CEO Eddie Lampert's hedge fund, ESL Investments, in the most recent quarter.

The company is losing cash as sales plunge at its namesake and Kmart stores. Net sales fell 8.8% to $5.7 billion in the second quarter. Same-store sales plunged 7% at Sears stores and dropped 3.3% at Kmart stores.
Posted by:Fred

#12  I've dealt with Sears twice. First, I ordered online some clothes, some long underwear. They never arrived. Second, we arranged for a measure and quote for a kitchen renovation. Set a time and nobody showed up. There wont be a third time.
Posted by: Grunter   2016-09-15 22:26  

#11  There's a lot of ruin in a man tool aisle.
Posted by: Shipman   2016-09-15 22:10  

#10  #1 ...I'll believe it when I finally see it.

It took roughly two decades to kill off Venezuela.

Last couple times I was in a Sears, it seemed pretty empty.

As for the Triceratops, they used to kick ass. But the world has moved on and being a Triceratops ain't what it used to be.
Posted by: SteveS   2016-09-15 17:53  

#9  Well those large portions are just so unhealthy for The Children.
Posted by: swksvolFF   2016-09-15 17:26  

#8  ..we'll call that qualitative easing [as a result of quantitative easing].
Posted by: Procopius2k   2016-09-15 17:14  

#7  A parallel observation since I do most of the food shopping for the family now, the prices for items have been fairly slow to rise, but the quantity shrinkage is amazing, slowly smaller soda amounts, less net weight in prepackaged foods, quantity of principle ingredients lessened, everything is about max profit and the decline of quality. The exception is the carriage trade stores where the prices are upper tier but the quality is better. The Whole Foods phenomena and high end lunch places. A two-tier working society where one set makes 40-60k in fly over country and is glad for it, and the coastal enclaves where 120k is low end/entry level. That is certainly the case in Northern California, and by hearsay from family in SOCal as well. Can't see how this doesn't fracture soon......
Posted by: NoMoreBS   2016-09-15 16:19  

#6  Disappointed that Target didn't make the death watch list.
Posted by: Iblis   2016-09-15 16:11  

#5  What do the candidates say?

Let's throw some more money at it, or sayonara, thanks for all the fish?
Posted by: Bobby   2016-09-15 12:54  

#4  ..same as warranties held by Chrysler and Government Motors vehicle owners after the bailout. And that lifetime guarantee was about their lifetime not yours.
Posted by: Procopius2k   2016-09-15 12:35  

#3  we have sears appliances anda service contract

wonder what will happen
Posted by: lord garth   2016-09-15 09:10  

#2  First of the year. Warranty work is now only 30 days in automotive repair in my store. Quality is disappearing. People don't want to pay too much for anything. Look at food. Fast food sickness is upon us now. Cheep, cheep and more cheep. Less pay more work. Cut hours then what happens, No rotation of anything. Food sits in freezer in the back till pulled for preparation. Food store same thing. Sending our meats to China of all places to be processed. No label of origin. I can tell you auto parts come in nice boxes but product inside is destroyed at factory or poorly manufactured. Garments sent to Vietnam from China leave burn marks after you wear them. Cheap prices + Cheap results = No business. Now at this time when you visit your doctor they will ask you how often do you pee?. People are saying that after eating fast food they have to pee shortly afterward. Doctor said to a patient, yes , "I am seeing this problem increasing among my patients". To make red meats last longer for sale you add red dye. Sub sandwich dated goes out so you take the meat off and make a different sandwich. I can go on and on. Medical?, you would not believe the tricks there to save money.
Posted by: Dale   2016-09-15 07:55  

#1  ...I'll believe it when I finally see it. The experts have been predicting this for more than a decade. Beginning to think it's the world's biggest money laundering operation.

Mike
Posted by: Mike Kozlowski   2016-09-15 04:41  

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