The Retail Apocalypse has DESTROYED these 14 companies

According to this Business Insider report, the retail apocalypse has essentially crashed the share price of these 14 major retailers. I guess these are the lucky ones as many have been put out of business completely.

Shares of Amazon multiplied by a factor of ten since 2009. Shares of Wal-Mart are flat over the past five years but are up 30% since the beginning of 2016. Since mid-2015, shares of Best Buy are up 58%, Home Depot 28%, and Costco 10%. These and other retailers like them saw their share prices rise because they managed to navigate the new retail environment.

Many online retailers and online operations of brick-and-mortar retailers are thriving. Other retailers are thriving because, like Home Depot, they’re in a segment that is booming. So not all brick-and-mortar retailers are melting down. But many are, including the samples in the list below. The percentage denotes the crash in share prices over the past two years:

  • Sears Holdings -65%
  • Macy’s -68%
  • Target -35%
  • Bed Bath & Beyond -59%
  • Hudson’s Bay (owns Saks and Lord & Taylor) -61%
  • Nordstrom -39%
  • American Eagle Outfitters -32%
  • Tailored Brands (formerly Men’s Wearhouse) -81%
  • Boot Barn -80%
  • Christopher & Banks -68%
  • Express -64%
  • Urban Outfitters -47%
  • Foot Locker -32%

And they’re the lucky ones among the brick-and-mortar meltdown lot; others have already filed for bankruptcy, and their shares have become worthless. Yet some of those on the list will likely join the bankruptcy filers over the next 12 months.

Rahm Emanuel speaks on Chicago’s pension crisis: “Our hard work is paying off….It has stabilized the city’s finances”

I don’t know what planet Rahm Emanuel lives on (Israel)  but his latest comments regarding Chicago’s pension crisis reveal he is nowhere near planet earth. According to this Sun Times report Emanuel claims they are stabilizing Chicago’s finances.

Standard & Poor’s surveyed pension obligations in New York, Los Angeles, Chicago, Philadelphia, San Francisco, San Diego, San Jose, San Antonio, Phoenix, Jacksonville, Dallas, Houston, Columbus, Indianapolis and Austin.

Chicago performed the worst across the board — registering the highest annual debt, pension post-employment benefits costs as a percentage of governmental expenditures and the highest debt and pension liability per capita.

The burden in Chicago is $12,427-per-person, double New York city’s $6,115-per-person.

Chicago also had the lowest weighted pension fund ratio, the worst pension contribution vs. required level and the lowest funded return for a single fund.

That dubious distinction went to the Chicago Police Annuity and Benefit Fund, which had assets to cover just 25 percent of its liabilities in fiscal 2015, down from 26 percent the year before.

The report noted that the “median weighted pension funded ratio of 70 percent” for the 15 cities “underlies a wide range of positions with Chicago only 23 percent funded across all plans and Indianapolis the most well-funded at 98 percent.”

Chicago also had the lowest bond rating among the nation’s fifteen major cities, at BBB-plus with a stable outlook. Every other big city had at a bond rating of AA-minus or better. Austin, Columbus and San Antonio have a triple-A bond rating.

Given weak market returns in 2016, funded ratios reported in fiscal 2016 are likely to look worse for most cities, the report states.

“Pension liabilities are a clear credit weakness for Chicago, which stands out with the highest pension liability per capita and the lowest weighted funded ratio among peers,” the report states.

“Chicago’s combined debt service, required pension and actuarial [post-employment benefits] contributions represented the highest share of budget among the largest cities at 38 percent of total governmental fund expenditures in 2015. Of that amount, 26.2 percent represented required contributions to pension obligations.”

S&P noted that Chicago “only made 52 percent of its annual legally required pension contribution” in fiscal 2015.

While Mayor Rahm Emanuel’s 2017 budget contributes more toward employee pensions, amounts budgeted still fall significantly short of the actuarially determined contributions levels,” the report states.

The rating agency noted that dedicated funding sources have now been identified for all four city employee pension funds. But, Emanuel’s plan to save the municipal and laborers pension funds is still awaiting the governor’s signature.

The Illinois House unanimously approved the plan, only to have the governor declare his intention to veto the bill that locked in employee concessions and authorized a five-year ramp to actuarially required funding.

“Notably, the city is unable to change pension benefits for its existing employees due to state constitutional constraints, but has increased contribution requirements for new employees,” the report states.

The mayor’s office had no immediate reaction to the S&P report.

Last fall, Standard & Poor’s affirmed Chicago’s bond rating at three levels above “junk” status, but changed the city’s financial outlook from “negative” to “stable,” thanks to Emanuel’s plan to slap a 29.5 percent tax on water and sewer bills to save the largest of four city employee pension funds.

