Category: ECONOMY

Guaranty Bank Fails…107 Branches closing nationwide

Wisconsin based Guaranty Bank is DONE. According to this Patch report the small bank with just over 100 branches couldn’t recover from the housing crisis.

Wisconsin-based Guaranty Bank was closed Friday by federal officials, after the bank could not recover from the housing and mortgage foreclosure crisis.

Guaranty Bank is the fifth FDIC-insured institution to fail in the nation this year, and the first in Wisconsin.

A sale agreement brokered by the FDIC means that First-Citizens Bank & Trust Company, Raleigh, North Carolina, will assume all of the deposits of Guaranty Bank. Guaranty Bank did business as BestBank in Georgia and Michigan.

Guaranty Bank had 119 branches in five states, 107 of which were in retail outlets, such as grocery and general merchandise stores. The branches in retail outlets will not be reopening.

The 12 brick-and-mortar locations in Illinois, Minnesota, and Wisconsin will reopen as branches of First-Citizens Bank & Trust Company during their normal business hours. All depositors of Guaranty Bank, regardless of where they conducted business, will automatically become depositors of First-Citizens Bank & Trust Company.

San Francisco tech workers paying $1900 a month to sleep in bunk beds with 40 other people

According to this Venture Beat report tech workers are paying $1900 a month to sleep on bunk beds with 40 people. Welcome to the absurdity of San Francisco.

Zander Dejah, 25, pays $1,900 a month rent to live in a downtown San Francisco house with at least 40 other people, many of whom sleep in bunk beds.

Dejah is a resident of The Negev, a communal living space that styles itself as a home for millennial tech workers to brainstorm ideas, write code and create apps, even if they have to share toilets and bathrooms with dozens of others.

Houses like The Negev, located in a neighborhood known as “SoMa” or South of Market, have cropped up around San Francisco as an influx of young professionals, many of whom are tech workers, have faced the city’s notoriously high rents and apartment shortages. It has three floors and roughly 50 rooms, filled with bunk beds, beer bottles and laptops, according to residents.

Dejah, born and raised in New York, graduated last year with a degree in computer science and math from McGill University. Unemployed, he moved to California six months ago and found his room at The Negev on Craigslist.

“I thought New York was expensive,” said Dejah, who quickly landed a job as a virtual reality engineer at consulting firm moBack. “It’s basically an extension of college. We sort of live in a frat house.”

The home is certainly filled with parties on weekends, but the residents make sure to sit down every Sunday for a communal dinner, akin to a traditional family gathering.

While some say communal housing provides a solution for many first-time workers fresh out of college, such housing also has created its share of controversy. Housing advocates have complained that this new dorm-like style of living has pushed up rents and forced longtime residents to move out.

Downtown Cleveland retail vacancies hit 10.4 %

Cleveland continues to be plagued by a terrible ‘Midwest’ economy. According to this Crain’s report, downtown retail vacancies have hit 10.4%.

Following trends in national retailing and its own market, CBRE Group Inc. has started reporting downtown Cleveland statistics as part of its just-completed annual retail survey covering eight Northeast Ohio counties.

CBRE reported downtown vacancy at 10.4% among the 1.6 million square feet of selling space on the city’s broad thoroughfares and the long-suffering enclosed malls The Avenue and Galleria.

Surprisingly, that’s not far from areawide averages as retail gets roiled by oversupply and competition from the internet.

CBRE estimates the region has 11.7% retail vacancy as of year-end 2016 from 10.3% a year ago. However, regional asking rental rates climbed to $12.13 a square foot at year-end 2016 from $12.02 a square foot a year ago.

In-demand retail locations are able to command far higher rates than the regional ask, with taking rates at some new retail centers commanding rents of $40 a square foot. Adding more downtown retail specifics required the realty brokerage to rejigger its approach for a different selling environment.

Brandon Isner, CBRE research analyst, and two other staffers had to physically canvass the storefronts to produce the figure. The national brokerage also had to report street retail for the first time, a big switch from its traditional way of surveying about 400 shopping centers above 50,000 square feet in size in eight Northeast Ohio counties. Isner said additional downtown retail data is a natural response to increasing urbanization in the U.S.

Keith Hamulak, CBRE vice president, said the firm is getting increased queries about downtown retail space as well as neighborhoods such as Tremont and Ohio City.

“This is so we can drill down our data properly,” Hamulak said. “In the past, there was little demand from national retailers about downtown space. Now, national retailers want to know about downtown and Main Street retail locations.”

Moreover, the market is changing between proposed downtown developments such as Stark Enterprises of Cleveland’s 48-floor nuCLEus project in the Gateway District, which has 150,000 square feet of proposed retail space, and developers converting office buildings to apartments also want to revitalize their first-floor spaces with new retailers. All told, CBRE estimates 550,000 square feet of retail is proposed downtown.

Michael Deemer, executive vice president of business development at Downtown Cleveland Alliance, said having a national brokerage firm produce such information will be helpful as he is getting increasing requests for it.

Deemer said he personally estimated the figure at about 10%, but he believes many building and business owners he works with peg it at a much higher level.

“For a lot of folks in the marketplace, that will be a real surprise,” Deemer said. “In a lot of ways, I wish we had an earlier benchmark. As the downtown residential market has taken off, we could show how much the market has improved.”

The report is also useful given the leading role that chefs and quick-serve restaurants are playing in the retail sector.

Stephen Taylor, a CBRE vice president who focuses on restaurants, said that when he works with chefs in Cleveland or other parts of the state, they actively seek sites in revitalizing neighborhoods.

“It’s the walkability of the environment that is drawing them. Breweries are also serving as a catalyst for neighborhoods,” Taylor said. “It’s the attraction of storefront retail that was popular from the 1920s to the 1940s.”

Staples and Office Depot to close a massive amount of stores in 2017

Staples, Inc announced today that the company is planning to shutter approximately 70 locations in the United States before the end of the year.  The revelation comes after the companies sales fell 4% from last year.

Staples will also have to develop a strategic plan after their proposal to merge with competitor Office Depot was halted by an injunction from the FTC over antitrust concerns.  The FTC argued that a merger between the two biggest office supply stores would be anti-competitive and result in higher prices of pens, printer toner, and fax-machine paper.  Like most retailers, Amazon has become a huge thorn in Staples’ side, posing a huge competitive threat as Amazon plans to develop business contracts for office supplies as well.

The store closings do not come to as much of a surprise when you realize that more than half of Staple’s sales are online, making them the fourth-largest online retailer in the U.S. behind Apple, Wal-mart, and Amazon. 

Office Depot on the other hand closed 65 of its stores during its fourth quarters, and now intends to close an additional 75 locations in 2017.  The company also says in its annual report that was released Wednesday that they expect sales to be lower in 2017 than they were in 2016.

While neither of these stores should be considered down for the count just yet, the closing of a combined 175 stores in one year in the same market implies that both could to be edging towards the chopping block, especially since their merger was taken off the table.  The appliance market is already experiencing similar fear with the likes of Sears and hhgregg becoming nearly extinct. 

Ford announces $9,000 bonus checks to employees, second best in companies history

Ford has announced they will be issuing bonuses to thousands of employees. According to this NWI report, the company will be paying out its second biggest bonus in history.

Ford, one of the largest employers in the Calumet Region, is going to pay out $9,000 profit-sharing bonuses to thousands of local workers this week in what amounts to a pre-tax $49.5 million injection of cash into the local economy.

The Dearborn, Michigan-based automaker will pay the second-best profit sharing bonuses in company history Friday to about 4,200 workers at the Chicago Assembly Plant in Hegewisch and another 1,300 at the Chicago Stamping Plant in Chicago Heights. It’s down slightly from the record $9,300 Ford’s 56,000 United Autoworkers-represented employees took home last year.

Will appliance giants Sears and hhgregg make it through 2017?

It is only March, and already we have witnessed the increasing volatility of the retail industry. This year alone The Limited, Wet Seal, BCBG, and American Apparel have all filed for bankruptcy, and many other companies remain on the chopping block. In an attempt to avoid being next on the list appliance retailer hhgregg is taking drastic measures and laid out a plan this week that they hope will make the company profitable again.

Thursday hhgregg announced that the strategy would include closing three distribution facilities and 88 of their 226 stores that are underperforming, which is roughly 40% of their locations altogether. CEO Robert J. Riesbeck said in a press release, “This is a proactive decision to streamline our store footprint in the markets where we have been and will continue to be, important to our customers, vendor partners, and communities. We feel strongly that the markets we will remain in are the right ones for our customers and our business model.”

The states where stores are expected to close are Alabama, Delaware, Florida, Illinois, Georgia, Louisiana, Maryland, Missouri, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia and West Virginia. Distribution and delivery centers to close are in Maryland, Florida, and Pennsylvania.

Hhgregg has been in financial trouble for some time now. Their stock value has declined more than 60% over the last year, and they were even warned by the New York Stock Exchange that they could be delisted for failing to meet the minimum listing price requirement. Their financial trouble is very similar to that of competitor Sears.

It is no secret that Sears has been hanging on by a very thin thread over the last few years, and it appears that thread is about to spilt. They announced the closing of 150 stores to stop the hemorrhage of cash, but it could still prove to be too little too late.

