Retail Apocalypse: Why Are Major Retail Chains All Over America Collapsing?

[Red James Cash]

Retail Apocalypse: Why Are Major Retail Chains All Over America Collapsing?

Michael Snyder
Economic Collapse
Feb 18, 2013

If the economy is improving, then why are many of the largest retail chains in America closing hundreds of stores? When I was growing up, Sears, J.C. Penney, Best Buy and RadioShack were all considered to be unstoppable retail powerhouses. But now it is being projected that all of them will close hundreds of stores before the end of 2013. Even Wal-Mart is running into problems. A recent internal Wal-Mart memo that was leaked to Bloombergdescribed February sales as a “total disaster”. So why is this happening? Why are major retail chains all over America collapsing? Is the “retail apocalypse” upon us? Well, the truth is that this is just another sign that the U.S. economy is falling apart right in front of our eyes. Incomes are declining, taxes are going up, government dependence is at an all-time high, and according to the Bureau of Labor Statistics the percentage of the U.S. labor force that is employed has been steadily falling since 2006. The top 10% of all income earners in the U.S. are still doing very well, but most U.S. consumers are either flat broke or are drowning in debt. The large disposable incomes that the big retail chains have depended upon in the past simply are not there anymore. So retail chains all over the United States are now closing up unprofitable stores. This is especially true in low income areas.

When you step back and take a look at the bigger picture, the rapid decline of some of our largest retail chains really is stunning.

It is happening already in some areas, but soon half empty malls and boarded up storefronts will litter the landscapes of cities all over America.

Just check out some of these store closing numbers for 2013. These numbers are from a recent Yahoo Finance article…

Best Buy

Forecast store closings: 200 to 250

Sears Holding Corp.

Forecast store closings: Kmart 175 to 225, Sears 100 to 125

J.C. Penney

Forecast store closings: 300 to 350

Office Depot

Forecast store closings: 125 to 150

Barnes & Noble

Forecast store closings: 190 to 240, per company comments

Gamestop

Forecast store closings: 500 to 600

OfficeMax

Forecast store closings: 150 to 175

RadioShack

Forecast store closings: 450 to 550

The RadioShack in a nearby town just closed up where I live. This is all happening so fast that it is hard to believe.

But the truth is that those store closings are not the entire story. When you dig deeper you find a lot more retailers that are in trouble.

For example, Blockbuster recently announced that this year they will be closing about 300 stores and eliminating about 3,000 jobs.

Toy manufacturer Hasbro recently announced that they will be reducing the size of their workforce by about 10 percent.

Even Wal-Mart is going through a tough stretch right now. According to documents that were leaked to Bloomberg, Wal-Mart is having an absolutely disastrous February…

Wal-Mart Stores Inc. had the worst sales start to a month in seven years as payroll-tax increases hit shoppers already battling a slow economy, according to internal e-mails obtained by Bloomberg News.

“In case you haven’t seen a sales report these days, February MTD sales are a total disaster,” Jerry Murray, Wal- Mart’s vice president of finance and logistics, said in a Feb. 12 e-mail to other executives, referring to month-to-date sales. “The worst start to a month I have seen in my ~7 years with the company.”

So what in the world is going on here?

The mainstream media continues to proclaim that we are experiencing a robust “economic recovery”, but at the same time there are a whole host of indications that things are continually getting worse.

Even global cell phone sales actually declined slightly in 2012. That was the first time that has happened since the last recession.

Perhaps it is time that we faced the truth. The middle class is shrinking, incomes are declining and there are not nearly as many jobs as there used to be.

Mort Zuckerman pointed this out in a recent article in the Wall Street Journal…

The U.S. labor market, which peaked in November 2007 when there were 139,143,000 jobs, now encompasses only 132,705,000 workers, a drop of 6.4 million jobs from the peak. The only work that has increased is part-time, and that is because it allows employers to reduce costs through a diminished benefit package or none at all.

So how can the mainstream media be talking about how “good” things are if we still have 6.4 million fewer jobs than we had back in November 2007?

