Via Crain's, Business Insider explains in detail how Eddie Lampert has structured his financial holdings so that he may benefit more from Sears' destruction than from its success:
For all the problems in Sears stores, Lampert has set up his various businesses in a way that means he has other ways to gain no matter what happens to the company.
ESL holds a majority share of Sears, and that stake has lost three-quarters of its value just in the past few years — more than $1.5 billion since early 2015 alone.
But Lampert, through ESL, has loaned Sears more than $1.12 billion and promised an additional $679 million over the past two years to help keep the company afloat. In return, Sears pays origination fees and interest directly to ESL, and, by extension, Lampert. A recent shareholder complaint claims that Lampert and ESL made at least $19 million in fees and interest payments from a $400 million loan in 2014.
Lampert and ESL could potentially seize stores and inventory if Sears can't pay its bills. That $400 million loan, for instance, is backed by collateral of 25 stores valued at $500 million total.
Even if the company went bankrupt, Lampert wouldn't walk away empty-handed, according to bankruptcy experts and former executives.
How on earth did Sears' board allow this to happen? Oh, right—Lampert owns 54% of the company, and so appoints the board.
There are shareholder lawsuits, of course, though it's doubtful they'll succeed. And so the murder continues.
Since records began with Eisenhower's inauguration in 1953, no incoming president has had an approval rating below 50% at the start of his administration. Reagan and George HW Bush came in at 51%, and both managed to improve (to 68% and 56%, respectively) in the first 100 days. Even George W Bush, despite the taint surrounding his election, came in at 57% and inched up to 62% by April 2001.
And along comes Trump. A Quinnipac poll released today has him at 37%, and falling. As Josh Marshall puts it, "Trump, his agenda and his party are deeply unpopular. Indeed, Trump's gotten steadily more unpopular over the last four weeks. All of this tells us that political gravity still exists. Indeed, it is already shaping events on Capitol Hill."
For comparison, shortly before he left office under a pall of sex scandals and rampant corruption, Italy's Silvio Berlusconi polled between 33-35%. And immediately before the watershed UK election in 2010, the Labour Party under Gordon Brown polled around 30%. And in 2015, just before losing to Justin Trudeau, Canada's Stephen Harper polled around 33%.
In other words, Trump is coming into office approximately as popular as discredited and failing leaders of other modern democracies right before their defenestrations.
It'll be interesting to see if he notices.
You know, it's hard to feel sorry for anyone who invested in this charlatan's buildings, but still:
Two signs of a slowdown in Trump's signature building have emerged: a decline in sales of condos and a stack of unsold listings that is bigger than in competitive buildings.
At year-end, sales in the building were down from 2015, according to Gail Lissner, vice president of Appraisal Research Counselors, which tracks the downtown real estate market. There were 34 sales in the building in 2016, a drop of almost 40 percent from 2015's 56 sales, according to Lissner.
That's compared to an 11.3 percent increase in sales of all condos priced $650,000 and up, from 1,451 sales in 2015 to 1,616 sales in 2016, according to Midwest Real Estate Data. (Though many condos at Trump are priced in the multimillion-dollar range, the prices on currently listed condos start in the mid-$600,000s.)
The Trump building has the highest percentage of units on the resale market within a group of 10 downtown condo buildings all completed within several years of one another, according to a Crain's analysis.
Investors are out millions, and it seems directly attributable to Trump being Trump. Pity.
The last two days, I've been in meetings more than 7 hours each. I'm a little fried. Meanwhile, the following have popped up for me to read over the weekend:
I'm now off to the opera. Thence, perhaps, to sleep.
Now that Eddie Lampert has killed Sears almost with his bare hands, he's selling the best bits off. The Craftsman brand of tools is probably the most respected piece of the formerly-august company, so naturally it's the first to go:
Sears Holdings agreed to sell its Craftsman tool brand to Stanley Black & Decker for about $900 million, marking CEO Edward Lampert's third move in the past two weeks to prop up the beleaguered retailer with fresh sources of funding.