Both Sears and hhgregg were considered top appliance stores during their hay days, but the continued poor economic climate and increase of competition has resulted in both stores losing their footing and stumbling into downward spirals financially.

Will these one-time appliance giants be able to make it through 2017? Because the question is no longer if, but when these companies will be forced to throw in the towel.

Boeing to lay off 1,800 Seattle area jobs

More bad news for Boeing as the Seattle area staple is ready to cut 1,800 jobs according to this Bloomberg report.

Boeing Co. is shrinking its Seattle-area workforce by at least 1,800 jobs this year as the company streamlines operations in a brutally competitive commercial-aircraft market.

The planemaker approved voluntary layoffs for 1,500 mechanics, according to a person familiar with the situation who asked not to be named because it hasn’t been made public. Another 305 engineers and technical workers are leaving voluntarily, Bill Dugovich, a spokesman for their union, said Thursday.

Boeing told employees in December that it would seek buyouts as part of an effort to cut costs and match employment to market requirements, company spokesman Paul Bergman said by email. Boeing also plans to cull commercial-airplane jobs by leaving open positions unfilled and through involuntary layoffs, he said. He declined to say how many buyouts have been approved.

Bitcoin is now worth more than an ounce of gold…

It’s a historic day for Bitcoin as the virtual currency has surpassed the price of gold according to this Market Watch report.

One unit of so-called digital gold is now worth more than an ounce of the real thing.

The price of a single bitcoin US:BTCUSD  rose to an all-time high of $1,251.32 on Thursday, surpassing the price of a single ounce of gold, according to CoinDesk’s bitcoin price index. Bitcoin traded on certain Chinese exchanges briefly overtook gold in early February. But this is the first time in the digital currency’s eight-year history that it has done so according to most widely used bitcoin-price benchmarks.

Many bitcoin watchers, including Charles Hayter, chief executive officer and founder of CryptoCompare, a company that provides data and analytics about digital currencies, have pointed out that bitcoin has a positive correlation with gold. They argue that investors are becoming more comfortable with the digital currency, making them more willing to buy it when more conventional markets like stocks are under duress.

Abercrombie & Fitch announces another 60 stores closing as sales continue to slide

Abercrombie & Fitch continues its downward spiral as the overpriced retailer announced sales slid 13% in the all-important holiday quarter. According to this Forbes report, the company will close another 60 stores.

Abercrombie & Fitch (ANF, +16.64%)said on Thursday it is closing 60 more U.S. stores this year as sales at its namesake brand keep collapsing despite a new look for the merchandise and a slick (but ineffective) ad campaign.

These new closings will mean A&F’s fleet will shrink to roughly 670 stores this year from 839 only five years ago. Other retailers to have drastically cut their fleets include Macy’s, (M, +0.61%), Gap (GPS, +3.06%) and J.C. Penney.

The paring of A&F’s footprint comes as its namesake brand reported comparable sales, a measure that excludes failing stores that have been closed in the last year, fell a staggering 13% in the key holiday season quarter. The brand, which is trying to remake itself after facing a consumer backlash over its large logos and sexy ads, blamed a “more promotional activity and a lower gross margin rate than planned” and weak shopper traffic.

These 19 retailers are on the brink of bankruptcy…13,216 stores to close?

Moody’s recently released a Sector In-Depth report titled “Retail and Apparel – US: Distressed Retail and Apparel Companies Are on the Rise. Who’s Next?” and its findings show that the retail bubble could soon be taking another major blow….Bankruptcy.

We all know that retail is a very volatile market. This factor causes many companies to turn to “financial sponsors” and hedge funds that, in return for the quick cash, offer highly leveraged funds causing many retailers to end up struggling under debt with the terms set by the sponsors. Due to these agreements distressed bond issuers in the U.S. retail and apparel markets are nearing levels that haven’t been witnessed since the Great Recession of 2008-2009, tripling in the past six years.

While the clock has been ticking on stores like Sears  and J.Crew for quite some time, 17 other stores appear to have found themselves in the crosshairs of financial doom:

These 19 retailers including Sears and J.Crew, have more than $3.7 billion of debt maturing in the next five years, with about 30% of that total due by the end of 2018. If all of the retailers listed were to shutter their doors that alone would amount to the closing of more than 14,450 stores and leave hundreds of thousands of employees without jobs.

Aside from sponsored ownership, these apparel companies suffer from stressed liquidity, weak quantitative credit profiles, overly discounted merchandise, a decrease in traffic, challenged competitive positions, and erratic management structures. Whether or not any of these companies will be able to reverse the destruction remains to be seen. Based on the growing trend of retail bankruptcy and mall abandonment it seems highly unlikely.

Costco is the #1 organic food retailer in the U.S.

Who would of though? According to this Well and Good report Costco is the number one retailer of organic food, beating out Whole Foods who came in a close second.

Whole Foods may win the prize for the most recognizable retailer when it comes to organic food, but the top honor when it comes to market share actually goes to…Costco.

Yup, the chain best known for its bulk stock and low prices reported $4 billion in organic food sales last year—that’s billion with a B. Whole Foods, by comparison, racked up about $3.6 billion in certified organic sales.

The chain best known for its bulk stock and low prices sold $4 billion worth of certified organic food last year—that’s billion with a B.

And this shift could have a major impact on you (and your healthy habits), even if you’re not a card-carrying member. For one thing, it’s proof that food shoppers across the board are prioritizing organics. And in other exciting news, it shows that it’s possible to sell certified organic produce (COP) at a competitive price—crucial for closing the healthy food gap.

GAP quietly announces hundreds of layoffs at California corporate office

Gap has quietly announced hundreds of layoffs according to this WND report. The company has been streamlining operations as their retail stores continue to be shunned ‘trendy teen’ shoppers.

Gap Inc. said this month it plans to shed 216 workers in San Francisco in a move effective March 31.

The layoffs were reported to the California Employment Development Department earlier this month.

“As part of Gap Inc.’s continued commitment to better position the company for long-term growth, the company has been streamlining its operating model, which has resulted in a small number of job eliminations at the Gap Inc.’s headquarter locations in San Francisco,” a spokeswoman said. “We remain committed to treating employees with respect and support through this period of change, and we intend to make every effort to ensure that impacted employees are considered for any open positions within Gap Inc.”

The cuts come amid a broader pullback by a number of retailers this year that includes store closings among Macy’s, Sears and BCBG Max Azria. That’s in addition to bankruptcies by companies such as The Limited and Wet Seal.

The changing retail landscape was something addressed by Gap Inc. chief executive officer Art Peck in a call with analysts this month, calling out the shifting tides as an opportunity.

Profits fall 43% at Target as consumers dump ‘politically correct’ companies

Target, who continues to marginalize their customers by pandering to the likes of Black Lives Matter and the Transgender movement has announced their worst earnings in years. According to the Chicago Tribune profits have fallen 43%, far below the expectations of Wall Street.

Target, stung by the mass migration by its customers online and elsewhere, said its profit plummeted 43 percent during the most recent quarter as sales at its stores weakened. The coming year doesn’t look much better: Its outlook for the first quarter and all of 2017 were far below what industry analysts had been expecting.

Shares tumbled more than 13 percent to a two-year low Tuesday, and the numbers in Target’s report rattled Wall Street, dragging down Wal-Mart, Macy’s and other retailers.

Retail on Tuesday was the worst performing sector in the Standard & Poor’s 500.

All traditional retailers have struggled as and other online retailers draw shoppers away, but Target has been unable to keep pace with Wal-Mart Stores Inc., which posted another quarter of higher customer traffic and same-store sales. At a meeting with analysts Tuesday, Target CEO Brian Cornell said he hasn’t seen as many troubled retailers since the recession nearly a decade ago.

BCBG prepares for Bankruptcy….Hundreds of stores may close

More bad news for retail as BCBG is heading toward imminent bankruptcy. According to this BOF report, the chain is behind on its rent and ready to close its doors soon if an agreement can’t be worked out.

BCBG Max Azria Group LLC, whose form-fitting party dresses have been worn by celebrities Selena Gomez, Drew Barrymore and others, is making preparations to file for bankruptcy as soon as next week, people familiar with the matter said on Friday.

The fashion house is the latest casualty in the struggling U.S. retail sector, as shoppers abandon malls in favour of internet shopping. BCBG has already informed mall owners of its plans to shutter most of its approximately 200 U.S. stores.

BCBG is working with its financial and legal advisers to prepare the bankruptcy filing, the people said, asking not to be identified because the plans are confidential. It is possible that some companies, including brand licensing firms, may seek to buy BCBG’s assets in bankruptcy, the people added.

BCBG declined comment. Its owner, investment firm Guggenheim Partners, did not respond to requests for comment.

Competing speciality retailers, including The Limited and American Apparel, have also filed for bankruptcy in recent months and are closing down their stores.

In a call with landlords in January, a recording of which was heard by Reuters, BCBG said it preferred an alternative to bankruptcy as it looked to slash its secured debt load of $485 million (389.09 million pounds).

