Diamonds Losing Their Luster
By Rudy Armstrong
Fortunoff, a popular jewelry store centered in New York and New Jersey, filed for Chapter 11 bankruptcy Thursday. Even though they were trying to sell the company, brought on by a poor retail season, they suffered "a severe liquidity crisis" and were unable to secure a buyer.
Bankruptcy is not uncommon is the current economic recession. In addition to Fortunoff, retailers such as Circuit City and Gottschalk had to close their doors due to a fatal decrease in consumer spending.
Despite negotiations with potential buyers and meetings with financial advisers, Fortunoff decided that filing for bankruptcy, in order to go through the courts, was the best recourse. In the filing, Fortunoff claimed $100 to $500 million in liabilities and assets.
This unfortunate demise has become a typical outcome for many retailers. As noted by Jerry Mozian, a national segment leader at Tatum, the new year has ushered in several bankruptcies, "January is one of the typical months that retailers file, and then you put on top of that the backdrop of a very terrible economy."
Full link http://money.cnn.com/2009/02/05/news/companies/fortunoff_bankruptcy.reut/index.htm
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