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A&P Supermarket Chain Expected To File For Bankruptcy, Another Harbinger Wipe Out?
Stunning that anyone in this environment can file for Chapter 11. But that is precisely what is happening: supermarket chain A&P, with law firm Kirkland and Ellis and financial advisor Moelis in tow, is about to file for bankruptcy, Bloomberg reports. It is ironic that instead of passing through costs supermarkets are instead opting out to default. Nonetheless, this is likely telling on the status of food margins at major supermarkets.
Some more from DebtWire as of November 10:
Great Atlantic and Pacific is working with restructuring advisor Moelis as the grocer works to ramp up liquidity ahead of 2011 maturities, according to two sources familiar with the situation and four advisory sources not involved. The company heard pitches from potential candidates through last week, said a trader and a proprietary trading desk analyst.
A&P needs to refinance roughly USD 391m of notes that mature in 2011 and 2012, including USD 159m of 5.125% convertible notes due 2011. As part of its turnaround strategy, the chain has been downsizing its footprint while squeezing out cash flow through sale leaseback transactions and asset sales.
A&P’s USD 260m 11.375% second lien senior secured notes due 2015 have been inching higher, bolstered by the emergence of substantial buyers, said a second and a third trader. Speculation is that Yucaipa, one of the company’s largest shareholders, has been gobbling up the paper, said two bondholders and two sellside analysts. However, Harbinger Capital Management is also rumored to be taking a position, said the prop desk analyst and a fourth trader.
Great, another Harbinger wipe out.
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A&P still exists?
I guess maybe not for long.
Tyler,
Betty Lu's "interview" of Ron Paul this morning on Boomberg, is a must mock.
Ron Paul as oversite chairman..
"Its like putting a Fox in charge of a hen house"... WTF!
of course we should expect the banker controlled media to villanize doctor paul. we won't be fooled.
Like the earliest Christians, we live in hope.
http://www.foxbusiness.com/markets/2010/12/10/tjx-pink-slip-workers-shutter-aj-wright/
TJ Maxx in major reduction move. I thought they would benefit from a weak economy ? guess not..
Two words: "Margin Collapse"
Rising input costs meet falling capacity to spend....and.... Kaboom!
This is just beginning. And the scariest part for Bernanke is that printing money just increases the input costs, further compressing the margin.
We are collapsing. Here. Now. And there is *nothing* the Fed can do about it.
Interesting,
Retail sector which should be the safehaven one....starts to weak...
How did the Bureau of Sanitary Information let this one get by? I was told that we wouldn't have any negative news anymore. It's supposed to be free money for all !Where are the helicopters?
Relax, NFLX will put a bid in for them over the weekend... they're working on new technology to download buttered popcorn over the Comcast pipe... Level 3 agrees to pay Comcast for the access. Should be some good upgrades next week.
A&P doesn't have the "pull" to get a helicopter run.
Guess the Bureau of Virtuous Economic Planning has spoken: we're phasing out the old concept of Americans getting up from the couch. If you can't download it, we'll have illegals deliver it. Poof! No more A&P. Bricks and mortar, you're on notice!
Ah yes, the Aristocracy of Pull
You mean they are not going to get more debt to pay off old debt Rudolf Havenstein style?
The 30% increase in commodity prices over the last year had to go somewhere. This is not because nobody talks about that, including the medias, that the problem does not exist.
High inflation is happening, and like every other major bearish event, don't expect Bloomberg to run headlines on this.
In Weimar germany, the financial press was telling how everything was so good and profitable just before the tipping point.
Societe Generale , calls for 2% 10yrs Bond Yield....as final wave of deflation...im with this french bank
So TLT during some 2011 months gonna be fine investment.
OK....I'll bite. How do I pick the months? dart board?
only the fortune 100 are exempt from bankruptcy thanks to the $9 trillion of interest free loans from the federal reserve bank.
why can't they do what everyone else is doing and float high rate junk bonds?
But the Great Ponzi...
one thing,
Its Impossible or at least very hard to mantain those basic material raw prices such high, (specially related to foods,agriculture,milk...) they must drop and hardly, cos general public doesnt have the same purchase power like last decade.
Thats why i think , major commodities world wide gonna drop hardly -so the Super extended commodity cycle is toppying and reversing, except those that could be considered as money collateral (gold,silver).
Just my humble opinion, i could be wrong of course.
I cannot afford this increase in food,energy prices...so i wont consume, in the same proportion than years ago, so marginally this sector is "Underperformance".
Regards,
The GATA boys and the CIGA crowd are probably kicking themselves for not unloading gold at $1,400 and rotating into bank stocks.