At the time, S&P said Chicago was “gradually moving in the right direction toward stabilizing its budget and pension plan contributions” and that the utility tax, “coupled with adjustments to benefits offered to new hires” were “tangible steps that forestall credit deterioration” in the near term.

“However, in order to ensure the long-term sustainability of its pension contributions and continued credit stability, we believe that the city will need to identify additional measures to address its mounting pension contributions within the next two years,” that report said.

Emanuel called the outlook upgrade a well-earned recognition of the work that he and the City Council have done to reduce the city’s structural deficit by “more than $600 million” while identifying permanent funding sources for all four city employee pension funds.

“Our hard work is now paying off. . . . It has stabilized the city’s finances,” he told the Chicago Sun-Times.

But, the mayor agreed with S&P that the job is not done.

He has openly acknowledged that the city’s largest pension fund would still be left with a gaping hole in 2023 — even after the utility tax is fully phased in. That hole will require “more revenue” to honor the city’s ironclad commitment to reach 90 percent funding over a 40-year period.

Chicago taxpayers have paid a heavy price for easing the city’s $30 billion pension crisis.

Home ownership plummets as renting becomes the new norm

More bad news for the bankers. According to this Newstarget report, home ownership rates are plummeting across the United States reaching levels not seen since 1965.

Analysis of the Center Bureau housing data revealed that from 2006 to 2016, the total number of households headed by renters had increased by 36.6 percent, a number which almost beats the record high jump of 37 percent in 1965. Authors at the Pew Research Center who published this report concluded that the lingering effects of the recent housing crisis has influenced buying strategies. They noted that the number of people who opted to buy a home had remained stagnant for a decade, with more young professionals (aged 35 and younger) choosing to rent. Researchers also observed that the trend is evident even among demographic groups known to not rent, including whites and middle-aged adults.

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Hermès Birkin handbags found to be a better investment than top stocks and gold

Interesting article coming from Baghunter.com. According to their research luxurious handbags have outperformed stocks and gold.

In light of recent record-breaking sales involving Hermès Birkin handbags at auction in both Asia and Europe, along with increased interest and record sales on Baghunter, we have performed additional research to offer an update of our original study discussing investment opportunities. This update takes into account the occurrences over the past 18 months since our initial study was published and looks at whether the Birkin bag continues to offer a sound investment option, how it has compared to the S&P 500 and gold over this period and any other relevant factors which have occurred during this time.

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50% Of U.S. Shopping Malls expected to close by 2023

The end of an era is quickly approaching. According to this Guardian report, 50% of U.S. shopping malls are expected to close by 2023.

Twenty-five years ago this August, the Mall of America, America’s largest shopping mall, opened its many, many doors for business. The Minnesota mall is currently wrapping up a year of celebration at the dizzyingly vast temple to consumerism. It’s a celebration that comes, ironically, as America’s malls are dying. But not the Mall of America.

Once the epicenter of American retail, malls are in crisis. Pictures of dead malls, their hollow shells left like abandoned sets for a George Romero zombie movie, are rapidly replacing pictures of decaying Detroit as the go-to image for dystopia USA.

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FedEx Canada set to close ALL retail office locations, HUNDREDS of jobs lost

Shipping giant FedEx has announced they will be closing all 24 FedEx office stores throughout Canada. According to this City News report, hundreds of jobs will be lost.

FedEx is closing its Office stores in Canada after 32 years in the country.

Spokeswoman Stacey Sullivan says FedEx Office will close its 24 stores, a manufacturing plant in Markham, Ont., and its head office in Toronto.

The move will result in the loss of 214 jobs, but will not affect FedEx’s shipping business in Canada, she said, adding the decision was made after assessing current and future business prospects.

Eighteen of the stores are in Ontario, five in B.C. and one in Nova Scotia. The closings are to begin in August.

FedEx Office shops offer a range of business services including copying and printing, sign making, office supplies sales and packaging services.

The stores are also used as pick-up and drop-off sites for FedEx shipping.

Is the ELD Mandate Going to Destroy Small Trucking Businesses

The infamous ELD mandate the government proposed made quite an impact on the trucking industry before it was even implemented. If you are a company trucker or own your own business you are likely already familiar with the term. The industry is experiencing a significant growth with a tendency for improvement (as you can learn here: http://gotruckcapital.com/uncategorized/interesting-facts-us-trucking-industry/). However, truckers fear ELD mandate might change the positive predictions regarding the industry.

The Electronic Logging Device (ELD) is a piece of technology that is supposed to log the truckers’ hours electronically, replacing the log books truckers used up until now. The mandate requires all truckers to switch to ELDs by mid-December.