And sadly, things may soon be getting a lot worse. If Congress does not do anything about the “sequester”, millions of federal workers may shortly be facing some very painful furloughs according to CNN…

Federal workers could start facing furloughs as early as April, according to federal agencies trying to prepare for the worst.

Unless Congress steps in, some $85 billion in massive spending reductions will hit the federal government, doling out furloughs to much of the nation’s 2.1 million federal workforce, experts say.

If you still live in an area of the country where the stores and the restaurants are booming, you should be very thankful because that is not the reality for most of the country.

I often write about the stunning economic decline of major cities such as Detroit, but there are huge sections of rural America that are in even worse shape than Detroit in many ways.

For example, many Indian reservations all over America have been shamefully neglected by the federal government and have become hotbeds for crime, drugs and poverty.

Business Insider recently profiled the Wind River Indian reservation in western Wyoming. The following is a brief excerpt from thatoutstanding article…

The Wind River Indian Reservation is not an easy place to get to, but I had to see it for myself.

Thirty-five-hundred square miles of prairie and mountains in western Wyoming, the reservation is home to bitter ancestral enemies: the Eastern Shoshone and Northern Arapaho tribes.

Even among reservations, it’s renowned for brutal crime, widespread drug use, and legal dumping of toxic waste.

You can see some amazing photos of the Wind River Indian reservationright here.

It is hard to believe that there are places like that in America, but the truth is that conditions like that are spreading to more U.S. communities with each passing day.

We are a nation that is in an advanced state of decline. But as long as the financial markets are okay, our leaders don’t seem too concerned about the suffering that everyone else is going through.

In fact, former Federal Reserve Chairman Alan Greenspan essentially admitted as much during a recent interview with CNBC. The following is how a Zero Hedge article summarized that interview…

Starting at around 1:50, Greenspan states the odds of sequester occurring are very high – in fact, the playdough-faced ex-Chair-head notes, “I find it very difficult to find a scenario in which [the sequester] doesn’t happen” But when asked how this will affect the economy, Awkward Alan is unusually clearly spoken - “the issue is how does it affect the stock market.”

While not so many of our leaders have taken the path to direct truthiness, Greenspan somewhat shocks a Botox’d and babbling Bartiromo when he admits “the stock market is the key player in the game of economic growth.”

Bartiromo shifts uncomfortably in her seat, strokes her imaginary beard and stares blankly as Greenspan explains that while the sequester will have a real effect on the real economy, “if the stock market can hold up through this, then the effect will be rather minor.”

Do you see?

As long as the stock market is moving higher they think that everything is just fine and dandy.

And the Obama administration?

They continue to pursue the same policies that got us into this mess.

Their idea of “economic reform” is to threaten to sue businessesthat do not hire ex-convicts.

And of course now that Obama has been re-elected he is putting a tremendous amount of effort into “stimulating the economy”.

For example, he spent this weekend golfing in Florida, and the Obamas recently spent about 20 million taxpayer dollars vacationing in Hawaii.

Meanwhile, the U.S. economy is getting worse with each passing day.

If you doubt that economic conditions are getting worse, please read this article: “Show This To Anyone That Believes That ‘Things Are Getting Better’ In America“.

When you look at the cold, hard numbers, it is undeniable what is happening to America.

And our leaders are not doing anything to fix our problems. In fact, most of the time they are just making things worse.

So buckle up and get prepared. We are in for very bumpy ride, and this is only just the beginning.

 

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[B1u3Dr4g0n1]

This is true, but if you listen to what we are told all is well....just watch the State of the Union speech..LOL

 

[hursst]

These stores are going out of business because you can 1) buy their stuff online from your house instead of going out 2) Buying online is cheaper 3) Usually, there are no sales taxes. This is just technology changing things; it's sad to see some of these stores leave, but you can't stop "progress."

 

[B1u3Dr4g0n1]

These stores are going out of business because you can 1) buy their stuff online from your house instead of going out 2) Buying online is cheaper 3) Usually, there are no sales taxes. This is just technology changing things; it's sad to see some of these stores leave, but you can't stop "progress."

When stores close, people lose their jobs, there is NO " progress " there. We cant keep up with what gets imported from slave labor mills and never will...

