- But even a business model that “remains a compelling proposition over the long term” wasn’t enough to immunize the company from a decline in mall traffic, which fell around 8 percent year-over-year, Huckins said in a court affidavit. The company also had too much debt, costing it $183 million a year alone in interest payments, he said.
18,000 employees, 3,600 locations worldwide. But they're going to restructure this through the help of private equity and then everything is going to be fine. It's going to be just fine.
This is just like, the worse. fucking. year. I was talking to a friend the other day, about Toys R Us closing, and we discussed a bit about how we both share concerns about how the way America pursues materialism and consumerism might not be the healthiest way we go about things. We wondered if there's some kind of unseen light at the end of the tunnel here, what it might or might not look like, and how we'd end up getting there. The thing is, all of this shit's happening so fast, we just don't really know how to take it all in, and shit seems to be speeding up. To the two of us, this feels like a genuine economic crisis unfolding.
Yes. And yet... You can walk down the street and buy a taco from a food truck. And the guy handing you the taco is probably also the owner of the truck. And innumerable people have full-time businesses and health care ... and they walk dogs for a living. And most people have a "tax person" they go to, who - during the day - probably works in Accounts Receivable for a local company, but during tax season moonlights as a tax preparer. And some woman got a loan and opened up a coffee shop, and employs six people, two-shifts a day, 7-days a week. So yeah. If you are a big, rapacious, corner-cutting, tax-cut-asking, company that imports 90% of their products from slave-labor markets, and fails to pay your employees a living wage, and sucks at the corporate teat of tax breaks and federal benefits... your business is coming apart at the seams. But people will still need products and services once you pull your golden parachute and bail out, and that's going to push people back to local businesses. Ones you can trust. Ones that are just good people, trying to provide a product and service they are proud of. And I'm not sure that's a bad thing. If Amazon replaces ALL of the big box stores, and their hyper-efficient delivery system makes sure my staple needs are taken care of, then I have more time and inclination (and money) to patronize my local providers for those things that make life good. Simplistic view? Sure. But... a reckoning has been coming for a long time. WalWart and all the others can only suck the government teat for so long, before it runs dry, and their unsustainable businesses come crashing down.
We're mostly of the same mind. A different friend of mine pointed out how companies like Toys R Us and Wal-Mart were Amazon before there was Amazon, which was also reflected in this comment by kleinbl00. One of the ideas brought up, is that twenty to thirty years for now, we'll all have our people down the street that are our preferred small business go tos. For example, I have my preferred bookstores, one of my buds has his own tailor (who is surprisingly affordable!), many of us support small business from candle and soap makers, to pet supply stores, to pretty much anything. Almost all of us love family owned restaurants, especially of the ethnic variety, and try to eat at those places more often than fast food and chain places. Durable goods tied into this whole conversation too, which kleinbl00 also alluded to in his comment on this thread, but I don't really have much to expand on that. There were two big hurdles that we discussed with this idea and we don't know what to think of them. The first and foremost is that specialty stores will employ less people and if durable goods become the standard again, there's gonna be less churn in retail. This means those without the skills, knowledge, and resources to start their own businesses will be left in the lurch and additionally if goods last longer, and people by less, demand will go down. Both of these things will mean that while goods and jobs might be of a higher quality, there will be less of everything to go around, once again meaning some people will be left in the lurch. The second big problem that we see, is that if retail changes, other things are gonna change too, from health care and benefits, to real estate landscape, to demands on transportation, to a whole bunch of other things. If all of this collapses too quickly, and if we as a country lack appropriate and effective responses, there are gonna be ripple effects that could potentially be both wide reaching as well as long lasting. It's the unkowns in this area that really have us worrying, and while we can make predictions, we just don't know what we're gonna come across, let alone how to address it, until shit really starts falling apart. By then? It might be too late for a lot of people.
I understand and respect your concern for our fellow Americans and their jobs, but I think it might be a bit patronizing, if you dig into it a bit. For example, if we take your position back in the early 1980's, you could be saying, "Personal computers are going to put typists out of work." And, "Full Service gas station attendants will be left in the lurch, when people pump their own gas/drive electric vehicles." The thing is that the future is not a straight line from the past, projecting forward like an arrow to a predictable future. Shit changes. When typists are no longer needed, they find other - usually more fulfilling - roles. Some of them got into Desktop Publishing and layout, and then moving those skills into electronic newsletters, and finally web pages. Secretaries got greater responsibilities, because their time was not taken up with typing any more. Personal growth changed from receptionist > typing pool > secretary > wife-of-an-executive, to demonstrating an ability to learn and adapt and get into management. Or sales. Or marketing. Shit changes. People adapt. People also age out of a demographic, and into a new one. The young ones coming up behind them - like the typists' kids - grew up with computers, and got into web and software development. (For example.) Cohorts grow obsolete, but still need to make rent, so they adapt, change, move somewhere else and switch careers, go back to college, take online courses, get into government retraining programs, and they continue to pay rent, and buy cars, and work other jobs. The only people who get left in the lurch, are people like coal miners, who stayed with a dying industry, in a town with no other options. And there has to be some personal responsibility there. Any one of those coal workers could have taken the government retraining that was being offered, and learned web design. Then started a business teaching other people in town the same thing. Then hired their neighbors to do more work, for clients outside the area. But they largely didn't. (Well, some did.) Shit changes. And we can't see today, how things will be tomorrow. And thinking that we need to help others protect themselves from being left in the lurch is a touch patronizing. Just a touch, but still patronizing, nonetheless.
