Sears, the iconic American retailer, filed for Chapter 11 bankruptcy on Monday. Many analysts are treating Sears' fall as a cautionary tale about imprudent borrowing and failures to adapt — particularly in the face of e-commerce and rivals like Amazon. There is obviously a lot of truth in this.
But there's another piece of the narrative that deserves just as much attention: how Sears was stripped for parts by a Wall Street hedge fund.
If you track the long-term course of Sears' revenue and stock price, the problems didn't just set in with the arrival of Walmart and the big-box stores, or with Amazon and the rise of the internet economy. Instead, the tailspin really started with the arrival of a guy named Eddie Lampert and his hedge fund, ESL Investments.
Read Full Article »