They could have parlayed their winnings and made 20% on the recent run up in COF, WFC, etc.
I bought a few bank stocks, but not enough....
You should go work for CNBC. You fit the bankster whore mold perfect.
CNBC?
to replace which one? they are all geniuses...
Gold/Siver off like "Pong"
Go all in short, then, if you are so confident.
I'm all in long silver with a bit of gold. I have yet to be caught oriented in the wrong direction.
The dollar is starting a nice "bull run" over the next 6 - 12 months. Buckle up, its going to be a ruff ride ....
i'm stickin with my longs in gold and silver and short DIS against 37 with a 38 stop.
That's the dumbest thing I've ever heard.
Like a skydiver that thinks he can fly back up to the plane. With an anvil instead of a parachute.
You liked it yesterday. Give it a couple of days, and you'll be back saying the opposite again.
Your advice is worthless. I wouldn't touch anything you promote.
And yet your gold short is what, $500 underwater, having expressed nothing but bearish sentiment on gold for years? Oh that's right, you now claim to have owned gold for a long time. How convenient, and hypocritical.
Being a permabear on gold means only posting charts when it is down. Fucking douche.
it reminds me of Gartman and Nadler...both longterm gold holders - but somehow, always say: NOW is time to sell...i wonder when they buy?
Post a 30 day chart
for now....what is true for A&P is true for the banks. "They have to pay off their impossible to pay off debts, too."
Not sure if I'm a "GATA boy", but I sold some at $1,410. Not much though.
Gold is down 0.14% today. Are you serious of just pulling our collective legs?
Anyway, put up some photos or flash clips of some hot chicks and we'll call it even.
You're a lying sack of manure. Show us the trades, a-hole. Bet you bought BAC at 11.05. FUCK you. I just bought more silver. And I'll be buying more through the holidays, giving it away as gifts to people who should buy more, but need education, like you.
Silver will be at least $50 by this time next year, if not sooner.
The GM of supermarkets..surely they must be saved? I stock shelves their as a kid in Montvale NJ.
their or there?
GM of supermarkets? Maybe they'll come out with government subsidized electric plug in shopping carts for rent and revolutionize the shopping experience!
Just wait till the avalanche of retailer bankruptcies after this BS 'holiday shopping season'. Everyone I know is doing the low-key 1 present have a nice dinner Christmas.
+1
Hi sheep,
You always says interesting things,
Have a great weekend.
My business has to be closed, at least i dont have debts.
Our families business was gone 2 years ago. I planned for it and dont have debts either, Merry Christmas.
And stupid me was planning to register an LLC and _open_ a business next year...
I am in agreement with you. That is why I have been holding onto some OTM March puts with a death grip.
Not trying to start an argument, but hasn't that "avalanche of retailer bk's" been called for for a couple years now?? Other than one here and there I haven't seen it. What tips it??
Bk's will kick in for real once interest rates rise and junk can't afford to refi
2008 killed Kay Bee Toys and Circuit City, which doesn't seem like a big deal unless you figure how few competitors either had or what kind of shape those competitors were in at one point. For every store/chain I see close, I don't see any new stores/chains opening.
And yet same store sales suck worse for best buy then when circuit city wasn't dead. Manufacturing fell off the cliff. It's not coming back ever.
Circut City. *Vomits in mouth.
That Chain has been dead 30 years always hyping the sad old model to those with more money than brains.
Let me tell you something about Circut City. Step inside the place and you get pig piled by 5 yapping sales people all elbowing each other to get the sale off you. When they find out you don't give a damn about anything except one wire to fix a computer (AT home mind you) they flee from my presence and ten damn dollars.
I took a friend with real money (About 1400 dollars cash) to look at the car audio systems in the early 80's that was really big in those days. The teen pimply sales clerk's TOTAL DISINTEREST and obvious dislike due to racial differences and such attitude as might be seen totally destroyed the chance of a sale. A big one.
Happens every time.
One day along comes Best Buy.
Next the Internet thing called Newegg.
Retail brick and mortar is dead.
But... we all gotta eat right?
I go to walmart two day ago to buy food. I see three stockers working, and not only they have to tend food they have to sweep the goods on the other side of the super center. Then only 4 cashiers handling a town of 20K that just got off work and trying to get everything together for the week. (Never mind the CRAZY 1st of the month when those with Govermint cards roll in after midnight Ugh.)
I go to the local grocery in town, they buy food from Sysco and the like all these vender trucks pulling up hither thither and yon all the day and night dropping off bread, chips, milk, staples etc. Even the meats.