 

[jerseyben]

These stores are going out of business because you can 1) buy their stuff online from your house instead of going out 2) Buying online is cheaper 3) Usually, there are no sales taxes. This is just technology changing things; it's sad to see some of these stores leave, but you can't stop "progress."

Bingo.

 

[hvacker]

I don't agree with most of this post. Example: Block Busters failed to understand that movie rentals were going to be done differently like mail and streaming. They didn't change fast enough like Woolworth, Ben Franklin etc. Except for Mort Zukerman, I wouldn't want to get economic news from main stream media.
I live in Indian country and one thing about the tribes that's never understood is they are NOT white America. The BIA is still often trying to integrate them on one hand and keep them dependent on the other. I've also been to Wind River. And Pine Ridge, and the Navajo Nation and Zuni, and many of the pueblos. It's not an ez life but the BIA often makes it worse. That and FBI intrusion.

In a way the Mom & Pop retailing is returning. Many go to the brick and mortar store just to check stuff out then go on line to shop price. The retail stores have a huge disadvantage and it will get worse. For those wanting to get into retail it's never been cheaper.

If your looking for the Government to save the economy, it doesn't work that way. The economy is privatized. The Banks own the money. When things get out of hand for the Banks there are just a few things the Gov can do to get past the crisis. In the end the Banks and others that affect the economy have to pick themselves up. So many want to blame Obama, Bush, even Clinton but there is little they can do with someone Else's money.
The idea of Government intervention seems to be epidemic.

 

[B1u3Dr4g0n1]

If we was to stop importing so much into this country...WE as a country would have to make our own goods, which in turn would make people work, which creates jobs...but Big Government wants global control to drag every common person down to the same level, which we cannot keep up with...that is a fact...doing very little research will bring this to light.

 

[0121stockpicker]

If we was to stop importing so much into this country...WE as a country would have to make our own goods, which in turn would make people work, which creates jobs...but Big Government wants global control to drag every common person down to the same level, which we cannot keep up with...that is a fact...doing very little research will bring this to light.

Has nothing to do with the government - it's the individual consumer who is to blame. Every consumer has the capitalist/American right to buy whatever they want. If they choose to by and item that is foreign made but is cheaper than a comparable "American made" product. Pure and simple. Want it all made in America - fine. Watch the price of your cloths goes up 5 fold, consumer electronics go up 10 fold etc etc. you want unionized American labor picking your food instead of off the books illegal immigrants - expect to pay $20 for a head if lettuce, etc, etc. a bit of exaggeration but you get the point protectionism, tariffs, etc, etc DO NOT improve a nations economy and its people's standard of living. This has been tried and failed lots and lots of times. Best thing one can do IMO - produce uour own, buy local and be happy with fewer material goods, don't give in to our throwaway society. But then again, many might say those are downright "unamerican views"!!

 

[onfire]

I think the long term leases on some of these giants has run it's course Some if not most have new owners who bought large malls etc. and now expect higher rental agreements. It's like trying to buy a farm today grandma and grandpa only had a small nut to crack now you come in with a nut 50 times what needed to run that place. Have you noticed how many True value hardware stores are closing.? Their being taken over buy the big boxer's. We can always count on Taco and curry stores to fill the void.

 

[onfire]

Has nothing to do with the government - it's the individual consumer who is to blame. Every consumer has the capitalist/American right to buy whatever they want. If they choose to by and item that is foreign made but is cheaper than a comparable "American made" product. Pure and simple. Want it all made in America - fine. Watch the price of your cloths goes up 5 fold, consumer electronics go up 10 fold etc etc. you want unionized American labor picking your food instead of off the books illegal immigrants - expect to pay $20 for a head if lettuce, etc, etc. a bit of exaggeration but you get the point protectionism, tariffs, etc, etc DO NOT improve a nations economy and its people's standard of living. This has been tried and failed lots and lots of times. Best thing one can do IMO - produce uour own, buy local and be happy with fewer material goods, don't give in to our throwaway society. But then again, many might say those are downright "unamerican views"!!