However, BCBG is behind on its rent, and bankruptcy would have the advantage of shielding it from legal action by landlords, which have been put under pressure by a wave of retail bankruptcies and shuttered stores.

The upcoming bankruptcy is a fall from grace for BCBG, an acronym for the French phrase “bon chic, bon genre,” which means good style, good attitude, and originally referred to stylish, well-to-do Parisians. Reuters reported in 2013 that it was exploring a potential sale that could have fetched as much as $1 billion.

Wendy’s to start replacing employees with 1,000 self-ordering kiosks in 2017

Wendy’s, who has been at the forefront of rumors regarding robots (automation) has announced plans to install 1,000 self-ordering kiosks in 2017 according to this Columbus Dispatch report.

Last year, the kiosks were coming. It didn’t take them long to get here.

Wendy’s plans to install self-ordering kiosks in 1,000 of its stores — about 16 percent of its locations — by the end of the year.

The Dublin-based burger giant started offering kiosks last year, and demand for the technology has been high from both customers and franchise owners.

“There is a huge amount of pull from (franchisees) in order to get them,” David Trimm, Wendy’s chief information officer, said last week during the company’s investors’ day.

“With the demand we are seeing … we can absolutely see our way to having 1,000 or more restaurants live with kiosks by the end of the year.”

Trimm said the kiosks accomplish two purposes: They give younger customers an ordering experience that they prefer, and they reduce labor costs.

A typical store would get three kiosks for about $15,000. Trimm estimated the payback on those machines would be less than two years, thanks to labor savings and increased sales. Customers still could order at the counter.

Kiosks are where the industry is headed, but Wendy’s is ahead of the curve, said Darren Tristano, vice president with Technomic, a food-service research and consulting firm.

“They are looking to improve their automation and their labor costs, and this is a good way to do it,” he said. “They are also trying to enhance the customer experience. Younger customers prefer to use a kiosk.”

Barclays bank goes down over the weekend, millions unable to access cash or use credit cards

A server crash on Barclays network Saturday gave many customers an unwanted glimpse into the chaotic future of a cashless, automated society. The crash left many unable to access their funds, unable to use internet or telephone banking and caused many cash machines to go down as a result of hardware failure.

Customers noted that their debit cards were declined even for small purchases like a 17p banana. Many took to social media to express frustration over the inability to withdraw money from in ATMs or be able to pay for purchases in shops and pubs around the world. Some reported being stranded because they could not access funds to buy tickets to return home. Others expressed desperation of not being able to feed themselves or their families.

Panic set in when Barclay’s admitted they had not idea how long it would take to fix the issue, even speculating that it could take until Monday. The bank released a statement saying it was “working to fix” a problem and advised customers to use other banks’ cash machines. It added that telephone banking and in-branch payments were also affected and apologized “for any inconvenience.” Barclays also reiterated the fact that no customer will lose out financially because of the hardware crash and any relevant fees would be reimbursed as soon as possible, another concern that some users called out.

There is still no word how many of Barclay’s 15 million card customers were affected by the outage. There is no doubt this experience echoes the fears and concerns many still have of completely cashless societies. Becoming dependent on cards leaves us vulnerable to situations like this. And the increase of automation results in fewer bank branches where you can go in and manually withdraw money from your account.

Globalists have indoctrinated many of us to believe that electronic currency is more convenient and easier to access than paper currency. But the advantage for cash remains that it is tangible and can be used to trade goods at face value, whereas we see in this scenario that if the value on your debit or credit card cannot be accessed, it doesn’t exist.

The bottom line is even though it is convenient both forms of payment are necessary, and card users should not become overly dependent plastic. We should all be in the habit of carrying some cash on our person at all times to avoid being completely susceptible in situations like this.

Appliance giant hhgregg ready to file bankruptcy after 14 straight quarters of declines

It was only a matter of time before hhgregg disappears.

According to this Bloomberg report, the struggling retailer is on the brink of bankruptcy.

HHGregg Inc., the 61-year-old seller of appliances and electronics, is preparing to file for bankruptcy as it grapples with slumping sales, according to people familiar with the matter.

The filing may come as soon as next month, said the people, who asked not to be identified because the matter isn’t public. The Indianapolis-based company announced last week that it was pursuing a range of strategic and financial options. HHGregg is still seeking an out-of-court solution that would allow it to stave off Chapter 11, one of the people said.

HHGregg, which has lost money the past two fiscal years, would join retailers such as Limited Stores and Wet Seal in seeking bankruptcy protection this year. The brick-and-mortar chains are victims of shifting consumer spending patterns, with more money headed to e-commerce and experiences — rather than traditional shopping centers.

At HHGregg, particularly weak holiday sales have pushed the retailer closer to the edge. Its quarterly revenue for the period ended Dec. 31 plunged 24 percent. In light of the challenges, the company said on Feb. 15 that it hired Stifel, Nicolaus & Co. and Miller Buckfire & Co. to help find ways to improve liquidity and stem the red ink.

Sears quietly announces layoffs at their corporate office…

Sears has quietly announced 130 jobs will be disappearing at their corporate office.

According to the Chicago Tribune, Sears is trying to ‘create a more nimble operating structure.’

It’s only a matter of time before Sears starts to close massive amounts of stores like J.C. Penney

Sears Holdings laid off about 130 corporate employees Thursday, part of a restructuring plan aimed at cutting at least $1 billion in costs this year.

The 130 employees worked in various roles at Sears’ corporate offices, mostly in its Hoffman Estates headquarters, Sears spokesman Chris Brathwaite said.

Sears Chairman and CEO Edward Lampert, in a letter to employees, said the job cuts were needed to “create a more nimble operating structure capable of driving the company’s strategic transformation forward.”

Other steps in the restructuring are still being planned, Lampert said in the letter.

“We need to continue to take action to adapt to the new realities of the retail industry and become more efficient and more competitive over the long term,” Lampert wrote. “This is an important phase in our transformation and all of you will play a role in helping us redefine the way (we) work and as we deliver our best products and services to our Shop Your Way members through the restructuring program.”

Sears declined to say how many employees currently work at its headquarters, but Brathwaite said it remains above the 4,250 employees required by a package of tax breaks Sears received after threatening to leave the state in 2011. At the time, Sears had 6,200 employees at its headquarters.

Family Christian to close all 240 stores after 85 years in business

Family Christian has announced they will closing all 240 retail locations after 85 years in business.

This unfortunate closing will impact 3,000 workers and 36 states according to this Econ Times report.

Family Christian is announcing today it will close its doors – after 85 years in business. Changing consumer behavior and declining sales led the world’s largest retailer of Christian themed merchandise to make the difficult decision to close.  Family Christian is a not-for-profit business that employs more than 3,000 people and operates over 240 retail locations in 36 states, nationwide. Family Christian Ministries has provided humanitarian aid for more than 14 million orphans, widows and oppressed people across the globe.

“We had two very difficult years post-bankruptcy,” said Chuck Bengochea, company President. “Despite improvements in product assortment and the store experience, sales continued to decline.  In addition, we were not able to get the pricing and terms we needed from our vendors to successfully compete in the market. We have prayerfully looked at all possible options, trusting God’s plan for our organization, and the difficult decision to liquidate is our only recourse.”

Alarming trend: Independent restaurants are quietly disappearing across the Unites States

Independent restaurants are quietly closing across the United States. According to this Grub Street report places where people can eat are at there lowest point in 10 years.

The number of restaurants fell by 2 percent nationwide in 2016, according to this report by market-research firm NPD Group, which says this puts the per-capita tally of places where Americans can eat “at its lowest level in the past ten years.” The group did find one segment invulnerable to the recession, at least in terms of sheer numbers, and it’s chains — more specifically, fast-food chains.

The chains (both fast-casual and full-service) grew by one percent in 2016, for a total of 297,351 units. (So almost half the country’s 620,807 restaurants are now chains.) The worst statistic of all is that the closures have not just impacted independently owned restaurants, but disproportionately ones in the full-service, sit-down segment of the industry. Fast-food chains are seeing runaway success — they grew by 7 percent this past year.

Lowe’s lays off hundreds as corporate office gets cleaned out

Lowe’s has laid off over 500 full time corporate employees according to this Charlotte Observer report.

Home improvement retailer Lowe’s has laid off more than 500 full-time corporate employees company-wide in its latest effort to streamline the company and boost profitability.

The layoffs include 430 workers at Lowe’s headquarters in Mooresville, or nearly 11 percent of its workforce there, as well as 70 support staffers in Wilkesboro and about 25 corporate support positions in other facilities across the U.S., the company told the Observer on Tuesday.

The layoffs amount to less than 1 percent of Lowe’s 285,000 employees company-wide. Those who lost jobs will receive severance and outplacement services, the company said.

The latest job changes come about a month after Lowe’s cut about 2,400 full-time positions across its U.S. footprint as part of a rollout of a new store staffing model. The majority of those cuts were at the store level, Lowe’s said, though other affected positions were at distribution centers, contact centers and at the company’s corporate offices.

In October, the retailer also laid off about 95 people in its information technology department.

Even as it makes these cuts, the company is adding other positions. Last week, Lowe’s announced plans to hire 1,700 full-time workers, including 600 in Wilkesboro, to staff its customer-support centers between now and October. With the latest staffing changes, Penhall said, Lowe’s overall employment in North Carolina will remain consistent.

