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I was wondering about that. The article mentions the spin off companies without mentioning what they were. So could this have been preventable? I've heard Toys

I was wondering about that. The article mentions the spin off companies without mentioning what they were. So could this have been preventable? I've heard Toys-R-Us wasn't that bad off; it's just that they had a leverage buyout in like the 90s or 2000s that put them in a lot of debt with the hope their growth rate would continue. The Toys-R-Us failure didn't really make any sense since people still like to physically see and touch toys before purchasing them (although I guess retailers like Target, Wal-Market, independent toy shops, et. al. have large enough toy sections now to take care of that?) There's a great 99% Invisible podcast about Sears houses. Before the cookie-cutter boom after WW2, a lot of Americans ordered kit houses from Sears which arrived in rail cars and could be assembled in a few months. Many of these houses still exist, and the people who owned them were completely unaware until amateur historians recognized them, contacted the owners and discovered the Sears seals or part numbers in their basement or attics. https://99percentinvisible.org/episode/the-house-that-came-in-the-mail/ https://99percentinvisible.org/episode/the-house-that-came-i...

candiodari 8y ago
That just means banks wanted to lend Toys-R-Us money, knowing full well (because buyout) that it was going to be paid out to the shareholders, believing it wouldn't put the company under. That was an error in judgement. What exactly is wrong here ? Banks took a chance. Banks lost. Note that one might also point out that the government's QE policy is heavily stimulating exactly this. Nothing's preventing someone else from making a new big toy emporium. Though, presumably banks will be a bit less forthcoming with huge loans.
nadezhda18 8y ago
thanks for the link, it was so interesting to read about these houses! It felt to me that ordering kit houses was such an American spirit! Building a house with your hands, there is something special about it... and ordering a kit from a store to build it is a bit mind blowing :)

candiodari 8y ago

That just means banks wanted to lend Toys-R-Us money, knowing full well (because buyout) that it was going to be paid out to the shareholders, believing it wouldn't put the company under. That was an error in judgement. What exactly is wrong here ? Banks took a chance. Banks lost. Note that one might also point out that the government's QE policy is heavily stimulating exactly this. Nothing's preventing someone else from making a new big toy emporium. Though, presumably banks will be a bit less forthcoming with huge loans.

nadezhda18 8y ago

thanks for the link, it was so interesting to read about these houses! It felt to me that ordering kit houses was such an American spirit! Building a house with your hands, there is something special about it... and ordering a kit from a store to build it is a bit mind blowing :)