KMART Files Chapter 11 Bankruptcy

CNBC Breaking Live

[RCW2001]

KMART Corp. Files Chapter 11 Bankruptcy...breaking live on CNBC.

Will post wirecopy as it becomes available.

[truthkeeper]

Thank you, nice smart person. ;-)

[RedBloodedAmerican]

They should give away their guns. Piss on Rosie.

[Clemenza]

Attention Kmart shoppers: There is a blue light contract on Chuck Conaway!

[RSADGE]

How much of the so called great 1990's economy was a fraud? Th dot com's and the enrons played fast and loose with the rules. Now where did they get their ideas from? It wouldn't be the Klintons would it?

[RedBloodedAmerican]

Thanks. I didn't recognize her without her make-up on ;)

[Rodney King]

When KMART began to have troubles, none of their suppliers wanted to ship to KMART on credit. A surety bond would be a bond that KMART purcahses that would have guaranteed payment to suppliers by the surety bond company in the event that KMART was unable to pay.

While it is true that credit may have tightened a bit since the Enron fiasco, the reality is that obviously no insurance company was willing to sell KMART a bond at a price that KMART was willing to pay. Watch, I bet they will blame 9/11 next.

[NittanyLion]

The commentators on CNBC are saying KMart is partially blaming the problem on being unable to get "surety bonds,"

They should blame it on this (Numbers are approximate):

K-Mart, 1990 - $32 Billion
Wal-Mart, 1990 - $32 Billion

K-Mart, 2001 - $32 Billion
Wal-mart, 2001 - $180 Billion

[veronica]

Hysterical pix, btw. Very funny.

[tdadams]

I'm not an economist and don't have an MBA, but can probably give you a glimpse of what surety bonds are. Surety bonds guarantee a company's suppliers will get paid even if the company doesn't have sufficient short term cash flow.

In the wake of Enron's collapse, the price of surety bonds have gone way up, due to obvious added risks of the surety bond business.

This has eaten into the slim margins Kmart was already operating on, forcing them into banruptcy.

[PRO 1]

IT SERVES THE 'ROSIE O DUMBELL' STORE RIGHT.

Maybe the suckup PC execs will wake up a little.

[KneelBeforeZod]

clearance sale on all ammo!! let's go!

[GraniteStateConservative]

Yes, they said on the news that K-Mart can use this as an opportunity to shut down poor-performing stores (meaning a complete shut-down of the stores-- K-Mart pays rent for the buildings and is still under contract even though they want to shut down the stores, and this will allow them to completely stop spending money on anything unprofitable). K-Mart expanded more than it should-- didn't manage growth well. K-Mart will be able to re-emerge.

[RedBloodedAmerican]

Why didn't the DOJ break up WalMart years ago? ;)

[RCW2001]

Its doubtful that they will survive mainly do to the answer to this one basis question:

If Kmart was to disappear, would you miss it? The resounding answer that can be heard is, "no, it would not be missed".

The only "good thing" about this filing is that it will not dump 250,000 people onto the unemployment rolls...immediately.

[Corporate Law]

They should. This gives them the ability to cut deadwood. Federated Department Stores filed Chapter 11 a decade ago, cut the deadwood, and ended up buying Macy's and The Broadway, and is now financially strong (recent Fingerhut debacle notwithstanding).

[bonfire]

Yes! I heard that there are some great sales going on.

[Clemenza]

FYI: The majority of the merchandise that Kmart cannot move or has removed from the shelves is at a wearhouse in Hialeah, Florida about ten minutes from where I live.

So COME ON DOWN I-75 to the Palmetto Expressway! There's going to be a fire sale like you wouldn't believe.

[RedBloodedAmerican]

The longer Walmart is around, the more I want Kmart to thrive, as much as it is.

[truthkeeper]

Thank you, that was very helpful.