According to an article in the Star-Telegram , Circuit City, which filed for Chapter 11 bankruptcy in 2008, has announced that it will be going out of business, closing all of its 567 stores in the U.S. and slapping the economy with over 34,000 job losses. The announcement came after two potential buyers for Circuit City fell through a bankruptcy trustee approved the complete liquidation of Circuit City’s remaining assets.
This is a huge blow to the economy. Thirty-four thousand job losses? That’s huge coming from one company and it’s set to have huge side-effects for all of us. These job losses represent individuals who might be unable to find new employment. This could mean more foreclosures as many of those 34,000 people struggle to pay mortgages and other debt.
There’s an interesting quote in the article:
It was unclear what would happen to the company’s 765 retail stores and dealer outlets in Canada. Galardi told a judge there are still bids for the Canadian business.
Interesting, there are still bids for the Canadian business unit; but no bids for the U.S. business unit. Maybe these business deal makers know something we don’t. Maybe they see that the U.S. has a long way to go before it hits rock bottom and begins a turn for the better. Something to think about.
Also, keep an eye out for the state of commercial real estate; we could see many bankruptcies in that sector as Circuit City unloads 567 big box stores.