Before the recent layoffs, Lowe’s employed more than 4,000 at its Mooresville offices, about 30 miles north of Charlotte. The company employs another 2,000 in Wilkesboro, a town about 90 miles northwest of Charlotte where Lowe’s was founded in 1946.

CSX railway has announced 1,000 management level layoffs

More bad news for the economy as CSX railway has announced 1,000 management level layoffs according to this Florida Times Report.

CSX will be laying off 1,000 management-level employees, the Jacksonville-based railroad confirmed Tuesday. The same day, the company announced that CEO and Chairman Michael J. Ward and President Clarence W. Gooden are retiring, effective May 31.

The majority of layoffs will come in Jacksonville, company spokesman Gary Sease said, but the exact numbers are not known yet. The company has more than 2,500 management employees in the area.

The impacted employees will be notified next month.

The announcements were just the latest in what’s been a hectic month at the railroad. CSX has been a target of activist investor Paul Hilal’s Mantle Ridge LP, which is backing railroad veteran Hunter Harrison to become CSX’s chief executive.

The company has not commented further on the layoffs nor acknowledged any connected between them and Harrison’s potential arrival. But while Harrison has developed a reputation for turning around three previous railroads – Illinois Central, Canadian National, and Canadian Pacific – they’ve often come with a price. During Harrison’s five years at Canadian Pacific, employment was reduced by more than 6,000, about one-third of its total staff.

Macy’s announces 34 more store closings as profits fizzle

The hits keep coming for Macy’s as the retailer has quietly announced 34 more stores will be closing according to this MSNBC report.

Macy’s reiterated on Tuesday that it will close roughly 100 total stores over the next few years as it works to restore its declining profitability level.

The chain has been struggling to grow earnings as consumers increasingly spend their money at off-price and online competitors.

After outlining 68 of the stores it plans to close last month, the chain said Tuesday morning that it will close roughly 34 additional stores “over the next few years.” It did not provide additional details regarding where those stores would be.

Macy’s braces for another bad year as profits fall 13%

More bad news for Macy’s as the struggling retailer has announced a 13% drop in profits according to this Detroit News report.

Macy’s, the nation’s largest department store chain, says its earnings for the quarter that includes the holiday period dropped nearly 13 percent as results were dragged down by store closures and other costs.

The company has faced sluggish sales for the past two years as customers buy more online and less at the malls where Macy’s is often an anchor. It has been shuttering stores as it tries to regroup.

Macy’s has also been under pressure from shareholders to get more value out of its real estate holdings, valued by activist investor Starboard at nearly $21 billion. The chain has reportedly been in preliminary talks with Hudson’s Bay about a takeover or a real estate deal, though the company made no mention in its earnings report of any discussions. It did say it will be looking to further monetize its locations.

Macy’s earned $475 million, or $1.54 per share, in the three-month period ended Jan. 28. That compares with $544 million, or $1.73 per share, in the year-ago period. Adjusted earnings per share came to $2.02. Analysts had expected $1.95 per share for the quarter, according to FactSet.

Macy’s brand still has around 700 stores, though it has been more aggressive about closings while also scrambling to offer more exclusive merchandise and expand online. It’s also tried launching its own off-price stores called Macy’s Backstage, highlighting consumer tech like smart watches and testing an artificial intelligence tool that would free up sales assistants to provide higher levels of customer service.

Cincinnati-based Macy’s is the first major department store chain to report its fourth-quarter results. Last month, J.C. Penney and Kohl’s both announced poor holiday sales. Ailing Sears Holdings Corp., which operates Sears and Kmart, announced earlier this month that it expects sales at established stores to fall more than 10 percent for the quarter.

HSBC announces an ugly bottom line as profits fall 62%

More bad news for the bankers as HSBC announces a 62% slide in profit according to this MSNBC report.

HSBC Holdings reported a 62 percent slump in annual pre-tax profit that fell way short of analysts’ estimates due to one-time charges related to some businesses, and announced a new $1 billion share buy-back.

Europe’s biggest bank by assets said on Tuesday profit before tax for 2016 fell to $7.1 billion from $18.87 billion in the previous year. That compared with the average analyst estimate of $14.4 billion, according to Thomson Reuters data.

The bank’s Hong Kong-traded shares fell about 3 percent following the release of the results.

The 2016 profit reflected a $3.2 billion impairment of goodwill in its global private banking business in Europe and the impact of its sale of operations in Brazil, the bank said in a statement to the stock exchanges. The private banking impairment charges mainly relate to its acquisition of Safra Republic Holdings in 1999, it said, without giving details.

“We have considered it appropriate to write off the remaining goodwill in the European private banking business,” it said, adding the restructuring of global private banking is now largely complete.

The $1 billion share buy-back takes HSBC’s announced buy-backs since the second half of 2016 to $3.5 billion following the bank’s disposal of its Brazil unit in July last year in a $5.2 billion deal.

“We are investing over $2 billion in digital transformation initiatives to improve our offer to customers, and are instigating a further $1 billion buy-back programme reflecting the strength and flexibility of our balance sheet,” Stuart Gulliver, group chief executive, said in a statement.

Is San Fran’s Rent Dip Enough to Make it Affordable?

If January’s numbers are any indication, it could be a good year for San Francisco renters. According to RENTCafé’s most recent market report, the coastal city is one of only a handful to see a year-over-year dip in rent costs — a surprising feat, since San Fran’s rents hit historic highs over the last decade. But it’s true: rents decreased nearly a full percent from January 2016 to January 2017, down to an average of $3,378 per month.

The drop is likely due to a serious influx of apartment units in 2016, a year that saw the city gain nearly 10,000 new units — 126 percent more than the year prior. One-bedrooms, in particular, saw a decent drop in San Francisco, declining more than 2 percent since January 2016.

Though the slight drop in rents is probably a relief to San Franciscans — as well as those considering a Westward move — it’s still not enough to knock S.F. off the nation’s highest rents list.

In January, San Francisco had the second-highest rents in the country, coming in right behind Manhattan. San Fran’s rent is also about 2.5 times higher than the national average, which was just $1,315 for the month. Since San Francisco is now seeing industry and resident spillover from Silicon Valley, the higher-than-average rents come as no surprise.

Unfortunately, San Francisco’s dropping rents are about the only bright spot on California’s real estate radar, as nearly every major city has seen a recent (and significant) jump in rent. Sacramento, Stockton, Long Beach, Riverside, and Los Angeles all had big rises, with Sacramento’s taking the cake: its rents climbed more than 12.5 percent in just one year.

But don’t let California’s market get you down; in fact, the national apartment market is in a pretty good place. Though the average national rent grew by $5 dollars, it’s not likely the trend will continue. A flood of newly built apartment units should expand inventory and temper rent growth in many of the nation’s biggest cities.

If you’re really looking to save on rent in 2017 though, make the West or South your destination. Tulsa, Oklahoma, and Corpus Christi, Texas, both saw year-over-year drops in rent, and some of the country’s lowest average rents were seen in these regions, too, including Memphis, Tennessee ($718/month); El Paso, Texas ($750/month); Tucson, Arizona ($773/month); and Albuquerque, New Mexico ($814/month). The two most affordable cities were Wichita, Kansas ($626/month) and Toledo, Ohio ($658/month.)

Toys R Us quietly lays off hundreds, $850 million in debt

Toys R Us is on the verge of collapse.

According to this Forbes report hundreds of layoffs have hit their corporate headquarters.

The company is struggling with $850 million in debt, making bankruptcy a possibility in the next few years.

For decades, Toys “R” Us has stood as one of the most reliable and iconic sources of childhood glee. Now, that tradition is on shaky ground. This Friday, the company announced they had laid off between 10-15% of their home office employees out of Wayne, New Jersey — approximately 250 jobs were eliminated.

Amy Von Walter, Toys “R” Us EVP of Global Communication and PR, stated that, ”The recent changes are not just about cost-containment—our growth plans require us to have the right structure, talent and determination to transform our business and achieve the financial objectives we’ve set for the company.”

A long time coming

Toys “R” Us, or TRU, has been struggling financially for some time. In 2005, investors led by KKR & Co., Bain Capital, and Vornando Realty Trust bought out the company for $6.6 billion. In 2016, the business refinanced its remaining $850 million debt load, allowing investors holding bonds maturing in 2017 and 2018 to swap their holdings for those maturing in 2021.

Multiple factors are contributing to Toys R Us’ problems. Like other retailers, TRU has struggled to find new ways of operating as consumers shift to more online buying. People simply aren’t trekking to the malls that previously helped the toy chain dominate. Plus, savvy competitors like Walmart and Target have tripled their toy aisles & seasonal offerings during holiday season, allowing customers to cross TRU off the store list.

Amazon also cuts into sales as a major competitor, but it’s particularly painful as Toys R Us has historically had trouble getting products to customers. In 2015, they ran out of on-site goods which prompted TRU to try a new inventory algorithm, but ecommerce fulfillment issues were created as they underestimated holiday volume. Since the buyout ten years ago, the company has also been managed by no fewer than four CEOs:

Nordstrom’s in big trouble as full-line stores report fifth straight quarter of declines

It was only a matter of time before the holy grail of retail, Nordstrom’s felt the pinch of the consumer pullback.