Under terms of the deal, Stanley will pay $525 million at closing and $250 million after three years, the companies said in a statement today. The buyer also will make annual payments on new Craftsman sales for 15 years. Separately, Sears announced plans to shutter 150 unprofitable stores in a bid to streamline the chain.
Craftsman has been part of Sears since 1927, when the retailer acquired the brand for $500. The tools debuted in the iconic Sears catalog two years later. By the 1940s, the brand benefited from a surge in power-tool sales. In 1981, President Jimmy Carter was given a Craftsman woodworking set as his farewell gift when he left the White House.
I really don't understand this guy. He's loaned Sears $500m of his own money. Is it ego? Incompetence? Or part of a master plan to make money by destroying Sears? We might never know.
The first brick-and-mortar Sears store, which closed this past fall, will become apartments and a giant liquor store by next year:
Chicago developer Springbank Capital Advisors has purchased the old Sears store in Ravenswood and plans to turn it into a $30 million apartment and retail complex, said David Trandel, chairman and chief executive of Springbank.
The building at 1900 W. Lawrence Avenue was closed last summer by Hoffman Estates-based Sears Holdings as the retail firm shuttered dozens of Sears and Kmart stores. The 40,434-square-foot store had been operated as a Sears store since November 1928.
The full development of apartments and retail will be 105,000 square feet. The $30 million in financing is provided by UC Funds of Boston, Trandel said. The developer plans to start removing asbestos this month, and begin construction in May with a summer 2018 completion.
Still, Eddie Lampert's murder of the Sears brand is criminal.
Welcome to another of my annual traditions: the stats dump.
In 2016:
- Traveling was way, way down over previous years. I only visited one foreign country (the UK) and took only 15 flights all year. That amounted to only 42,588 km, not enough to re-qualify for Platinum status for the first time since 2008.
- The Daily Parker had only 459 posts, down from 2015's 493, and the lowest since 2010. I was really, really busy this year. Posting suffered.
- Parker got 211 hours of walks, up 62 from 2015. So he did not suffer as much as the blog.
- Speaking of walks, I got 4,693,427 steps in 2016, beating 2015 by 29,266 steps—or 0.062%. That puts my 2016 daily average at 12,823.5, compared with 2015's 12,786.7. So, really, 37 steps a day. I think I can do better in 2017; we'll see. I still have yet to crack 50,000 steps in a day. Roll on spring.
- I'm still not reading as much as I used to. I started 23 books in 2016 (up from 2015's 21) but finished 15. If you're keeping count, yes, I dropped some books I started, and still have a book from 2015 to finish. Again, I hope to do better in 2017.
So here we go. Another year. This one could kill us all. Certainly we're all going to be a lot poorer. But maybe I'll read more books, take more steps, and walk Parker more hours.
(See 2015 and 2014 for comparison.)
I spent an hour and a half this morning dealing with an engine failure light on my car. Since I just got it back from having a repair done yesterday, the warning light ("Engine malfunction! Get to a dealer!") did not make me happy.
It turned out, the repair had completed a job started on a sensor wire previously by...rodents. And apparently, I'm not alone:
NBC 5 Responds found consumers nationwide who say they’ve experienced rodent-damages wires in several carmaker brands. It’s a problem so widespread, carmaker Honda now sells a tape aimed at deterring rodents from nibbling on wires. The tape, which mechanics can wrap over existing wires, is infused with capsaicin, the ingredient in spicy peppers. Honda calls the issue “an age-old” problem, and the tape a good solution for customers who live in areas where rodents like to nest in vehicles.
My car's manufacturer doesn't use soy-based insulation like Toyota does. Instead, they use peanut oil lubricants, which are just as yummy to area vermin.
Since I discovered the damage right after the shop last touched the engine, they fixed the broken wire for free.
Even though there are about 58 hours left in the year, I still have work to do. Meanwhile, a few things to read have crossed my RSS feeds:
OK, back to work.
From the Intertubes:
I'll also have some blog entries in January. December seems to have been pretty light.