Monday, February 09, 2009

Some "Doomed" Companies

Yahoo has an article today that includes a listing of fifteen companies that may not survive the year. First off, while it is very possible that some of them may tank, I am fairly certain that there will also be some survivors on that list.

However there were some things on that list that surprised me.

Rite Aid has twice as many employees as Chrysler. Does that mean Rite Aid going down would be a bigger disaster than Chrysler going down. Hmmmm. I think that's kind of like asking What's worse? Getting your head cut off or your torso tore in half? Don't think I'd care for either one.

A lot of them I have never dealt with, though when I was a store manager in a mall, I did love Sbarros, which we had in the place. I have kind of figured that video rental chains would be going down soon because of stuff like Netflix, . . . shades of the buggy whip companies. Our local Blockbuster closed a few months ago, which was a shame because it was my local favorite.

Six Flags kind of surprised me, but I haven't been to an amusement park in a few years.

Some are unavoidable, but still something of a heartache for those who depend on them. Some will have a chance to survive and some of them will.

One thing I noticed over and over though is that a lot of them overexpanded. I think that's a lesson they need to take with them.

The link in the article, 5 missing pieces is also interesting. What he finds missing are ways for us to measure what is happening so we can act accordingly. He and I do not see eye-to-eye but he does make a few valid points. One question he fails to ask, and he really should be asking, is Is the bailout really the best way to go? I know we're supposed to just take their word for it that the answer is Yes, but to put it simply, when choosing between big government and big business, well it's a choice between two criminal syndicates and you're going to lose either way. When it comes to government, business, education, labor, religion, media etc. small is better.


Blogger Average American said...

Shoprat, I think this porkulus package will do much more harm than good. The big rush the halfrican is putting on it is bullshit. He just doesn't want it picked apart. If they took a little time, and cut it about in half, it might--just might--actually help.

1:02 AM  
Blogger Patrick Joubert Conlon said...

"One thing I noticed over and over though is that a lot of them overexpanded."

Yep, and in doing so they took on more debt than they could manage. This whole economic crisis boils down to more debt than equity.

1:27 AM  
Blogger Ducky's here said...

Six Flags kind of surprised me, but I haven't been to an amusement park in a few years.


You are apparently not alone.

12:12 PM  
Blogger Ducky's here said...

Looks like the first to go is Sirius Satellite Radio.

They should be declaring bankruptcy momentarily.

Guess the Howard Stern signing didn't work out for them.

11:53 AM  
Blogger Always On Watch said...

From that last link in the posting:

Reveal the dire economic forecasts behind the stimulus plan. Obama keeps saying that it’s going to get worse before it gets better, and that catastrophe will basically ensue without nearly a trillion dollars of new spending. So spell it out: How bad could it get? Part of this is the old political game of lowering expectations so it’s easier to claim success. But how much? What are Obama’s advisors telling him that’s so scary?

That the federal government might not be able to make payroll?

In his speech on Monday night, BHO mentioned the loss of revenue as taxes aren't getting paid.

8:38 PM  
Blogger Ducky's here said...

Would you rather have an irrational panic, AOW. The worst thing that can happen to a capital market is to lose trust.

You have to try to retain what trust you can to avoid a worse situation which then spirals in on itself.

11:46 AM  

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