They serve like 200 people a day with a staff of 10 Cashiers and 4 automatic machines for self serve with 10 to 20 more stockers running about like a herd.
In the mean time as long as there are sufficient numbers of people who cannot get out of town to reach the cheaper walmart down the road, this local food store will survive a long time.
When the places in retail CLOSE, they rot. That Circut City down yonder near downtown? been rotting for years now. The building aint worth the asking price now that it's accumulating necessary repairs due to nature and rot to bring it up to code again.
When I was a kid, we used to have arrabers with horse wagons deliver your daily bread, milk and produce door to door. No need to go to the grocery unless you had a holiday coming up and the stables downtown were closed for it.
I tell you something else heah.
All that good food to eat? Trucked in or dedicated trained in straight from either Yakima, Dole off a ship or out of Mexico ASAP. Lemons from Yuma AZ, Lettuce from California, Cheese from Wisconsion etc etc etc etc.
All of it hauled to your store at least 2 to 6 days drive and probably a day's pick and a day's blast freeze before loading into the trailer. I been on that side of it too.
Stop the trucks, no body eats.
Close the stores? Then what?
You tell me.
One more thing. That nice Best Buy they built close to the old dinosaur Circut City to bury that old dead store? They have a steel skelaton of a partially completed exterior of space for retail lease that has been rotting and rusting while attached to the Best Buy's new store building for ten damn years now.
That tells me smart money aint getting into retail. No sir.
Agree....but you'd know that better than I
I find that as well Sheep. My family has cut gift giving to each other by 90% this year and focusing on some charity service.
Anecdotally I see traffic down quite a bit in retail. We could be in for a big shock.
Unless they can just outright fudge the year end retail numbers somehow. Who measures this stuff and how do they do it anyway?
A&Pcan'thasbailoutz?
I've played A&P shares (GAP) and notes (GAJ) for a couple of years, but not in the past six months or so. A&P has taken big losses and had negative equity for a while. The present principal owners are German (of Tengelmann grocer fame) and the company is not that big. So despite their long history in the East, I doubt politicians are interested in helping.
Gold Bugs are having "scroomers remorse".
Gold stocks have gone straight down, but Chinese IPO's like YOKU have doubled from $25 to $50 in 3 days.
Three DON'T - rules to investing.
Don't bet against:
- the tape
- the FED
- the Chinese
Don't waste time junking Robo. Just trade the market.
If I had a bigger bag of money, I'd sit on the sidelines. We have to eat and we have big medical bills to pay (sorry BO, we pay our own way), so it's off to market I go.
I see. In Robo's world, we should all chase obvious bubbles, and stay out of assets in bull markets.
Have fun masturbating in a burning building. I hear getting crushed under burning rubble makes the climax much more satisfying.
Robotroll doesnt trade a damn thing, just posts charts. Only slightly above the level of the avg Yahoo!Finance message board troll. And his posts are always 'in yer face', showing he's got issues.
GANGBANG!!!!!!
Some of us do this thing called "buy and hold" ....
I get the impression that's a really rare investment strategy anymore. I mean, that's how I do it, but even I'll admit it seems to be more for ideological reasons than money-making.
...which is a fool's errand.
Don't worry. THe market is just a Free Money Gauge, reflecting loose government pocketbooks.
That's very bullish for gold, as well as inflation.
More telling as TD points out, the margins must be getting killed as core prices explode-
How can they sell MILK for $2.19/gal in the US when milk in Germany costs $7.50/gal? How can they sell eggs for $.99 /dzn when in Germany they cost $4.00?
Artificially low prices are a thing of the past- expect to see the increased inflation passed on to the consumer. Re
"farmer suicide." and i'm being serious. milk is a bargain because we have "uber cows" in the USA. more to the point "you don't have any money so you ain't buyin' food." when you factor in the literal "overhead" of running a supermarket and even Wal Mart is suckin' wind in the "food space." i think a more efficient model and perhaps only cash flow positive way for food distribution in this environment is to actually sell the food right off the back of the truck since not only has the value of fixed real estate completely collapsed it is in fact "going much, much, much lower." Not only that but the costs on that so called asset are soaring via taxes, energy and maintenance costs. Simply put "selling food in a building is not cash flow positive." Write 'em all off save for the highest of high ends like a Wegmans which "are geared towards retailing" and not just "selling a 5 dollar loaf which no one wants." In short "here comes the vice grips for your food retailer political cock fuck."
I can see the milk thing, we have plenty of cows, all our dairy products from Sinton is local, you can go right there and pick up milk or cottage cheese, all made the same day. Cant just compare US prices to things in Europe either, their taxes are insane, and while that gallon of milk in Germany may cost $7, its probably subsidized out the ass coming and going.
