Connect with us

Uncategorized

The Washington Post Tells Us Low Income Families Are Especially Hard Hit by Inflation but the Census Bureau Says Their Homeownership Rate is Up: Who to Believe?

It is getting almost as bad as propaganda from an authoritarian regime. We keep hearing major news outlets tell us that inflation is really whacking lower…

Published

on

It is getting almost as bad as propaganda from an authoritarian regime. We keep hearing major news outlets tell us that inflation is really whacking lower income families. The Washington Post did it yesterday in an editorial demanding more rate hikes from the Fed to throw people out of work.

Lower income people, like everyone else, are paying more for food, gas, and rent. The argument is that these items are a larger share of the budget of lower income people, so they are hit harder by inflation than higher income households.

The problem with telling this simple story is that wages have been growing most rapidly at the bottom end of the wage distribution, substantially outpacing inflation since the start of the pandemic. Also, in a tight labor market, it is likely that more people are working in many households. They are also more likely to be able to find a job that has lower commuting costs or might allow them to work part-time to deal with child care or family needs.

One way to assess how these things balance out is to look at what has happened to homeownership rates. More homeownership is not always better, as some of us warned during the housing bubble years, but people who have the option to buy a home generally choose to do so.

Contrary to the propaganda coming from the media, homeownership rates have actually risen rapidly since the pandemic for households with incomes below the median as shown below. (The big jump in 2020, which was partially reversed, is likely to due to a skewing in responses, as the pandemic sent response rates plummeting.)

 

Source: Census Bureau (Table 8).

 

Homeownership rates have also risen for Black and Hispanic households and for those headed by someone under age 35. It is more than a bit bizarre than the media have been almost uniformly insisting that these are horrible times for lower income people in spite of data that say the opposite.

 

The post The Washington Post Tells Us Low Income Families Are Especially Hard Hit by Inflation but the Census Bureau Says Their Homeownership Rate is Up: Who to Believe? appeared first on Center for Economic and Policy Research.

Read More

Continue Reading

Uncategorized

Apparel Retailer Express Moving Toward Bankruptcy

Apparel Retailer Express Moving Toward Bankruptcy

During the company’s last earnings call in November, recently appointed CEO Stewart Glendinning…

Published

on

Apparel Retailer Express Moving Toward Bankruptcy

During the company’s last earnings call in November, recently appointed CEO Stewart Glendinning acknowledged the company made some missteps: Among other factors, there was a misalignment between its assortment and customer demand, Retail Dive's Nate Delesline reports.

An Express storefront at King of Prussia mall in Pennsylvania. The retailer said this week that it plans to initiate an international brand expansion starting next year

Express took a hit during the pandemic as its core offering — business casual — fell out of favor as work-from-home surged.

“Unfortunately, my previous assessment of Express’ fragile financial situation leading to a possible bankruptcy due to declining revenue, gross margin profits and ballooning debt of $280 million is a foregone conclusion,” Shawn Grain Carter, a retail industry consultant and professor at the Fashion Institute of Technology at the State University, said in an email to Retail Dive. “With high-interest rates, the retail company must decide between the ‘lesser of two evils.’ Moreover, until they fix the waning consumer demand for their merchandise and elevate the brand and product mix, financial wizardry will not resolve their retail woes.”

Over the past several years, the company has undergone a number of changes as it works to improve its performance. Last January, WHP Global closed on a strategic partnership with Express. The two entities formed an intellectual property joint venture under which WHP contributed $235 million for a 60% stake, while Express retained the remaining 40%. The two entities in November announced plans to expand Express internationally, including in Indonesia and Paraguay, and grow its presence in Central America and Mexico. 

And after the New York Stock Exchange warned of a potential delisting in late March, Express executed a 1-for-20 reverse stock split, which decreased outstanding shares to 3.7 million from 74.9 million. That stock split enabled Express to regain listing compliance with the New York Stock Exchange. Around the same time, Express said it planned to cut 150 jobs by the end of the third quarter.

The company also expanded its portfolio last year through a deal with WHP to acquire Bonobos from Walmart for $75 million. That acquisition helped guide the retailer to a 5% year-over-year uptick in Q3 net sales to $454.1 million from $434.1 million a year earlier. However, comparable sales for Express stores and e-commerce fell 4% and net loss grew to $36.8 million from $34.4 million in the year-ago period. Inventory was also up 14% for the quarter, rising to nearly $481 million from $422.7 million a year earlier. 