We knew it was gonna be. I think there's light at the end of the tunnel. In 2008, the economy tanked. In 2009 the Writer's Guild went on strike and we observed something interesting in Hollywood - the 3-chip DV losers all went crying home to momma while everybody who had managed to stake out a network of referrals and friends hunkered down and survived and ended up getting more work at the end of the day. The industry is the same but there's a lot fewer pikers in it. Pike Place Market is subsidized to fuck and favors scrabblers to megacorps. A giant shattered mall, though? Nobody needs to subsidize that. The last time vinyl fucking mattered it cost $7.99. Cassettes were $9.99. Then CDs came out and somehow they were $15.99 because fuck you. Now? Now everybody buys downloads for around $10. If you want a CD, it's like $11 on Amazon. Vinyl? Fuckin' $20-$30. Now -we can get into the hipster dumbness that is driving vinyl sales. I'm not a fan. However, vinyl is an object. It's something you can fetish over. It's something you can lord over your friends and hold close to your heart. And if it costs 3x what downloads cost it's also making the artist a lot more money. I've been saying for years that nobody wants to buy a $25 DVD player. Nobody needs a $25 DVD player. Now that we're largely consuming media through our phones we're done with all that. Thus dues the phone become the one large expense we have to deal with while everything else becomes optional. So the question is: how much disposable crap do you want in your life? I split from minimumwage at that one forever and no regrets. She had some positive things to say but she was also a thief and a drug addict who hated everyone who wasn't a thief and a drug addict. My view has not changed: people who buy expensive things buy them because they expect to have them for a while and worldwide, there is no manufacturer held in such prestige across so many industries as American manufacturers are. the business model of a Claire's is containers full of cheap Chinese potmetal and glass purchased for pennies on the dollar and sold at outrageous markup to pay for ridiculous rents at shopping centers where materialists converge. Yeah, they got their ass handed to 'em by interest payments but the reason this is happening is the retail equation is changing. Chinese markup is increasing. Rents are increasing. And materialists are doing one of two things: (1) decreasing their spending (2) increasing their standards. There's a lot of dead malls. there's about to be more. There's a lot of underemployed millennials. There's about to be more. That means there's about to be a lot of downward pressure on rents and a lot of upward pressure on entrepreneurialism. I think if you survive to the other side you're going to be better off. And I think if you can't survive to the other side you'd best find shelter before the rush.
I'm okay with people buying less cheap goods, for many philosophical reasons from reducing the environmental impact of our consumerist behavior to allowing us to realize that we don't need to fill our lives with stuff to make our lives feel fulfilling. That's part of what I alluded to when I said I was talking to someone who has similar views about materialism and consumerism. I'm deeply worried about the loss of jobs though, even if society doesn't seem to regard them with a lot of value, and what that will mean for individuals, for families, and for communities. I worry that too abrupt of a change will be too much for us as a country to handle.
Yeah. I think I was there about eight years ago. The first time I heard John Mauldin use the term "structural unemployment" I knew that economists had managed to make carnage palatable through the studious application of euphemism. "the jobs that never came back" sounds every bit as horrible as "all the money you lost." Far better to use cute terms like "structural unemployment" and "haircuts." Haircuts! Who'd object to a haircut? Even a $270 billion euro one? What followed was some heart-hardening and a steel-eyed view towards the future. This country has handled some real shit, man. The more I study history the more patriotic I become. I believe that one of the reasons things are so divided right now is we don't have anything unifying us. Hardship is unifying. And at this point, I think it's unavoidable. I also think it's going to be purifying, like a crucible... and like a crucible, a lot of people are going to get burned to a crisp. Where we differ is that I've given up hope on the people who are going to lose and have been actively doing all I can to separate myself from them. I think we're going to be okay on the whole, but individually a lot of us are going to suffer. I can't help everyone and the better off I am, the more people I can help.I'm deeply worried about the loss of jobs though, even if society doesn't seem to regard them with a lot of value, and what that will mean for individuals, for families, and for communities.
I worry that too abrupt of a change will be too much for us as a country to handle.