Next time you go food shopping ask the produce guy were almost all the fresh stuff comes from. You'll be surprised on how much comes from foreign countries. We don't need pickers in a corn field. So where are all those off the books working? You've been fed by CNN.

 

[0121stockpicker]

Next time you go food shopping ask the produce guy were almost all the fresh stuff comes from. You'll be surprised on how much comes from foreign countries. We don't need pickers in a corn field. So where are all those off the books working? You've been fed by CNN.

Completely depends on the season and the food. California still the largest fruit / veg producer in the world.

But completely agree a ton a food comes from overseas. Even some of the "organic" foods come from places where organic does not come to mind.

My old company helped to raise funds for companies like united natural foods and whole foods market so know a little but something beyond what's on the tv.

Always worth asking before jumping to conclusions what people know and don't know. Lots if interesting stuff to be learned from others out there. Best.

 

[AdDicted2Ag]

Wow... This is just absurd... First of all, I am a libertarian and against large government just as much as the next guy, but you guys seriously need to chill out and realize that this is happening everywhere in the world and has absolutely nothing to do with the government.. This is a result of technological growth.. plain and simple.... If these businesses cannot develop a way to adapt with the changes in technology, then they are putting the nails in their own coffin.. Why would I go out of my way and travel to a best buy, Barnes and noble, Office Depot or any of the other businesses you mentioned and pay 25% more for a product, when I can sit at home, buy it for much cheaper and have it delivered to my front door? It makes absolutely no sense whatsoever.. You can argue that one should oppose this in order to provide jobs for people in this country, but I promise you, the world is heading in this direction whether you like it or not.. This is a technological era we are living in and you are simply dragging your feet.. The days of Storefront shopping are dwindling fast.. You absolutely cannot stop evolution.. Whether it is the evolution of ideas, civil liberties or technological growth, the world is heading in this direction and at some point in your life you are going to have to come to grips with reality..

 

[B1u3Dr4g0n1]

Wow... This is just absurd... First of all, I am a libertarian and against large government just as much as the next guy, but you guys seriously need to chill out and realize that this is happening everywhere in the world and has absolutely nothing to do with the government.. This is a result of technological growth.. plain and simple.... If these businesses cannot develop a way to adapt with the changes in technology, then they are putting the nails in their own coffin.. Why would I go out of my way and travel to a best buy, Barnes and noble, Office Depot or any of the other businesses you mentioned and pay 25% more for a product, when I can sit at home, buy it for much cheaper and have it delivered to my front door? It makes absolutely no sense whatsoever.. You can argue that one should oppose this in order to provide jobs for people in this country, but I promise you, the world is heading in this direction whether you like it or not.. This is a technological era we are living in and you are simply dragging your feet.. The days of Storefront shopping are dwindling fast.. You absolutely cannot stop evolution.. Whether it is the evolution of ideas, civil liberties or technological growth, the world is heading in this direction and at some point in your life you are going to have to come to grips with reality..

Our government is paying over sea banks, but then taxing us for a debt WE didnt create....there is no getting around that being a 100% fact..now in return that makes the comom people have less money which in turn lets them spend less, but still want the same, so buying things from other countries are cheaper..FACT which inturn is dragging this country down...it is a visious circle that a lot of people just dont understand.

 

[0121stockpicker]

Wow... This is just absurd... First of all, I am a libertarian and against large government just as much as the next guy, but you guys seriously need to chill out and realize that this is happening everywhere in the world and has absolutely nothing to do with the government.. This is a result of technological growth.. plain and simple.... If these businesses cannot develop a way to adapt with the changes in technology, then they are putting the nails in their own coffin.. Why would I go out of my way and travel to a best buy, Barnes and noble, Office Depot or any of the other businesses you mentioned and pay 25% more for a product, when I can sit at home, buy it for much cheaper and have it delivered to my front door? It makes absolutely no sense whatsoever.. You can argue that one should oppose this in order to provide jobs for people in this country, but I promise you, the world is heading in this direction whether you like it or not.. This is a technological era we are living in and you are simply dragging your feet.. The days of Storefront shopping are dwindling fast.. You absolutely cannot stop evolution.. Whether it is the evolution of ideas, civil liberties or technological growth, the world is heading in this direction and at some point in your life you are going to have to come to grips with reality..