I don't see those vice grips to regularly at my part-time job, but then we make a selling point of buying in-state and locally where possible, so maybe we're not reimporting Chinese inflation as badly. I haven't seen the books of course, but the hour-cutting stopped a year ago and they got rid of the self-scans last week. The litmus test for me will be whether or not the company does the annual Christmas bonus or not.
Retail has traditionally had small margins anyway, even food distributors. They eke out a couple %. Not much room for error. It's hard for retailers to react to price swings quickly while battling the competition. The solution will be culling of the retail herd to less supply and growing higher prices.
People can change buying habits overnight, retailers can't react that fast and have no buffer in margins. You can go from buying black angus steak to Ramen in your next trip to the store.
Grocery relies on the higher margin "perimeter" of the store to goose earnings. The perimeter has bakery, flowers, banking, pharmacy etc.... The center of the store is generally the staple goods. People can just ratchet down their budget and ignore the perimeter and stick to the basics.
I wonder how Aldi stores are doing? small foot print, cheap prices on basics. I imagine they might do quite well filling in cheap rent spots where bigger stores have failed and where a super target or super walmart will not go.
Except in health and beauty. My brother used to be an assistant manager of a Kroger store. He said they made a monthly profit on the HBA aisles equal to the cost of the monthly electricity bill.
And they can probably spend a bit of money to replace the power hogging tube lights for LED's that will light the same space on fraction the power.
But they wont do it because they are trapped by the profits being lost by the big electric bill.
I TOTALLY agree with the agility of business. It is very difficult for a store manager to watch the Angus Burgers Pile up and develop frost icing on the boxes for weeks while the daily special on the ground beef burgers vanish at half the price.
Yup. Dean Foods s hanging on by fingernails. So are many companies where inputs are rising into a constrained US consumer.
Biflation is killing margins, as I said here for over a year now.
Milk is a loss leader. They make it up on things like Gummy Bears ($2.00 for 5 ounce container).
What kind of government subsidies still exist for milk/dairy/farms/grains etc..? That has to help keep prices down.
Not a damn thing now I think. Two decades ago they paid farmers not to grow anything. Now that they are bloated in foodstuffs after the harvest and Russia making surer to hold on to her Wheat (What little is left) till Christmas before exporting any extra...
Let's hope for a few more good harvest years in the United States and Canada along with other places.
Coffee doubled in the can and the amount in ounces got smaller to boot. So you are already paying more for less this year.
It is interesting that Art Cashin was remarking about a month ago on feed and basic foodstuff prices tricling through to the public at about this time. Well, grocery retailers who have been toeing the party line and not letting the public see the oncoming wave have possibly been damaged by the lowered bottom line.
As motivated above: Do the lower tier (how does the grand-dad Atlantic and Pacific Tea Co. get qualified as lower tier? maybe this is a reverse bail-out??) fail and condense the traffic of lemmings rushing in for their groceries? To only one provider, Der Stadt?
The Wiz of Cheez? Fresh from the Gulf to You is This Week's Compulsory Edible! Eat Your Ration Before You Get Your Meat! You, Yes, You! Eat you corexit before you pick up your meat!
La!
This will have an impact , A&P's are numerous in the NE, & are the anchor tenants in the strip malls. Of course the thousands of lost jobs in the Northeast and empty stores.
The article does not say they are liquidating, merely filing for bankruptcy protection. In America, that just means debtor-in possession, reorganization, screw all your vendors and keep going. Think of the airlines. Bankruptcy is just a business planning device, a method for making one-way bets with other people's money.
Cept, I gotta go get the stats on Bk and survival. I'll come back and put a # up.
From
http://www.allbusiness.com/buying-exiting-businesses/exiting-a-business-...
While the goal is to emerge from bankruptcy with a healthy company, Chapter 11 is too often the beginning of the end, according to Lynn LoPucki, a law professor at the University of California, Los Angeles, and a leading authority who has maintained a database of filings since 1980. Of the companies in his database that filed Chapter 11 petitions in 2000, 20 percent went in with the intention of selling off business assets and folding. The remaining 80 percent followed the Chapter 11 reorganizing process, planning on emerging leaner and with less debt within a year or so. Twenty-seven percent of these optimists failed to make it and had to liquidate. In the end, only 53 percent of the companies that filed actually emerged from bankruptcy. And even those survivors face daunting odds. "Twenty to 30 percent of the survivors will fail in the first three to five years," LoPucki says.
And one other info which is along simular direction
http://business.umsl.edu/faculty/finance/Zhang_Publication/FM2010_Emergi...