According to this Houston Chronicle report Nordstrom’s full-line stores, usually the anchor store at your mall has recorded its fifth straight quarters of year-over-year declines.

For many years, Nordstrom has been regarded as a poster child for how traditional retailers should respond to the rise of e-commerce.

But, as the past year has shown, even Nordstrom isn’t immune from the larger forces rocking brick-and-mortar retailers these days, with department stores hit particularly hard.

While Nordstrom’s total sales have risen over the past year, its profits have not.

And perhaps most worryingly, sales at the company’s full-line stores — the big downtown or mall anchor operations that bring the bulk of Nordstrom’s business and have shaped its reputation for stellar customer service — have logged five straight quarters of year-over-year declines.

Whether that extends into a sixth quarter, including the all-important holiday shopping season, will be revealed Thursday when Seattle-based Nordstrom reports its fourth-quarter and year-end results.

For the latest nine months reported, Nordstrom saw its profit fall nearly 64 percent, to $153 million.

There are several reasons for the gulf between top-line and bottom-line results during those months.

The company’s $197 million write-down last quarter for its $350 million purchase of online retailer Trunk Club in 2014 was a hit to its bottom line. Without that write-down, Nordstrom would have logged a profit, rather than loss, that quarter.

Higher markdowns on items to reduce inventory also ate into profits.

Store openings — Nordstrom opened 26 new stores, including three full-line stores and 23 Nordstrom Rack off-price stores — undoubtedly boosted overall sales. But more stores meant more operating expenses.

And “Nordstrom’s full line stores are expensive to open and operate, and they take time to get up to speed and make a full contribution to the bottom line,” said Neil Saunders, managing director of retail for research firm GlobalData.

Meanwhile, the soaring, mostly double-digit growth in sales at Nordstrom’s online sites has cost the company. Revenue from, and flash-site sale HauteLook represented a fifth of Nordstrom’s overall sales, Mike Koppel, the company’s chief financial officer, said early last year. That was up from 8 percent five years ago.

But building out that e-commerce infrastructure, and factoring in the online business model, which has a “high variable cost structure driven by fulfillment and marketing costs,” has meant that “expenses in recent years have grown faster than sales,” Koppel said.

Deriving one-fifth of its sales from e-commerce is good, said Stern of McMillanDoolittle. But growing e-commerce with great customer service — such as with free shipping and free returns — “it costs you,” Stern said.

“Those sales today are not as profitable as brick-and-mortar sales. That’s the trap Nordstrom is in right now.”

To curb some of those expenses, Nordstrom cut up to 400 positions last year, representing about 6 percent of its workforce, and laid off 120 tech staffers. Last spring, executives also said they were looking at more cuts in the company’s already-trimmed $4 billion, five-year capital-expenditure plan.

But it still will have sizable capital expenditures in the coming years, not least for the 363,000-square-foot flagship store it’s building in Manhattan, which is expected to open in 2019. Nordstrom has not said how much it’s spending on that flagship, but its five-year capital plan included an estimated total of $1.1 billion for both the Manhattan store and its recent expansion into Canada.

Nordstrom also faces a formidable competitor in hometown neighbor Amazon, which is already the country’s biggest seller of clothes online and is likely to overtake Macy’s this year as the nation’s overall biggest seller of apparel, according to Cowen and Company.

Amazon, with its one-hour delivery and other innovations, is “erasing by the minute” whatever advantages physical stores might claim, such as the immediate gratification of being able to buy something to take home, said Stern.

Perhaps most troubling for Nordstrom is that its full-line U.S. stores have seen comparable sales declines each quarter since the one that ended in October 2015.

Lidl plans to open 600 U.S. grocery stores

Finally, some innovation is coming to the boring and overpriced world of grocery. Lidl, a German chain that operates 10,000 stores in 27 countries has set its eyes on America.

According to this Business Insider report, the company will be opening 20 stores along the East Coast this summer, with plans to expand to 600.

A highly competitive European grocery chain is about to descend on the US.

The German supermarket chain Lidl is gearing up to open 100 stores along the East Coast by mid-2018, with the first 20 stores opening this summer in Virginia, North Carolina, and South Carolina.

The chain plans to eventually open as many as 600 stores in the US, according to a copy of a company presentation obtained by Business Insider. Lidl currently has 10,000 stores in 27 European countries.

In the presentation, Lidl describes itself as a cross between Trader Joe’s and Harris Teeter, a grocery chain based in North Carolina.

Overseas, Lidl is known for its rock-bottom prices, and it’s most closely associated with the discount grocer Aldi, which is also based in Germany.

But it appears Lidl is trying to set itself apart from Aldi in the US.

“After three years of research, we discovered that US consumers don’t like discount groceries,” the presentation says. “Unlike Aldi, the Lidl will be a hybrid similar to Trader Joe’s or Harris Teeter, but closer to a Trader Joe’s. We will sell high-end brands, quality not quantity, best products only.”

The chain’s US headquarters are in Arlington, Virginia, and it’s building warehouses in Cecil County, Maryland; Mebane, North Carolina; and Fredericksburg, Virginia.

Outback Steakhouse to close 43 Restaurants, company reports $4.3 Million loss

Casual dining takes another hit as Bloomin Brands, the parent company of Outback Steakhouse has announced the closing of 43 restaurants according to this CBS report.

After a decline in sales, Bloomin’ brands – parent company of Outback Steakhouse – announced Friday they will be closing 43 restaurants.

Reported earnings show a loss of $4.3 million late last year. In 2015, the company brought in a net income of $17.7 million. The dining industry has been facing some financial challenges, because more customers are opting for takeout and delivery options.

According to Bloomin Brands press release:

“Although 2016 was a challenging year for both Bloomin’ Brands and the industry, we made real progress on our strategy to reallocate spending away from discounting toward investments to strengthen brand health, ” said Liz Smith, CEO. “We are pleased with how our brands are performing so far in 2017, particularly at Outback where we believe our investments are beginning to gain traction.”

On February 15, 2017, we decided to close 43 underperforming restaurants. In connection with these closures, we recognized pre-tax asset impairments of $46.5 million during Q4 2016, which includes three restaurants that closed in the fourth quarter. We expect to incur charges between $16 million to $19 million in fiscal year 2017 with the majority of these expenses occurring in the first quarter.

These 11 Retailers are on the brink of Bankruptcy

More bad news for retail as these 11 companies are on the verge of Bankruptcy according to this Money report.

Claire’s Stores: Known mostly as an accessory and apparel store for teens, struggling and closing stores for years, and engaged in debt restructuring talks over the course of several months last summer.

David’s Bridal: The company’s CEO resigned last summer, and Moody’s shifted David’s Bridal’s outlook from stable to negative in September.

Fairway: The supermarket chain went public in 2013 and has expanded rapidly in recent years. But it has also struggled with debt, and filed for chapter 11 bankruptcy protection last spring. The company exited from bankruptcy a couple of months later, but apparently is not fully in the clear.

Gymboree: “The Gymboree Corporation’s high price perception has caused consumers to look elsewhere for children’s apparel,” a Fitch Ratings report declared a year ago. In November, the children’s apparel retailer was downgraded by Moody’s.

J. Crew: The preppy retailer has been in a slump for several years, and ended 2016 amid talks to restructure its $2 billion debt. The brand’s “high price perception, coupled with fashion misses, has created sharp traffic declines and aggressive markdowns necessary to clear excess inventory,” a Fitch Ratings report said of J. Crew.

Nine West: Moody’s analysts have described the debt level of this women’s shoes and handbags retailer as “unsustainable.”

Payless: The discount shoe seller engaged in negotiations recently to close 1,000 stores in a plan to restructure its enormous debt.

Sears: The department store company announced it would be closing over 100 Kmart and Sears stores in 2017, on top of 78 closures last summer.

TOMS Shoes: One of the first true socially conscious clothing lines to emerge last decade, Toms was downgraded by Moody’s last summer.

True Religion: The (once) trendy apparel retailer was forced to explore debt restructuring options last fall.

Boycott backfire: Wegmans stores sell out of Trump wine

The left likes to ruin everything, even a good glass of wine. Their latest failed attempt came when they demanded Wegmans stop carrying Trump wines. Laughably, the failed attempt caused the wine to sell out according to this Syracuse report.

Wegmans doubled down on their position stating we “would continue to stock products based on how well they sell, not politics.”

Finally a company with some balls…

Did a threat to boycott Wegmans over products with President Donald Trump’s name backfire?

The Rochester-based grocery store chain came under fire this week for carrying Trump wines at its 10 Virginia locations. The bottles come from the Trump Winery in Charlottesville, Va., bought by Trump in 2011 and given to his son, Eric Trump.

The National Organization for Women and other critics encouraged shoppers to take their business elsewhere, despite Wegmans’ cult following and positive reputation. “Let’s demonstrate through economic action that the residents and businesses of Charlottesville will not stand for the hatred espoused by Eric Trump and those like him,” the protest group Stop Trump Wine said.

