Today I Learned

This has become a common thing. It's assumed brick-and-mortar is dying due to Amazon and Temu and such. It's not; they've been on that path for a long time, and the companies that were going to die to it have already gone. However, it is a popular perception.

Private Equity gets to use the popular perception as a cover for shady ass shit.

Shopko was a midwestern chain of department stores. In their final years, they typically staffed like three people for the whole store. It's not as big as a Super Walmart or anything, but it's a sizable store in any case. They had one person on checkout, one in customer service, and one more running around the rest of the store. Maybe one or two more, but suffice it to say, it was deeply understaffed and it felt like it.

Behind the scenes, private equity had been taking out loans against the store's real estate, gave themselves big bonuses with that money, and left the company as a whole with unaffordable debt. Also, the money being taken out at the register for sales taxes wasn't actually being paid to the state.

Shopko was murdered. There is a standalone optical division that still operates, but the rest is gone.

I read something about the birth of these private Equity firms sometime in the late 70s or early '80s when a firm bought out this other productive firm and loaded them up with debt, paid themselves every which way they could, sold off any profitable parts of the company, then declared bankruptcy and stiffed everybody else walking away with a boatload of cash, unemployed workforces, and razed Pension funds.

We have been celebrating this type of behavior for decades now, Behavior I think exemplified in Monty Python's skits of the pirate building seizing the other buildings like it was a pirate ship.

Back to the good old corporate raiders like Lorenzo. For a while there we kept them on a leash. Now with the Land of No Consequences and leashes becoming meaningless these leeches are free to buy and pillage as they see fit. The housing market is gonna be destroyed next, wait until they start selling the homes off to shell companies and taking loans to pay for the deteriorating properties and property taxes (which trump has floated getting rid of to keep these hoarders afloat even longer).

It’s a PE firm. It’s what they do.

And now they want access to 401Ks

Yeah, the term "venture capitalist" is very negative in my mind because of how they destroy companies from the inside out to profit themselves. Fuck them.

That's why the Canadian toys r us is doing great.

Is this why the one in my area has been closed, but hasn't been turned into something else? It even still has the signage.

DOGE used this same model on the US government.

Capitalism is not rational

I live in the area the HQ used to be. I know a lot of middle management who got screwed very hard by these guys.

Everything they did was to line their pockets and destroy the company and leave creditors holding the bag. They should ban buying with loans, no taking loans against acquired companies for X years. The sale and leasing of assets back by the same owners stinks.

Toy R Us is still a thing in Canada, you can just go there and get your kid legos like its 2002

Same with Sears, right?

So private equity got their real estate for cheap. Might be intended

Also pensions, airlines, and restaurants.

I spent weeks waiting in line at my TRU for a switch and they sold out of it and every game every day. The day after I finally got mine and BOTW, they closed the store.

They were making hand over fist money when they closed

It still exists here in Japan for some reason!!