Thank you for that information. I am not saying that A&P will not face eventual liquidation - who knows? - but merely that a bankruptcy filing does not equal liquidation. Bankruptcy should mean liquidation, but in most cases it just means reorganization. It is a scam.
By the #s on the first report it's saying 3.5 out of 10 left standing.
The second report gives some interesting stats on how sector neighbors bear the $ burden in performance in the short run.
Place your Bets.
Hey Tyler n' the rest of ya folks,its not just in the retail sector things look dire.The economy is much worse than previously thought.Ventriloquists are now the new members of the 99ers club.
Last night I stopped by at my local bar for a shot of brandy.I sat down at the bar next to a drunken Ventriloquist and his dummy:
Our conversation:
Ventriloquist:"OH SAY CAN YOU SEE ,BY-LA-LA.LA....LAHHHHHH....BLUGHHHHHH"
Bartender:"He's out"
Dummy:"Hey Buddy, howz a' bout a drink......"
Me:"Hey how the hell did ya do that? I mean,ya partner's out cold.......but who's a makin' ya talk? HEY Bartender......a brandy,err......make that two"
Dummy:"Over 20 years in the entertainment business you tend to pick up a thing or two.Hey,Bartender........skip the brandy jus' give us the best you have"
Bartender:"Okay....one Dom Perignon Methuselah coming up"
Me:"So what's up with your partner?"
Dummy:"He's a nut.......a drunk....a born loser....he doesn't understand the meaning of the word DEEPression neither has he any idea of how ineffective QE monetary policy is in stimulating the real economy.I keep tellin' him its the economy stupid, so stop being so hard on yourself by getting liquored up every night.Things are sure getting nasty out there,the entertainment industry is in a tuff spot as even MGM filed for chapter 11 in early Nov.
Me:"Ya don't say..... yeah but NETFLIX has increased over four-fold"
Dummy:"Sad thing is,i'm the only one in the family who is unemployed".
Me:"TOO BAAD"
Dummy:"Take a look at this picture of my younger brother employed as a chauffeur":
http://cache4.asset-cache.net/xc/3420282.jpg?v=1&c=IWSAsset&k=2&d=45B0EB...
Dummy:"This photo was taken showing my elder brother on his college graduation.":
http://cache1.asset-cache.net/xc/3399680.jpg?v=1&c=IWSAsset&k=2&d=45B0EB...
Me:"Now that's just swell ain' it"
Dummy:"I just need to get my act together......we need a different theme.... maybe say like a banking/financial broadway routine?"
Me:"Now thats an idea"
Dummy:"Hey buddy, how a boutz we get together"
Me:"Nahh,ah-ah...no way......i aint shoving my hand up no dummy's ass"
Dummy:"Hey wise guy....now,who do you suppose is making me talk?...dumbass"
Me:"Ya got point there...hey,who ya callin' dumbass...YA DUMMYASS"
Dummy:"Hey don't leave me.Please stay....Bartender....BARTENDER, A BOTTLE OF CRYSTIL ROSE MAGNUM"
Bartender:"One Rose Magnum comin' up"
Dummy:"Now,back to business....".
(LATER THAT NIGHT A FEW BOTTLES LATER)
Bartender:"C'mon fellas its getting late....time to close up"
Me:"I guess a'll be seein' ya...... ya thought ya get me all liquored up like ya dumb partner....sorry no deal "
Dummy:"You'll be sorry...you'll regret this for the rest of your life"
Me:"Yeah...Yeah"
Bartender:"Your bill gentlemen"
(The Bar Bill)
http://i.dailymail.co.uk/i/pix/2009/02/20/article-0-03980C66000005DC-875...
Me:(Clicking my fingers)"Damn, left my American Express in ma other suit.
(Dummy's reaction):
http://www.promonews.tv/wordpress/wp-content/uploads/2008/11/picture-7.jpg
Dummy:"COME BACK.....COME BACK......YOU SWINDLING TWO TIMING CHEATING BUM....COME BACK......COMEBAAAACCCCKKKK!!!!!!!"
Margins in this business are razor thin, but still this is puzzling as their competitors have been doing ok, and consumers don't seem to bitch about paying higher food costs. Not sure I get it.
'Competitors are doing ok'...can you provide their spread sheets here for proof of how ok all others are doing?
'Consumers arent bitching about higher food costs'....are you single? Its all I hear about for an hour after every trip to the store...'You see how much THIS costs now? And look at THIS! Used to be .50 cents less just last week!
Im hearing it all the time. And whenever I drive by this Safeway here, its empty.