Completely agree, though things are tilted a bit in the internet (or catalog) favor as there are for the most part no tax on internet orders. It definitely doesnt make that much of a diff and im shocked the state govs havnt started taxing internet transactions yet.

You wouldn't believe how many in the investment community completely missed some of these huge tech driven changes. Think also what the Internet did to the newspaper biz!!

 

[AdDicted2Ag]

Our government is paying over sea banks, but then taxing us for a debt WE didnt create....there is no getting around that being a 100% fact..now in return that makes the comom people have less money which in turn lets them spend less, but still want the same, so buying things from other countries are cheaper..FACT which inturn is dragging this country down...it is a visious circle that a lot of people just dont understand.

You aren't really making any sense in that statement.. Can you compose your argument a little more clearly and provide some facts to back up what you are saying? I am not being rude, I just literally don't understand what you are even talking about.. Inflation? Currency exchange?

 

[B1u3Dr4g0n1]

You aren't really making any sense in that statement.. Can you compose your argument a little more clearly and provide some facts to back up what you are saying? I am not being rude, I just literally don't understand what you are even talking about.. Inflation? Currency exchange?

I gave up spoon feeding people a while back, look up what I said. Im not being rude either but, this problem is deeper than your willing to dig to look...

 

[smokeythecat]

The economy is not getting better. When the vacant houses around here have new owners, and I see a flock of new cars on the road instead of older and older cars, then I'll believe the economy is getting better.

 

[onfire]

Wow... This is just absurd... First of all, I am a libertarian and against large government just as much as the next guy, but you guys seriously need to chill out and realize that this is happening everywhere in the world and has absolutely nothing to do with the government.. This is a result of technological growth.. plain and simple.... If these businesses cannot develop a way to adapt with the changes in technology, then they are putting the nails in their own coffin.. Why would I go out of my way and travel to a best buy, Barnes and noble, Office Depot or any of the other businesses you mentioned and pay 25% more for a product, when I can sit at home, buy it for much cheaper and have it delivered to my front door? It makes absolutely no sense whatsoever.. You can argue that one should oppose this in order to provide jobs for people in this country, but I promise you, the world is heading in this direction whether you like it or not.. This is a technological era we are living in and you are simply dragging your feet.. The days of Storefront shopping are dwindling fast.. You absolutely cannot stop evolution.. Whether it is the evolution of ideas, civil liberties or technological growth, the world is heading in this direction and at some point in your life you are going to have to come to grips with reality..

Here's one problem I have with your new age thinking I bought myself a new chair over 3k Now your right it cost 22 hundred on the net. I took a net price back to the store and showed the owner that price. He knocked off 5 hundred but brought up the point if for ever reason something went wrong with it who's going to fix it? He was right 2 years later a malfunction in the operating system failed they were their the next day (No charge) In my case I enjoy talking to people from the U.S. Even if it cost's me a few bucks. Shop local and save the country. (Even if it;s made in Bumb f Egypt.) Won't it be fun when every one is sitting in their home and nobody's working and then figure out how they are going to pay for it. (Opps there's always the king's stash)

 

[jerseyben]

Here's one problem I have with your new age thinking I bought myself a new chair over 3k Now your right it cost 22 hundred on the net. I took a net price back to the store and showed the owner that price. He knocked off 5 hundred but brought up the point if for ever reason something went wrong with it who's going to fix it? He was right 2 years later a malfunction in the operating system failed they were their the next day (No charge) In my case I enjoy talking to people from the U.S. Even if it cost's me a few bucks. Shop local and save the country. (Even if it;s made in Bumb f Egypt.) Won't it be fun when every one is sitting in their home and nobody's working and then figure out how they are going to pay for it. (Opps there's always the king's stash)

Not trying to be rude in any way but please help me understand something you said... What kind of chair costs $3k and has an operating system?

 

[onfire]

Melbourne glider recliner with ottoman Retail 3750.00. top grain leather. nice chair.