Many truckers fear how this change might impact the rates, the capacity, service levels and the trucking industry in general. Small trucking business owner particularly fear the ramifications of this new mandate, as this technology means a tighter grip on their working hours. Small truckers were largely independent up till now, but suggest that this mandate might mean the government will have a tighter grip on their operations.

How Do ELDs Work?

Truckers are already familiar with the procedure of logging their working hours and submitting these to the authorities if asked. This system is set to make sure drivers don’t go out on the road for more than 10 hours per day, as it may compromise their safety.

This mandate was completed in early 2016, giving truck owners almost two years to adapt to the changes. The ELDs are linked with the truck’s computer. This allows them to monitor the engine and whether it’s running or at rest. Therefore, the concept of ELDs is aimed towards keeping the drivers safe.

At least, that’s the official version.

Why Are Drivers Opposing This Mandate?

Medium and large companies are already working on implementing the new logging devices into their fleets, and so far the results are positive. However, it’s the small companies and owner-operators that take issue with this system.

The main issues small companies have with the mandate are the cost of adding ELDs to their trucks, as well as numerous privacy concerns. Adding an ELD to a truck costs around $600 and has a monthly subscription fee. This means more monthly expenses for truckers who try to make ends meet after paying for repayment rates, maintenance, and other fees.

The ELD will also limit their hours of operations, which will impact their earnings. Owner-operators tend to work longer hours to deliver a haul, and with ELD that will not be possible.

How Will It Affect the Trucking Industry?

Since the mandate was first presented, a lot of owner-operators threatened to hang their keys before they switch to ELDs. This will definitely make the truck driver deficit that’s plaguing the industry even worse.

However, it is mainly truckers near retirement who are less likely to meet the new mandate. While this is certainly a great loss for the industry, there are still a lot of young truckers willing to embrace the change and make it work for them.

Furthermore, as the number of companies producing ELD increases the price is going to be more affordable for the average driver. The FMCSA also announced that they are working on developing a mobile app that can be used instead of the ELD. Both will significantly reduce the impact the new mandate has on a trucker’s budget.

SLOW DEATH: Sears inks $200 million credit line from CEO Eddie Lampert’s hedge fund

Sears, the company that refuses to die has secured a $200 million dollar lifeline according to this CNBC report.

Sears Holdings has landed a fresh line of credit, valued at $200 million, from its CEO Eddie Lampert’s hedge fund, according to a Monday filing with the Securities and Exchange Commission.

On July 13, Lampert’s ESL Partners entered into a short-term line of credit loans, which carry a maturity date of 151 days and a fixed interest rate of 9.75 percent per year, Sears said.

“This facility is intended to provide the Company with the flexibility to generate additional liquidity on an as-needed basis,” Sears CFO Rob Riecker said in a statement.

“This adjustment to our capital structure demonstrates that Sears Holdings will continue to take actions to generate liquidity and manage our business while meeting all of our financial obligations.”

Sears’ stock surged 9 percent higher Monday morning following this news. Shares are now up more than 32 percent from one month ago. This, compared with a loss of nearly 40 percent over the past 12 months.

In 2017, Sears has been trimming its real-estate portfolio — shuttering unprofitable stores — and making moves, such as opening smaller locations that only sell mattresses and appliances, to stay afloat.

Dwindling foot traffic across American malls is dragging many department stores down with it.

Earlier this year, media shy CEO Lampert sat down for an interview with the Chicago Tribune in which he said the retailer is “fighting like hell” to battle negative headlines and pessimism regarding Sears’ ability to continue.

Average FICO score hits an all-time high

When it comes to credit, Americans are faring better than ever.

For the first time, the average national credit score has reached 700, according to FICO, developer of one of the most commonly used scores by lenders. FICO scores range from 300 to 850.

Your credit score plays a big role in daily life. It can determine the interest rate a consumer is going to pay for credit cards, car loans and mortgages — or whether they will get a loan at all.

Average credit scores most recently bottomed out at 686, during the housing crisis when there was a sharp increase in foreclosures. They have steadily ticked higher since then, according to Ethan Dornhelm, vice president for scores and analytics at FICO. Now scores are at an all-time high.

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Sears to close 43 more stores

Sears is closing another 43 struggling stores.

Sears Holdings — the parent company of Sears and Kmart — announced on Friday that it will shutter eight of its namesake Sears department stores and 35 Kmart locations, adding to the list of 236 stores Sears has announced plans to shut down in 2017.

With the newest round of closings, Sears Holdings is poised to close down about 20% of its locations.

The company said in a blog post that the store closures are part of an ongoing effort to “focus on our best stores and return to profitability.”

“This is part of a strategy both to address losses from unprofitable stores and to reduce the square footage of other stores because many of them are simply too big for our current needs,” Chief Executive Officer Eddie Lampert said in the post.

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