Dean Foods is in deep trouble for same reason. So is Tyson. So is Sanderson. Across the board. And it's just the canary in the coal mine of any business where cost inputs are rising into a constrained consumer.
Biflation is the beast killing margins through higher costs but lower consumer buying power. What's left of the US domestic economy hangs on razor margins due to massive overcapacity and foreign competition.
I don't get why overcapacity is such a problem. Undercapacity in the food market means people starve. Are you saying we have to starve America to save it?
I'm really not beng flippant here, I honestly don't understand.
Much of the price raises are hidden even though you have seen some price increases.
If there was a study of the price being the same, but the amount of product shrinking, you'd be astonished! Must be good biz for the packaging consultants redoing packaging and designing it to look big but contain less product. Look at the indent bubbles in the bottom of glass and plastic bottles for example. They are getting huge.
It would make for an eye opening study to see how the net weight of various products have shrunk.
It's the same game they play with the nutritional information. You want to cut the calories per serving in your product? Don't mess w/ the recipe, just double the servings! Boom, you just cut your calories in half!
What is a serving of doritos these days? 2 or 3 chips?
I used to deliver to the old distribution in West Philly for A&P, Safeway and other area stores decades ago. We had armys of ants working on the docks crawling over the pallets of foodstuffs by the hundreds each morning before sunrise.
All of that is gone. Replaced by a Stadium and parking lot now.
are you "I" or "they"? More to the point..."they have no margins." Supermarkets are big employers--unionized work forces with real benefits so to answer your question "no, their competitors are not doing okay." since tranporation costs for food are absolutely huge and "are food is now grown way the fuck over there" simply put "the stores and all its employers die." if i'm living in a major metro area other than restaurants i'd start to wonder "just where the fuck that food comes from." no worries, though--we got protein pills for the holistically challenged. who needs real wheat in bread, right?
Any grocer that has unions almost has to go bankrupt to bust the union to ever hope to survive. They cannot compete with super walmart or super target with a union monkey on their backs.
A family friend was a union cashier, yes union cashier at a grocery store and made $15-25 an hour in the 70's-90's and retired with a generous pension!!! Yes a freakin pension for a fooking cashier.
And greenstamps for all.
You would have done well between that store and the 5 n dime down the road back in the day.
In those days you did get a pension even if all you done for 20 years is sweep the floor. A small pension to go with your social security, but a pension never the less.
My pa got a pension when they bought him out, basically retiring him at 45 instead of hanging on to his very high paying job until 65 with ever increasing costs of his salary and benefits.
They sure saved money yessir, but Pa... he's around still.
I ate there in gradeschool.....a Greenriver, chips, and a Maid Rite...my school lunch program
Let them eat iPads.
LOL +1
Of course, anything not a Inter-Alpha group Bank or linked to one cannot be bailed out.
Bailouts are for fake things
Not real ones
Physical economy crumbles, while everything else hyperinflates. Enjoy.
They can't pass on costs, because gasp, no one has money. These aren't the only ones. Fresh and Easy is Dead as Dahmer. Bashas' (~130 stores) is/was under Bankruptcy here in AZ, the supermarket warring capital of the U.S. We also have among others; Fry's (Kroger), Albertson's, and Safeway, etc.
These guys aren't in the banksters tent, and until about half of these fail, don't expect anyone to notice much.
Harbinger of it's own destruction lol
Yep, they sure aren't getting any protection from the powers that be.
Remember Bush Sr. wondering how a checkout scanner works. The elite have no need for retail grocery stores. they have personal chefs and 5 star restaurants.
In DC and on Wall St. it is socially unacceptable to be seen in a grocery store or pumping your own gas.
this is what happens when cash itself dries up. supermarkets collapse. i found it very interesting that Rick Santelli said "rates on cash vary." Isn't that interesting..."same cash, different rates"? how is that possible you might ask...well, A&P isn't asking...they're dead now as with all their employees.
I've definitely been noticing lack of people in the supermarkets here, its obvious. And I can always park right in the first row by the door, never used to be able to do that.
SheepDog-one
The stores are still really busy, just not when you go. Only packed when the CEO of Walmart says.......around the first of the month when the foodstampers get reactivated. With that money spent in the one trip they are free to stay at home for 4 more weeks to watch football.
Bread and circuses.
Sit and watch a food store for a week.
Sunday Afternoon, church rush.
Monday, everyone gone. Sale day.
Tuesday Stocking.
Wedensday some will come.
Thursday paper products vanish as college kids get ready to party.
Friday night everyone comes to shop for whole weekend. Take a look at each cart coming through the line and match it to who is buying it.