However, the attention may have encouraged Trump supporters to buy more of the wines.

“As of late yesterday, we had sold out many varieties in our (Virginia) stores, and in some cases, all varieties,” Jo Natale, vice president of media relations for Wegmans, told the Democrat & Chronicle Friday. “For example, our two Richmond stores had completely sold out. Other stores had inventory of some varieties.”

A liquor store owner in Henrietta, N.Y., told the newspaper that he was also seeing increased demand: “Some people, sight-unseen, would just buy bottles of it.”

hhgregg is the next retailer to announce store closings…

This one is long overdue, hhgregg has finally realized they need to make some drastic changes according to this Dispatch report. Unfortunately, this involves closing stores…something they haven’t come to terms with yet.

Struggling appliance and electronics retailer hhgregg, unable to turn its fortunes around on its own, has brought in outside advisers to help it return to profitability.

The Indianapolis-based company has engaged financial adviser Stifel, Nicolaus & Co. and investment banker Miller Buckfire & Co. to pursue “a range of potential strategic and financial transactions,” the company said.

“We are committed to improving our results through our business strategy, including investments made to shift our focus to appliances and furniture, and additional expected cost reductions,” Robert J. Riesbeck, president and CEO, said in a statement. “We believe it is an appropriate time to explore potential strategic transactions.”

An hhgregg spokeswoman added in an email: “We are focused on improving the overall business results, and remain fully committed to serving our customers’ needs.”

Founded in 1955, hhgregg has 220 stores in 19 states. In central Ohio, the retailer has locations in the Dublin area, Easton, Grove City, Hilliard, Reynoldsburg, Heath and Chillicothe.

The company’s turnaround strategy could include closing some stores in central Ohio, said local retail analyst Chris Boring.

“They built the company to support a much higher level of sales, so they’ll have to do something,” Boring said. “They have to find a way to reduce costs. They’re going to have to look at lease expiration on a store-by-store basis and see which ones make sense to close.”

Shutting down the whole company is unlikely, at least for now, Boring said.

“I still see value there,” he said. “It could make a strategic fit with another retail chain. They’re still a major player in the appliance category. That’s one of the few retail categories that hasn’t been affected by online sales. Not many people will order a washer online.

“But they’re going to have to get out of consumer electronics. That’s where online has really made an impact.”

The company has struggled for years in the highly competitive electronics retail market and suffered a poor holiday sales season. In its most recent quarterly earnings report, hhgregg reported that sales decreased to $453 million from $593.2 million the same quarter the year before, badly missing the expectations of Wall Street analysts, who predicted $564 million in sales. Comparable store sales, a key indicator of a retailer’s health, plummeted by 22.2 percent.

Solar skyrockets 95% in 2016…

Solar continues to skyrocket in the U.S. According to this GTM report the market grew 95% in 2016 and shows no signs of letting up.

In its biggest year to date, the United States solar market nearly doubled its annual record, topping out at 14,626 megawatts of solar PV installed in 2016.

This represents a 95 percent increase over the previous record of 7,493 megawatts installed in 2015. GTM Research and the Solar Energy Industries Association (SEIA) previewed this data in advance of their upcoming U.S. Solar Market Insight report, set to be released on March 9.

For the first time ever, U.S. solar ranked as the No. 1 source of new electric generating capacity additions on an annual basis. In total, solar accounted for 39 percent of new capacity additions across all fuel types in 2016.

“What these numbers tell you is that the solar industry is a force to be reckoned with,” said Abigail Ross Hopper, SEIA’s president and CEO. “Solar’s economically winning hand is generating strong growth across all market segments nationwide, leading to more than 260,000 Americans now employed in solar.”

Success this year was driven largely by the utility-scale segment, which was bolstered by a pipeline of projects initially hedging against the extension of the federal Investment Tax Credit. Not only did it represent the most megawatts installed, but the utility-scale segment also featured the highest growth rate of any segment, growing 145 percent from 2015.

“In a banner year for U.S. solar, a record 22 states each added more than 100 megawatts,” said Cory Honeyman, GTM Research’s associate director of U.S. solar. “While U.S. solar grew across all segments, what stands out is the double-digit-gigawatt boom in utility-scale solar, primarily due to solar’s cost-competitiveness with natural-gas alternatives.”

Credit card debt tops $1 trillion, most since the great recession

Credit is king as Americans finance their way to disaster. According to this CNBC report, credit card debt has topped $1 trillion, the most since the great recession.

With consumers feeling better about the economy, the amount of money borrowed on plastic has reached a high not seen since the Great Recession.

Outstanding credit card debt topped $1 trillion at the end of 2016, according to The Nilson Report, a card and mobile payment trade publication.

While household income has grown over the past decade, it has failed to keep up with the increased cost of living over the same period.

To bridge the gap, more Americans rely on credit cards, one of the most expensive ways to borrow. The average credit card interest rate is 19.36 percent and the average household pays a total of $1,332.80 in credit card interest each year, according to a separate report by NerdWallet.

MC Sports announces all 66 stores will be closing

The consolidation continues as Midwest staple MC Sports has announced they will be closing all 66 stores according to this Cleveland report.

MC Sports announced this morning that it plans to close all 66 of its stores across the Midwest.

A joint venture between Tiger Capital Group and Great American Group will conduct the going-out-of-business sale, which is now under way.

Founded in Grand Rapids in 1946, MC Sports was one of the few remaining privately held sporting goods chains in the country. It filed for Chapter 11 bankruptcy protection on Feb. 14 in the U.S. Bankruptcy Court Western District of Michigan, Grand Rapids.

The company currently operates 24 stores in Michigan; 11 in Ohio including stores in Chardon, Wooster and Medina; seven in Indiana; eight in Illinois; seven in Wisconsin; five in Missouri, and four in Iowa. To see a list of locations, click here.

“Across the Midwest, MC Sports became a fabric of the community,” stated Scott K. Carpenter, President of GA Retail Solutions, a leading provider of asset disposition and auction solutions, and a subsidiary of B. Riley Financial, Inc.

MC Sports’ large-format stores carry sporting goods and apparel in many categories — from hunting, fishing and camping equipment, to running shoes, kayaks, treadmills, workout clothes, and team sports equipment.

During the liquidation event, shoppers will find discounts of up to 60 percent off the original prices on dozens of top brands with some exceptions, most notably firearms.

Greek bank runs start again….$3.2 billion withdrawn since the start of the year

With capital controls already in place Greece has managed to create another bank run. According to DW $3.2 Billion has been withdrawn since the first of they year.

Greek citizens had withdrawn close to 3 billion euros ($3.2 billion) since the beginning of the year, the Union of Greek Banks reported Friday.

The English-language news blog “keeptalkinggreece” spoke of a new bank run limited only by the capital controls currently in place. It noted that delays in the talks between Greece and its lenders had brought back the ghost of Grexit,” referring to the southern European nation’s possible exit from the eurozone.

The website said 2.5 billion euros had been withdrawn from private bank accounts over the past 45 days alone, “and this despite capital controls that allow Greeks to withdraw a maximum of just 1,800 euros per month.

GNC to close 100 stores, reports $433 million fourth-quarter loss

GNC, who has now rebranded themselves as a health and wellness retailer has reported a $433 million dollar fourth quarter loss according to this Pittsburgh Post report.

The bad news doesn’t end there as GNC reported a 64% decline in sales and the closing of 100 stores.

GNC officials on Thursday took pains to distance the company from the “old” GNC after reporting a $433.4 million fourth-quarter loss, marking the end of a dismal 2016 that saw a 64 percent decline in the Pittsburgh health supplement retailer’s share price.

For the year, GNC Holdings Inc. recorded a net loss of $286.3 million, compared with a $219.3 million profit the year before, as sales declined 6.5 percent and 6.8 percent respectively in company-owned and franchise stores. GNC’s consolidated revenue of $2.54 billion was a 5.3 percent drop from 2015’s $2.68 billion. Its adjusted earnings per share was 7 cents, far off Wall Street’s estimate of 36 cents per share.

“This is certainly not what any one of us wanted to see,” said interim CEO Robert Moran of GNC’s fourth-quarter performance during the company’s quarterly financial briefing to analysts.

The losses, said Chief Financial Officer Tricia Toliver, “are not a good indication of where the business is headed,” adding later that, “We are building an entirely new business model.”

Ms. Toliver was referring to the “One New GNC” campaign, launched Dec. 29 to rebrand the health and wellness retailer. The “new” GNC now features simplified pricing, reduced prices on about half of its products, and a free customer loyalty program, with plans to offer new proprietary products.

Mr. Moran said company officials are encouraged by the campaign’s early results, with sales transactions up 7 percent among company-owned stores and an even more promising performance among the GNC stores that have been piloting the program.

It undoubtedly can’t come soon enough for investors who, shortly after the GNC financials were released early Thursday, learned the GNC board was suspending the company’s quarterly dividend. Shares briefly fell below $7 for the first time since the company went public in 2011.

The stock closed at $7.72 Thursday, down 7.21 percent.