“Express has the right building blocks in place with a strong portfolio of brands, a high-potential partnership with WHP and a premier omnichannel platform,” Glendinning said in the earnings announcement. “Our efforts to unlock our full potential and improve our performance are already underway.”

The apparel retailer in late November lowered its full-year 2023 guidance, now expecting net sales to be between $1.84 billion and $1.87 billion, with Bonobos driving $150 million in net sales. 

Finally, on Friday, Bloomberg reported that at least one lender to Express has approached the retailer to put aside a pool of money for expenses tied to a potential future bankruptcy filing.

A demand to set aside so-called cash reserves, if enforced, could push Express into Chapter 11 as it would eat into limited liquidity available for necessary payments to vendors, landlords and other parties.

Creditors have been growing increasingly antsy and considering whether to push the company to file for bankruptcy, Bloomberg previously reported.

Express, which is burning through a short supply of cash as it attempts to fix troubled operations, is looking to avoid any move to fund reserves for as long as possible, other people familiar with the matter said. The retailer lost over $150 million in three quarters through late October as it faced an escalating competitive threat from fast-fashion rivals.

Tyler Durden Fri, 02/23/2024 - 18:00

Read More

Continue Reading

Uncategorized

Apparel Retailer Express Moving Toward Bankruptcy

Apparel Retailer Express Moving Toward Bankruptcy

During the company’s last earnings call in November, recently appointed CEO Stewart Glendinning…

Published

on

Apparel Retailer Express Moving Toward Bankruptcy

During the company’s last earnings call in November, recently appointed CEO Stewart Glendinning acknowledged the company made some missteps: Among other factors, there was a misalignment between its assortment and customer demand, Retail Dive's Nate Delesline reports.

An Express storefront at King of Prussia mall in Pennsylvania. The retailer said this week that it plans to initiate an international brand expansion starting next year

Express took a hit during the pandemic as its core offering — business casual — fell out of favor as work-from-home surged.

“Unfortunately, my previous assessment of Express’ fragile financial situation leading to a possible bankruptcy due to declining revenue, gross margin profits and ballooning debt of $280 million is a foregone conclusion,” Shawn Grain Carter, a retail industry consultant and professor at the Fashion Institute of Technology at the State University, said in an email to Retail Dive. “With high-interest rates, the retail company must decide between the ‘lesser of two evils.’ Moreover, until they fix the waning consumer demand for their merchandise and elevate the brand and product mix, financial wizardry will not resolve their retail woes.”

Over the past several years, the company has undergone a number of changes as it works to improve its performance. Last January, WHP Global closed on a strategic partnership with Express. The two entities formed an intellectual property joint venture under which WHP contributed $235 million for a 60% stake, while Express retained the remaining 40%. The two entities in November announced plans to expand Express internationally, including in Indonesia and Paraguay, and grow its presence in Central America and Mexico. 

And after the New York Stock Exchange warned of a potential delisting in late March, Express executed a 1-for-20 reverse stock split, which decreased outstanding shares to 3.7 million from 74.9 million. That stock split enabled Express to regain listing compliance with the New York Stock Exchange. Around the same time, Express said it planned to cut 150 jobs by the end of the third quarter.

The company also expanded its portfolio last year through a deal with WHP to acquire Bonobos from Walmart for $75 million. That acquisition helped guide the retailer to a 5% year-over-year uptick in Q3 net sales to $454.1 million from $434.1 million a year earlier. However, comparable sales for Express stores and e-commerce fell 4% and net loss grew to $36.8 million from $34.4 million in the year-ago period. Inventory was also up 14% for the quarter, rising to nearly $481 million from $422.7 million a year earlier. 

“Express has the right building blocks in place with a strong portfolio of brands, a high-potential partnership with WHP and a premier omnichannel platform,” Glendinning said in the earnings announcement. “Our efforts to unlock our full potential and improve our performance are already underway.”

The apparel retailer in late November lowered its full-year 2023 guidance, now expecting net sales to be between $1.84 billion and $1.87 billion, with Bonobos driving $150 million in net sales. 

Finally, on Friday, Bloomberg reported that at least one lender to Express has approached the retailer to put aside a pool of money for expenses tied to a potential future bankruptcy filing.