Take a look at the old grandpa living by himself buying a bit of roast, ground beef and some taters and bread. perhaps a bit of produce to go with it.
Or take a look at mama with 5 screaming infants running about everywhere and one on the way and three carts filled with sports drinks, chips and junk good heavy in salt and what not because mama is tired and cannot take time to cook. That little credit card she swipes (And the 10 minute wait for supervisor to approve it....)
Take a look at college kid. Pringles, soda, smokes and a bit of pizza.
Take a look at the middle aged couple. They stand with ledger pad and calculator adding up everything going into the cart and making decisions what to get for the week and what they can do without and trying to buy only on sale. But still the prices rise.
I have seen a lot of Winn-Dixie stores closing here in the Southeast. They have been on thin ice for a while , competitors cleaning their clock.
They did file bankruptcy in 2005 but suppossedly are making a come back/
And my hometown chain Wegmans continues to build their massive Taj Mahals throughout the northeast.
Hey, Grifter, another Rochestarian! Great weather we're having. Where's Algore and his global warming when we need him?
The Wegmans in Irondequoit (Titus/Hudson) is usually so full of welfare mamas who think it's chic to shop there rather than the Wal-Mart closer to their homes, I don't go there much any more, except very, very early in the morning or late, late at night. Otherwise, Price-rite, Aldis, Wally's and the Dollar stores are skinning 'em pretty well, though the sheeple still crowd in there for the most part.
As my late father used to say, "Wegman's got a big ass."
You dont want the dollar stores down here. There are a dozen of them within a 20 minute drive in 5 counties. And everyone of them are full.
Morale is low, volume is so high no one has time to clear the floors between the shelves and the trucks keep coming. Throw the stuff in the corner in the back and they will get it for you if you dont.
It is literally a mental drain, emotional depressing and totally crap to go into a Dollar Store.
If you are not going, you are doing well. For the rest who flood those stores?
Well.... I suppose they are used to living in the mud down by the river now that the good house is gone to the bank.
Free the Food!
We can always nationalize grocery stores and ration food like Chavez.
All in this sector are in trouble. THis is the ripple effect of what I've been referring to as biflation. Cost inputs are rising but can't be 'passed on' to a shrinking pool of consumer disposable income as consumer net worth tumbles, real incomes tumble and employment is souring. By the way, the last weekly employment report yesterday without the 'seasonal correction' factor was over 500K (!)
Perhaps all the b.s. games the grocery sector has been playing by reducing package size, portion sizes, quality, filling packaging with air, etc. has hit a wall. They can't "hide" inflation with these gimics anymore, nor can they easily raise prices in their highly competitive markets.
Steaks are ridiculous, I was looking at some supposed 't bones' the other day the quality sucks theyre nasty looking and theyre going for about $8 a pound. And the ice cream is getting returned in droves, obviously had melted and re-frozen pointing to skimping on refrigeration on the shipping side.
Don't you love those bright red dyed, "fresh" cut sinewy steaks? LOL
some stores even advertise their steaks are fresh cut, WTF? LOL. no wonder they're going out of biz.
gimme a dry aged (rotted ;) porterhouse on a 1200 degree citrus wood grille baby!
Not to mention they inject the fuckers with 3 ounces per pound of salt water.
Let me tell you something about steaks.
I take em out of a meat plant center cut and packed to the box and sometimes to the tube. Weighed down to the ounce. The very best go to Darden Foods which by the way distributes to Red Lobster and such other good places to eat.
The next level down are the independant taverns that serve food and butchers around the city by sunrise.
The next level down get the lesser grade meats cheaply for the grocery store to butcher and pack. And re date, repack for tomorrow. Sooner or later you see 4 or 6 date stickers stuck to one another.
If the meat sit long enough they get resold to wholesale.
Eventually sent to a plant to make cat and dog food.
Nothing is wasted.
Not only the wall is there for package sizes, quality and pricing... but the people are learning to live on a cup of noodles, some hot water dearly bought with a high heating bill and perhaps a beer or smokes to raise morale and chase the hunger away so they can sleep until tomorrow.
Each month they come in and loot, pillage and make merry with lots of stuff. They have to because three more weeks of famine awaits until next month.
But by gawd I miss the western steaks, cut, butchered and cooked the same day with the trimmings out west between the red river and up the Yakima.
Just my observations, but Walmart prices most food items about 20% under those from my former supermarket, StopNShop in Connecticut. I can't imagine this doesn't hold for most of the country in which they compete.
I thought A&P would merge with Stop & Shop to become The Stop & P;>}
Shop and stop still around?
They used to turn away food trucks if they arrived more than 15 minutes late. Make them sit a day and reschedule a new delivery next day.
