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Retailers want bailout, too

Posted Dec 24 2008, 06:39 AM by Douglas McIntyre
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Add to the list of the hundreds of companies and scores of industries that want part of the Obama bailout money the nation's largest retailers.

The National Retail Federation has proposed that there be tax-free periods for consumers to hit stores in March, July, and October.

According to a letter from the trade association, "NRF estimates that consumers could save nearly $20 billion. Based on the 112.4 million households in the United States, the figure would amount to almost $175 for the average family."

The proposal makes two assumptions that may not be valid and also undercuts the principle behind the new Obama stimulation plan. The next president is focused on investing as much as $850 billion in building the nation's infrastructure. That includes new broadband access, schools, roads, and medical technology. Tax rebate programs have never been a significant part of the plan.

The retail association also is dodging the issue of whether part of the problem in its industry is that there are too many stores. This leads to unnatural competition which may cause a level of discounting which hurts strong and weak operations alike. An artificial incentive to bring shoppers to retailers simply lengthens the time that operators which are too poorly financed to be viable stay in business and puts pressure on prices.

The other issue with a tax moratorium is that it limits what taxpayers can do with incentive which the government is giving them to enhance their financial positions. If a citizen wants to use that money to pay off his mortgage, he may be better off. It could keep homes out of foreclosure. It may also allow people who are behind on their credit cards to catch up. Sending people who are already leveraged into stores by offering tax incentives may actually be economically reckless.

The retail industry needs to be weeded out. Incentives to keep open stores which should fail makes a major economic problem worse.

Top Stocks blogger Douglas A. McIntyre is an editor at 24/7 Wall St.

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Comments

 

Top 5 Investment tips for the next 5 years.

1. The large can buried in the back yard.

2. The lil large can buried in the front yard.

3. The two lil bitty cans buried in the side yards.

4. The flattened can buried under your mattress.

THESE ARE PREDICATED ON THE FACT THAT YOU "STILL" HAV E A YARD.

The extent of the bailout is getting ridiculous.  While it is a nice gesture to assist ailing financial institutions, the problem is when it ends.  The system of giving handouts seems arbitrary and does not assist the average Joe and Jane person out there directly. There is no accountability either.  Paulson could give his grandmother a million and no one can say or do a thing about it.  It is like having an unlimited book of blank checks.   -  http://www.USANews.TV  

let me aks you dis- if you can save 12% tax on a pair of hundred dollar high top timberlands wouldn't you want to save the 30 bucks.  if Godbama wants talk cut a fool a break I say we do it up. Besides, you can"t yous food stamps on a pak a winstons.

Hey B U B,  you do realize that you're not supposed to be smoking.  It's not good for your health.  Also, if you really need a pack of smokes that bad, at only 4 or five bucks a pack, maybe you can take a loan out.  I hear the banks have a lot of money they're looking to lend.

If 12% on a $100 purchase actually saved $30, then Obama has more powers then I thought.  You might want to revisit your thrid grade math books.

Over the last few years I have been forced to work in ‘Retail’ — since retail jobs are about the only form of employment left in this country.  

What I have come to realize is that due to my retail employment — I do NOT spend as much as I use too.  — I have absolutely no desire to shop or spend money.  — The reason being is that my life has been completely consumed by my employer.

Working in retail translates to “No life of your own — No holidays allowed — No nights out — No weekend trips — No religion practiced — No family gatherings…” — Not to forget, that during the largest holiday shopping season — known in the retailer world as “Black Out” or “Peak” and to the consumer as Christmas — I am forced (mandatory) to work 60 to 70 hours per week.  — I’m too tired to shop; I don’t even go to the grocery store.

For the last 2 years I have stopped celebrating Christmas — I have wiped the event off my calendar.  No decorations; no holiday baking; no presents; no feast; not even a greeting card.  — On Christmas morning I awake and simply say “Happy Birthday Jesus” and then go about an ordinary day.  — This year, some of my family members have also joined my boycott of Christmas.

Every reason or purpose for me to spend money as a consumer has been taken away by the very entity which needs me as a consumer to spend money for its survival.

Well, my point is — if I am feeling this way and each & every year more and more people are employed in the field of retail — then the odds are that more and more people feel the same as I do and will also decrease their shopping/spending habits.

Maybe what is really needed is some form of ‘Human Rights’ protection for retail-employees.  — Retailers need to recognize that their employees are also their consumers — and if they burn-out their employees then they have burnt-out their consumers.

Retailers have become their own worst enemy — they employ consumers and then forget they are consumers.

Maybe instead of a financial bailout what would actually help retailers are a few labor laws which say — No mandatory 60 & 70 hour work-weeks; No mandatory observance of ‘Black Friday’; Mandatory 2 week-ends per month off for every employee….  

A little reminder to ‘Retailers’ that their employees are not only human; yet also their customers — start caring and show a little respect.

No more bailouts, please.

Doesn't anyone realize this money will never be paid back. Stop the bail-outs someone needs to put a stop to this, we will never be able in our lives or our childrens lives beable to pay back the trillions we owe the dollar will become worthless. Let the companys go under is it our responsibility as tax payers to help these companies out? I say NO! Who's listening to us? Its sure not the governement I thought this was a democracy!

I do not blame the retailers for jumping on the band wagon.  The banks and financial institutions have already shown their true reason for the bailout, Greed has taken ahold of them just as it has everyone else.  If Uncle Sugar would give me billions of dollars and tell me to use it as I see fit because there are no strings attached to the loan, hell you do not even have to account for how you use the money, then the retailers would be plain dumb for not wanting some of that action.

DEAR UNCLE SAM

ATTN; TREASURY DEPARTMENT.

THE REASON FOR THIS LETTER IS TO INQUIRE ON HOW TO APPLY FOR ONE OF YOUR BAILOUTS.  I CAN NOT AFFORD TO PAY FOR THE HOUSE THAT I PAID TOO MUCH FOR IN THE FIRST PLACE.  I UNDERSTAND THAT YOU WOULD TAKE A LOSS IN HELPING ME, BUT I DO NOT THINK IT WILL BE AS BIG A LOSS AS THE MONEY YOU HAVE JUST GIVEN AWAY TO THE FINANCIAL EXPERTS THAT GOT US HERE IN THE FIRST TIME.   YES, LIKE THEM, I GOT MYSELF IN A FIX, BUT UNLIKE THEM I REALLY DID NOT UNDERSTAND WHAT I WAS DOING.  CAN YOU PLEASE HELP ME, AFTER YOU GAVE ALL THAT MONEY AWAY TO THEM

THANK YOU

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