Ms. Toliver said the fourth quarter had notable one-time expenses such as a $10 million investment to clear inventory and launch the One New GNC campaign. As part of its preparation, GNC closed all of its stores for the day on Dec. 28, which also cut into sales. She also said the company expects to close about 100 stores this year as leases expire.

China’s Economy on Paper

In a series of published reports, China has given the world the impression that its economy has been prospering. However, this may not be entirely accurate.

According to data, it seems that less money is being circulated outside China over the past 12 months.

China bought government bonds from the U.S. in the last quarter of 2016. However, overall holdings fell by about $190 billion last year. FOREX reserves may have decreased at a slower rate in January but they fell below $3 trillion in 2016.

“The faster we get to $2.5 trillion, the quicker the sense of eventual disarray will be,” said Junheng Li, the Founder of equity research firm JL Warren Capital. “Additional tightening of capital controls is likely. However, we are starting to see restrictions imposed on areas with increasing marginal cost. Therefore, one needs to wonder if they will be able to slow down much further the pace of outflows.”

Li estimates that around $70 billion circulates outside China each month.

This isn’t the first time that China has presented contradictory reports. Despite reports of growth, FXCM reported that some experts have voiced their concerns about China manipulating its government data. The report went onto state that even Li Keqiang, current Premier of the State Council of the People’s Republic of China, was skeptical whether some of the data presented by the country was accurate. In 2007, The Premier said that China’s GDP was “man made” and was therefore not dependable for analytical use. He said that the GDP figures were “for reference only”.

Recently, China’s capital Beijing tightened the control on individuals taking money outside the country. As a result, Chinese investors seem to being show less interest in buying assets in USD.

However, the Yuan could be in trouble again as the U.S. Federal Reserve moves to keep interest rates high this year could strengthen the dollar. According to speculation, this year could end with interest rates twice as high as they were when the stimulus package was still in place in the U.S.

“As long as the U.S. is in a tightening environment, we’ll likely see capital outflows” stated Francis Cheung, Head of China-Hong Kong strategy, a brokerage and investment firm based in Hong Kong.

If the USD’s strength declines, experts say it will probably be because of Trump’s unpredictability that directly affects the economy. However, the main factor that keeps the USD strong is the Federal Reserve’s high interest rates so investors are positive that the currency will stay strong despite minor fluctuations.

Will Venezuelan’s resort to Cannibalism if they can’t find food?

(THOMAS DISHAW)  Sounds crazy, doesn’t it? But if things don’t change Venezuelans may resort to cannibalism in an effort to survive.

It is no secret that Venezuela is a desperate, starving nation. Children are passing out in classrooms. Newborns are dying from malnutrition and parents are giving away their kids all due to hunger.

The average minimum wage in Venezuela is $13.50 a month in USD, while the average cost for a fast food combo meal is $30.00 in USD. The Military controls the food supply leaving grocery shelves mostly empty, and basic staples are in short supply. Armed troops persuade business owners to give 80% discounts to “stimulate” the economy.

Inflation has skyrocketed to 800% putting basic goods out of reach for most people. The country took another major hit when the oppressive Maduro regime banned its biggest bill, the 100-bolivar, worth only .03 cents USD. Venezuela is a poor example of socialism but an excellent example of a dictatorship. Just for the record, I’m a fan of neither.

With all of these hardships mounting against suffering Venezuelans, some speculate that cannibalism may ensue as a way to fight starvation.

North Koreans experienced similar economic strife, and reports of cannibalism began to surface. In an article published by the Express, “Fears of cannibalism in the country surfaced in 2003, amid testimony from refugees who claimed poor harvests and food aid sanctions had resulted in children being killed and corpses cut up for food.”

Last year it was reported that desperate Venezuelans were breaking into Zoo’s to kill and eat the animals due to starvation. There have also been cases of people eating endangered animals like Flamingos and anteaters for the same purpose. When all the animals are eaten, the next logical step would be for cannibalism to start taking place. As Dave Hodges puts it “humans historically have preyed upon each other when there is no food left to procure.”

Big layoffs coming for Disney’s Maker studios…

The cost cutting crusade continues at Disney as Maker studios is on the chopping block according to this Variety report.

Maker Studios is gearing up for some major cutbacks in personnel as Disney looks streamline its digital-video division to operate more efficiently — and produce bigger, more bankable digital stars, Variety has confirmed.

Reps for Maker and Disney did not respond to requests for comment.

It’s not clear how sizable the layoffs will be, but according to an industry source familiar with Maker one of the key factors is that it is now integrated into the Disney Consumer Products and Interactive Media (DCPI) group, which is overseen by Jimmy Pitaro. “They don’t have a need for the entire team,” the source said. Maker is “not a self-contained unit anymore.”

Maker — which has touted its network as once encompassing some 60,000 individual creators — will be focusing its efforts around the most popular talent. Top creators in the Maker network include Bratayley, CaptainSparklez, Cartoonium, Epic Rap Battles of History, EvanTubeHD, Game Grumps, HobbyKidsTV, Shay Carl, Strawburry17, the Gregory Brothers and Timothy DeLaGhetto.

Disney bought Culver City, Calif.-based Maker Studios in 2014, ultimately paying $675 million (less than the $950 million maximum potential price tag). Last summer, Maker laid off about 30 employees in what it called a “strategic adjustment” of resources.

Toshiba facing bankruptcy after $6.2 Billion dollar bet on nuclear power

According to this Extreme Tech report, Toshiba is on the verge of Bankruptcy after announcing the company would take a $6.2 billion dollar write-down on the value of its nuclear plant business.

We’ve known for weeks that Toshiba was in rough shape and seeking to raise additional revenue through a potential partial sale to Western Digital, but events on Tuesday pushed the company’s position from “really bad” to “implosion imminent.”

Today, Toshiba announced that it would take a $6.2 billion write-down on the value of its nuclear plant construction business. Toshiba acquired a majority stake in Westinghouse Electric Company in 2006, and later upped its share of the company to 87% in 2013. Toshiba paid $5.4 billion for the company in 2006 and an additional $1.6 billion in 2013. In 2015, Toshiba declared its nuclear business was more profitable now than when the company acquired it, but scandals over the Japanese firm’s accounting broke soon thereafter.

Westinghouse is far from the only nuclear engineering firm that Toshiba owns, but it’s near the heart of this scandal. In 2015, Westinghouse bought an American construction company, CB&I Stone & Webster. Toshiba now says that Westinghouse overpaid for the company and that information material to the acquisition — specifically cost overruns, delays, and the impact both would have on CB&I Stone & Webster’s bottom line — were not disclosed properly or accounted for.

Toshiba also announced today that it would take a $3.4 billion loss (estimated) due to cost overruns at multiple key nuclear projects, and that it would review all of its agreements with existing power companies to expand nuclear capability across the globe. Toshiba plans to pivot towards emphasizing existing service contracts as opposed to bidding on nuclear plant construction projects, though it does still hope to sell some of its AP1000 reactors. The AP1000 is a pressurized water reactor, and the latest design from Westinghouse has deployments scheduled to come online this year in Sanmen, China. This deployment is running 2-3 years late, which may be part of why Toshiba is taking such heavy losses.

Walmart buys Michigan-based Moosejaw for $51 million in cash

Outdoor recreation and apparel company Moosejaw has just been gobbled up by Walmart for $51 million according to this Free Press report. Hopefully, the mass retailer doesn’t destroy the Michigan-based company.

Wal-Mart is buying Moosejaw — a Madison Heights-based company that specializes in outdoor recreation apparel and gear and is known for its quirky, cutting-edge marketing — in a bid to strengthen the global retail juggernaut’s online offerings for $51 million in cash, the companies announced today.

Wal-Mart said it will continue to operate the Moosejaw website as a standalone site and  its10 stores as separate retail outlets. Its 350 employees will remain in Michigan.

“From the customer’s perspective they really won’t see much change in or our stores,” Eoin Comerford, Moosejaw’s CEO, told the Free Press. “We are going to continue to be an outdoor specialty retailer of premium brands. You are going to have the same Moosejaw voice and the same Moosejaw Madness is going to be very prevalent.”

Iconic retailer MC Sports has declared Bankruptcy, 68 stores to liquidate

Michigan staple MC Sports has filed for bankruptcy. According to WOOD TV, the company will begin liquidating all 68 stores.

After 70 years as a West Michigan retail staple, MC Sports has declared bankruptcy.

MC opened in Grand Rapids in 1946, selling World War II surplus in addition to fishing, hunting and outdoor sporting goods. It would grow to include more than 70 stores in seven states throughout the Midwest.

But that legacy is in jeopardy.

For decades, MC was the big retailer in many communities, but the advent of online shopping and the arrival of megastores like Dick’s and Cabela’s took its toll on the company. Over the last four years, the company has changed its approach with some smaller stores and began closing some of its underperforming outlets — including the store at Rogers Plaza in Wyoming more than a year ago.

But according to its filing in U.S. Bankruptcy Court, weak holiday sales last year resulted in even more financial distress for the company.

MC currently has more than $170 million in annual revenues and employs more than 1,300 people.

But in 2016, the company operated at a $5.4 million loss, according to the filing. The company states it has $3.8 million in trade debt to Nike, $2.4 million to Under Armour and almost a half-million dollars to Wilson. The company also owes its employees $150,000 in matching funds to company-provided 401k plans.

