Department store chain Mervyn's LLC is
fighting for survival after a lender pulled financing and some
vendors stopped shipments, the Wall Street Journal reported on
its website on Sunday.
The company has been trying to persuade vendors to send
shipments for the back-to-school season, but if they don't
agree, the chain may have to file for bankruptcy soon, the
paper said in a report citing unnamed sources.
A private investment group including Sun Capital Partners
Inc, Cerberus Capital Management, Lubert-Adler and Klaff
Partners LP bought Mervyn's from Target Corp (TGT.N) in 2004.
CIT Group Inc (CIT.N) stopped providing financing to the
retailer in the spring, the paper reported.
Mervyn's and CIT could not immediately be reached for
The Journal said the chain's private-equity buyers did not
stand to lose much from a liquidation of the company because of
the way they originally structured the deal.
(Reporting by Paritosh Bansal, Editing by Jacqueline Wong
The sputtering economy has asserted itself as the main concern for US voters less than four months ahead of presidential elections, and with an avalanche of alarming new data it appears unlikely that will change.
Against a backdrop of rising job losses, soaring energy and food costs and a deepening housing crisis, Democratic candidate Barack Obama and his Republican White House rival John McCain are each seeking to convince voters that theirs is the platform capable of restoring the country's prosperity.
But the souring of the economy has been so swift that it is uncertain the next president will be able to steer the badly listing ship back on course.
McCain has stated that permanent tax cuts are the best tonic for the battered economy, while Obama plans a series of massive infrastructure projects.
In the past week, the Labor Department reported US consumer prices up 1.1 percent in June to an annual pace of 5.0 percent, the sharpest rise in the consumer price index in 26 years.
Close to half a million Americans have lost their jobs since January. Home prices have tumbled 15 percent nationwide, and between two million to 2.5 million families are in danger of losing their homes to foreclosure.
"There's no single thing, there's no silver bullet" to fix the economy, Commerce Secretary Henry Paulson told CNN on Sunday.
"Right now we're going through a tough period. There is no doubt about it," he said, adding that with regard to soaring energy prices, "there's no doubt that that is a significant headwind, and it's going to prolong this slowdown."
According to US Federal Reserve Chairman Ben Bernanke, the US economy faces serious difficulties that are not expected to be resolved by the end of the year.
While crude oil prices fell more than 16 dollars per barrel in the past week, on worries over economic growth and slowing demand, fuel prices at the pump are 80 percent higher than at the same time last year.
Adding to the bleak picture is the precariousness of US stock market prices and financial institutions.
In recent days, long lines of people desperate to withdraw their money formed outside of failed California-based bank IndyMac.
In IndyMac's wake, 100-150 banks could shut their doors in the next 12 to 18 months, according to analyst estimates.
To build consumer confidence, McCain proposes making permanent the tax cuts initiated by President George W. Bush -- cuts that McCain himself had long opposed.
According to the Arizona senator, tax breaks should revitalize consumer purchasing power and corporate investment.
"If you believe you should pay more taxes, I am the wrong candidate ... Senator Obama is your man," McCain said recently.
He has also promised, if elected, to reduce the growing, nine-trillion dollar federal debt by 2013, at the end of his first mandate.
Obama describes the economic platform of his adversary as "essentially the Bush plan," adding that Americans cannot "afford four more years of George Bush policies."
For the Illinois senator it is not the rich who create wealth, but the work of America's large middle class, whom Obama has vowed to aid via a 500-dollar tax credit per person and fiscal incentives for small and medium-size enterprises.
He also hopes to reduce taxes for people earning less than 50,000 dollars per year while opposing tax breaks for those earning more than 250,000 per year, and has pledged to make quality healthcare available for everyone.
Obama is also aiming to adopt a new 50-billion-dollar "stimulous plan," on the model of the one negotiated by the White House and Congress a few months ago.
He has also urged government intervention to support delinguent borrowers, an idea McCain has rejected.
According to the independent Tax Policy Institute, the tax cuts proposed by McCain would raise the national debt by 4.3 trillion dollars from now to the end of 2018. Tax cuts proposed by Obama would raise it 3.3 trillion dollars.
Australian travel retailer Flight Centre
Ltd (FLT.AX) confirmed its full-year pretax profit will jump
about 40 percent, in line with its previous forecast, boosted
by healthy global sales, and forecast further growth in 2009.
Flight Centre said on Monday it expected to report a profit
of around A$212 million ($206 million) in the year to June 30.
It will announce its results on August 26.
In June, it had forecast a 38 percent increase in pretax
profit to A$210 million, compared with A$151.6 million the
previous year before a one-off gain.
It also reaffirmed its guidance for 10-15 percent profit
growth in fiscal 2009, thanks to a strong performance from its
Chief Financial Officer Shannon O'Brien said the businesses
in South Africa, New Zealand and the UK would drive growth,
while in Australia the strong dollar, robust job market and
availability of cheap international fares continued to
He said the restructuring of the recently acquired Liberty
Travel business in the U.S. has yet to gain traction, and
Liberty is not expected to contribute to profit growth this
(Reporting by Victoria Thieberger; editing by Jonathan