And another
http://www.courant.com/business/hc-aj-wright-closing-stores-20101210,0,7...
I remember Gordon Brown writing an article a few years back in which he indicated that with commodity prices rising, companies will be forced to choose between raising prices to a level that would make them uncompetitive, or face insolvency. If they choose inssolvency, then they will be forced to lay off employees, adding to the unemployment rolls and increasing the unemployment rate. He said this may set off a death spiral of higher unemployment, followed by slower sales because fewer people are buying, thus leading to even more lay-offs. This would, in turn, cause deflation of home prices. So we end up with higher prices of necessities like food, and deflating prices of debt-purchased assets like real estate. This may be an opening salvo in just such a scenario!
But never fear, the Fed dorks are here!
WEEEOOOO
As a very good friend of mine, who owns a 300 truck+ distribution company, says:
"The problem with this economy...the problem is...nobody has any fucking money."
Of course, that's not applicable to Washington, D.C. and its suburbs - full of government workers and contractors working with/for the government, or the general 5 mile radius surrounding Wall & Broad Streets - full of organized crime syndicates...I mean financial firms and banks.
Actually it is the OSD that eats it up, Invoices not yet paid that piles on and the Tractors that are sitting out back waiting for drivers to finish orientation. You bring in 50 on monday, ship 40 home keep ten on, see 5 quit next week and bring in 50 more next monday.
Food? distribution a tough tough racket. He should look at selling out while he can.
I am thinking about getting back into the food mfg biz again, this time it would be long shelf life survival food. I read the current companies can't keep up. Of course I could just sell twinkies as I think they have a 12 yr shelf life ;)
there's no productive enterprise to speak of left.
I live in DC suburbs and Harris Teeter is packed constantly...sort of a midway between Whole Paycheck and a Safeway in terms of price points
I guess everyone moved up to whole foods. Love spending five times as much for moldy fruit.
It seems to me that this is to be expected with dollar devaluation in a weak economy. People have less money at the same time basic commodities like fuel and food go up. To me, this poses huge risks to food chains and also to restaurants. As people eat out less, they should end up in the supermarket so there should be some balancing. If they've got a wholesale job loss then even the supermarket buying gets thin. I've had two income reductions in two years and outside of government, I don't see people getting raises much less staying employed. I think the real problem for us could be that if the rest of the world, particularly Asia starts to emerge from their recessions, they will bid up commodity prices even as we stay flatlined here at home...and come up with more 3000 page regulatory bills, subsidies, tax increases with targeted tax decrease, mandatory benefits, ad infinitum. I think we are in an economic place we've never been and the consequences may be drastic. A&P is suffering a somewhat predictable result of our current policies. Plus, I actually think there may just be an oversupply of gigantic food stores and chains. They are on about every major intersection that I can see. Good luck to the employees who will have to scramble for work.
the restaurant slowing traffic doesn't necessarily translate into higher grocery sales. Everyone is trading down and getting by with less.
People without jobs have all the time in the world to cook. So minimally-processed (lower-margin) foodstuffs come into fashion. The companies which have reaped significant profits selling pre-cut potatoes at four times price per lb have to readjust. Food stamps are a subsidy for the processed food industry.
I don't think there's much premium can be charged for "convenience" anymore.
It is interesting to speculate about what happens in case major food manufacturers actually cease operations.
Maybe a few did. I think there was one who was caught not cooking the food as hot as they are required to cook at to save a dollar on the energy. They had to close down or pay a fine, say they are so sorry, so sad and wont do it again and make less heated foods in exchange for cold stuffs that you have to heat with varying results yourself.
Long ago Flour and what not got turned into good things to eat. But back then you had a FAMILY unit from Grandparents on down working a routine all the time while daddy was at work bringing the money in each week. Everyone had thier part in the household.
Now there is just me and the wife. I hold the house and wife decides how best to make what we buy each month work while putting away for next month against famine and growing crops out back each year.
As I type this, there is a crock pot in the corner due to finish the pot roast for both of us later tonight. Slow cooking is slow living down south.
Peeling taters out of Idaho and slicing carrots along with a bit of McCormick and something to drink and bread/butter makes a meal. Dont take but 30 Minutes labor to put it all together.
Time? Sure we have some time.
But the people out of work? They are so stressed, they need to ESCAPE the time that they suddenly cannot handle due to the hunger, want and needs.
A 30 year debt bubble caused massive malinvestment and overcapacity. Now the weak have to be culled.
If you are not part of the economy being supported by the bankster cartel, the economy is brutal. This is no surprise. Over time, even the "select" few saved industries will suffer.