A demand to set aside so-called cash reserves, if enforced, could push Express into Chapter 11 as it would eat into limited liquidity available for necessary payments to vendors, landlords and other parties.

Creditors have been growing increasingly antsy and considering whether to push the company to file for bankruptcy, Bloomberg previously reported.

Express, which is burning through a short supply of cash as it attempts to fix troubled operations, is looking to avoid any move to fund reserves for as long as possible, other people familiar with the matter said. The retailer lost over $150 million in three quarters through late October as it faced an escalating competitive threat from fast-fashion rivals.

Tyler Durden Fri, 02/23/2024 - 18:00

Read More

Continue Reading

Uncategorized

Apparel Retailer Express Moving Toward Bankruptcy

Apparel Retailer Express Moving Toward Bankruptcy

During the company’s last earnings call in November, recently appointed CEO Stewart Glendinning…

Published

on

Apparel Retailer Express Moving Toward Bankruptcy

During the company’s last earnings call in November, recently appointed CEO Stewart Glendinning acknowledged the company made some missteps: Among other factors, there was a misalignment between its assortment and customer demand, Retail Dive's Nate Delesline reports.

An Express storefront at King of Prussia mall in Pennsylvania. The retailer said this week that it plans to initiate an international brand expansion starting next year

Express took a hit during the pandemic as its core offering — business casual — fell out of favor as work-from-home surged.

“Unfortunately, my previous assessment of Express’ fragile financial situation leading to a possible bankruptcy due to declining revenue, gross margin profits and ballooning debt of $280 million is a foregone conclusion,” Shawn Grain Carter, a retail industry consultant and professor at the Fashion Institute of Technology at the State University, said in an email to Retail Dive. “With high-interest rates, the retail company must decide between the ‘lesser of two evils.’ Moreover, until they fix the waning consumer demand for their merchandise and elevate the brand and product mix, financial wizardry will not resolve their retail woes.”

Over the past several years, the company has undergone a number of changes as it works to improve its performance. Last January, WHP Global closed on a strategic partnership with Express. The two entities formed an intellectual property joint venture under which WHP contributed $235 million for a 60% stake, while Express retained the remaining 40%. The two entities in November announced plans to expand Express internationally, including in Indonesia and Paraguay, and grow its presence in Central America and Mexico. 

And after the New York Stock Exchange warned of a potential delisting in late March, Express executed a 1-for-20 reverse stock split, which decreased outstanding shares to 3.7 million from 74.9 million. That stock split enabled Express to regain listing compliance with the New York Stock Exchange. Around the same time, Express said it planned to cut 150 jobs by the end of the third quarter.

The company also expanded its portfolio last year through a deal with WHP to acquire Bonobos from Walmart for $75 million. That acquisition helped guide the retailer to a 5% year-over-year uptick in Q3 net sales to $454.1 million from $434.1 million a year earlier. However, comparable sales for Express stores and e-commerce fell 4% and net loss grew to $36.8 million from $34.4 million in the year-ago period. Inventory was also up 14% for the quarter, rising to nearly $481 million from $422.7 million a year earlier. 

“Express has the right building blocks in place with a strong portfolio of brands, a high-potential partnership with WHP and a premier omnichannel platform,” Glendinning said in the earnings announcement. “Our efforts to unlock our full potential and improve our performance are already underway.”

The apparel retailer in late November lowered its full-year 2023 guidance, now expecting net sales to be between $1.84 billion and $1.87 billion, with Bonobos driving $150 million in net sales. 

Finally, on Friday, Bloomberg reported that at least one lender to Express has approached the retailer to put aside a pool of money for expenses tied to a potential future bankruptcy filing.

A demand to set aside so-called cash reserves, if enforced, could push Express into Chapter 11 as it would eat into limited liquidity available for necessary payments to vendors, landlords and other parties.

Creditors have been growing increasingly antsy and considering whether to push the company to file for bankruptcy, Bloomberg previously reported.

Express, which is burning through a short supply of cash as it attempts to fix troubled operations, is looking to avoid any move to fund reserves for as long as possible, other people familiar with the matter said. The retailer lost over $150 million in three quarters through late October as it faced an escalating competitive threat from fast-fashion rivals.

Tyler Durden Fri, 02/23/2024 - 18:00

Read More

Continue Reading

Trending