In the filing, President and CEO Bruce Ullery says the company was unable to reach an out-of-court settlement with its creditors.

The company says it will have liquidation sales at all 68 of its stores and specifically lists seven stores outside Michigan that are being closed.

Titan Machinery to close 15 stores…

Titan Machinery, a company that supplies construction and agricultural equipment has announced the closing of 15 stores according to this Tribune report.

Fifteen stores in a network of agriculture and construction equipment dealers headquartered here will soon close, including one in Redwood Falls..

Titan Machinery Inc. announced the upcoming closures on Thursday, Feb. 9, that will happen March 31 as part of a dealership restructuring. It includes stores in Redwood Falls and Thief River Falls in Minnesota and Arthur, Kintyre, Kulm and Mayville in North Dakota.

The company will also close two stores each in South Dakota, Nebraska and Iowa, as well as two stores in unspecified locations where Titan already has another store in the same community. Titan also closed a construction equipment store in Williston, N.D., last December.

Chief Marketing Officer Jeff Bowman said the company has made “very aggressive” changes in recent years in reaction to lower commodity and agriculture prices, including a big reduction in its used equipment inventory.

But this newly announced restructuring isn’t another reaction to those trends, he said. Instead, it’s a way for the company to make strategic decisions about how to maximize efficiency and improve customer service in the years to come, he said.

“Where the industry has gone has been a wakeup call for all of us, and it’s really caused us to be more diligent about, ‘OK, where is this going, and what do we need to do next?'” he said.

Credit Suisse announces 6,500 layoffs after reporting $2.35 billion dollar loss

More bad news for the bankers as Zero Hedge reports Credit Suisse will be cutting 6,5000 jobs after reporting a 2.35 billion dollar loss.

After Credit Suisse reported yet another significant loss for the full year 2016, amounting to 2.35 billion Swiss francs, more than the CHF2.07bn expected, the Swiss banking giant said it was looking to lay off up to 6,500 workers and said it was examining alternatives to a planned stock market listing of its Swiss business.

“We’re setting a target now of between 5,500 and 6,500 for 2017,” Chief Financial Officer David Mathers said in a call with analysts on Tuesday after the bank published earnings. The bank did not specify where the extra cuts would come but said this would include contractors, consultants and staff, Reuters reported.

For the fourth quarter, Credit Suisse reported a 2.35 billion franc net loss, largely on the back of a roughly $2 billion charge to settle U.S. claims the bank misled investors in the sale of residential mortgage-backed securities.  Despite the loss, Credit Suisse proposed an unchanged dividend of 0.70 francs per share, in line with market expectations.

CEO Tidjane Thiam, who took over at Switzerland’s second biggest bank just over 18 months ago, is shifting the group more toward wealth management and putting less emphasis on investment banking. As part of his turnaround plans, the bank is looking to cut billions of dollars in costs and cut a net 7,250 jobs in 2016 with more to follow this year.

Additionally, Credit Suisse said it was still preparing sell 20-30% of its Swiss business in an initial public offering but left the door open to alternative options to strengthen its balance sheet. It said a flotation depended on market conditions and board approval. “So we will continue as planned our preparations for an IPO in the second half of ’17,” Thiam told analysts on the call. “That said, we will also continue to analyze the evolution of our regulatory environment which is key in this and, as we always do, continuously examine a broad range of options to determine if there are ways to reach a more attractive risk/reward outcome for our shareholders.”

Aside from the “one-time charge”, the bank’s other results showed a modest improvement. “Capital ratios were much better than expected. On a divisional level, results in IWM (International Wealth Management) and IBCM (Investment banking and Capital Markets) were better than expected,” Vontobel analyst Andreas Venditti, who has a “hold” rating on the stock, wrote in a note.

Still, just like Deutsche Bank, in wealth management, Credit Suisse said it suffered net outflows in the fourth quarter due to clients pulling cash to participate in tax amnesty programs and a decision to drop certain external asset managers. Offsetting that, however, the bank said all its wealth management divisions had seen positive inflows year to date. At the end of the fourth quarter, Credit Suisse’s common equity Tier 1 capital ratio, an important measure of balance sheet strength, was 11.6 percent, down from 12 percent in the third quarter but ahead of market expectations.

The bank’s shareholders greeted the news of fresh layoffs, sending the stock 3% higher in early trading.

My Fit Foods abruptly announces the closing of all stores nationwide

Another company bites the dust. According to this Biz Journal report My Fit Foods is closing all stores nationwide.

My Fit Foods, an Austin healthy prepared meals company that had seen some setbacks while rolling out locations in other cities and battling another local competitor for market share, has closed all of its locations.

In tersely worded notice on the company’s website posted over the weekend, the company thanked its customers. “Since 2006 My Fit Foods has been on a mission to make healthy eating easy and accessible for everyone… it is with a heavy heart that we announce the closure of all our stores,” the notice said.

The company had more than 50 locations in five states, and had opened a 30,000-square-foot central kitchen in 2015 in Fort Worth, Texas, to prepare meals daily for its 38 Texas and Oklahoma locations.

My Fit Foods, founded in 2006, moved its corporate headquarters from Houston to Austin in 2013 to 5000 Plaza on the Lake near the Pennybacker Bridge on Loop 360. The company was led by CEO David Goronkin, who came in after founder Mario Mendias was arrested in 2015 and charged with possession of a controlled substance after a disturbance at a downtown Austin hotel.

KPRC-TV reported that all employees were let go Sunday without warning. The TV station said its crews visited several My Fit Foods locations Sunday evening and all were closed with a sign announcing the closure on the front door.

Royal Bank of Scotland to cut 15,000 jobs?

According to this Telegraph report, the Royal Bank of Scotland is vehemently denying rumors that a massive job cut of 15,000 workers is on the horizon….For some reason I don’t believe them.

Royal Bank of Scotland is preparing to cut more costs and chop more workers, but played down reports it will cut 15,000 staff in the next round of shrinking.

The troubled bank is expected to report losses of £2.3bn for 2016 when it publishes its financial results later this month, its ninth consecutive year in the red.

A spokesman said “we do not recognise” the 15,000 job cuts number which was reported in the Sunday Times.

The bank is expected to continue its strategy of slimming down, but the spokesman declined to put a figure on expected job cuts.

RBS has lost well over £50bn since the financial crisis struck and it was bailed out in 2008, and bosses are under pressure to take more costs out of the business.

It has already pulled back from many international operations and cut down its investment bank, slashing the number of employees from a peak of 226,400 in 2007 to just 82,500 late last year.

It cut around 10,000 staff in 2016 and cutting another 15,000 rapidly may prove difficult.

Noodles & Company to close 55 stores, company announces six consecutive quarters of decline

As consumers continue to vote with their dollars, and make healthier choices we will see more news like this. Noodles and Company has announced the closing of 55 underperforming locations according to this QSR report.

Noodles & Company announced that it will close 55 of its 510 restaurants as it looks to turn around sliding sales. The fast casual is revamping its menu and shuttering “underperforming” locations “to eliminate the negative cash flow of these restaurants and improve overall performance.”

The company did not say where the more than 10 percent cut will take place, only that the closures will happen in the first and second quarters.

Noodles & Company added in the statement that many of the locations were opened in the last two to three years in newer markets where the brand’s performance isn’t as strong. Overall, the company reported a system-wide decrease in comparable restaurant sales of 1.3 percent for the partial fourth quarter, including a 1.8 percent drop at company-owned stores, and a 2 percent increase at franchised locations.

This continues a troubling trend for Noodles & Company, which has reported six consecutive quarters of year-over-year declines at locations open at least a year. And last June, the brand reported a security breach that comprised customers who used debit or credit cards between January 31 and June 2.

Iconic retailer Gander Mountain headed for Bankruptcy…160 stores closing?

More bad news for retail as iconic outdoors store Gander Mountain is headed for bankruptcy. According to this Star Report, the company may be on the verge of closing all 160 U.S. stores.

Gander Mountain, the outdoor retailer based in St. Paul, is said to be preparing for bankruptcy, according to sources cited by the Reuters news agency.

No specifics have been confirmed. Company spokesman Jess Myers said Saturday that the company had no statement to offer. “They’ve taken a vow of silence,” he said.

The privately held company is owned by David Pratt and the Erickson family, which also owns Holiday Station stores. Jay Tibbets has been president since November, when Derek Siddons left the company. Siddons, who started with Gander Mountain as a store manager in 2009, had a prodigious rise to the executive team, being appointed president in 2015. Siddons said Saturday that he did not want to comment on the rumored bankruptcy.

The retailer, known as America’s firearms superstore, operates 160 stores in 27 states, including several that opened in 2016 in Pennsylvania, Colorado and Texas. More than 50 stores opened in the last five years.

Outdoor/sporting goods retailers have struggled of late. Cabela’s is being acquired by Bass Pro Shops. Eastern Outfitters, owned by Eastern Mountain Sports, filed for bankruptcy last week. Sports Authority declared bankruptcy and closed 300 stores last year, including a newly opened store on Nicollet Mall in downtown Minneapolis.