Nation’s biggest department stores could run out of funds in a month: Goldman Sachs

[Krugminator2]

Nation’s biggest department stores could run out of funds in a month: Goldman Sachs

Major department stores like Kohl’s, Nordstrom and Macy’s could run out of capital within a month, according to a liquidity “stress test” published Thursday by Goldman Sachs. Other retailers like PVH (the parent company of Calvin Klein and Tommy Hilfiger), Gap and Victoria’s Secret parent company L Brands fared only a little better under the investment bank’s most extreme scenarios, with two months’ worth of liquidity available.

Retailers going under would have major implications for their landlords. Many retail real estate owners are already seeking relief on their mortgage payments.

This seems kind of problematic. https://therealdeal.com/2020/04/03/...-sachs/?utm_source=dlvr.it&utm_medium=twitter

I feel like people saying the economy should stay shut down for a month have no idea the tidal wave that could be coming.


I found this from JP Morgan study of small business in 2016 https://institute.jpmorganchase.com/institute/research/small-business/insight-cash-is-king.htm

Small businesses are the lifeblood of many communities and a critical driver of production, employment, and economic growth. They account for 99 percent of all business establishments in the United States, employ 48 percent of all US workers, are responsible for over 41 percent of net job creation, account for 45 percent of GDP, and produce 34 percent of all US exports.

Finding Three: The median small business holds 27 cash buffer days in reserve.

I originally thought the would be nothing. But closing the world economy for months is going to take years to recover from. Most businesses are highly levered and weren't equipped to have a total shutdown.

The number of people who will be killed by mass bankruptcy could leave the number of people killed by coronavirus in the dust.

 

[oyarde]

Once you shut businesses down for 3 weeks or so they are just like households . If they survive they are still out of cash .

 

[phill4paul]

Sales, baby! Yeah!

 

[Slave Mentality]

At least the hordes will be able to live in gutted buildings.