Bed Bath & Beyond defaults on payments
Bed Bath & Beyond disclosed in a regulatory filing on Thursday that it had defaulted on certain debt payments, weeks after the beleaguered retailer warned investors it was contemplating filing for bankruptcy protection.
It is the most salient sign of strain yet for the retailer, which said earlier this month that it was exploring a possible bankruptcy filing after a disappointing holiday season. Bed Bath & Beyond has been looking for cash to help it avoid filing for bankruptcy, but time may be running out. The retailer on Thursday also warned in the filing that it did “not have sufficient resources” to pay its debt.
A bankruptcy filing could come within weeks, two people familiar with the matter said, speaking on condition of anonymity because the discussions are confidential. The people cautioned that no plans are certain. The retailer has been talking with Sycamore Partners to sell assets, including its Buy Buy Baby stores, as part of a possible bankruptcy.
The retailer employed about 32,000 workers as of February 2022 and has roughly 900 stores across the country. Since warning of its financial issues, Bed Bath & Beyond has continued to lay off workers and close stores to try to shore up its balance sheet.
In January, it reported a $393 million loss for the third quarter, 42% more than its losses from the same quarter a year earlier. Its net sales dropped to about $1.3 billion, 33% less than the year before.
Economic expansion cools, as Federal Reserve wanted
The U.S. economy beat expectations in the last quarter of 2022, posting the kind of mild slowdown that the Federal Reserve wants to see as it attempts to tame inflation without choking off growth.
Economists who dug into the details, though, saw enough warning signs — especially in weakening demand among American consumers — to suggest that a recession remains a big risk this year.
Gross domestic product rose at a 2.9% annualized pace, down from 3.2% in the third quarter. A separate report on labor markets published Thursday also pointed to a resilient economy, rather than one on the verge of a slump, with weekly jobless claims unexpectedly falling.
For the Fed, which has hiked interest rates at the steepest pace in a generation over the past year, the data suggest that there's still a path to what's known as a “soft landing.” That's a scenario in which tighter monetary policy cools household spending and lowers inflation — but avoids squeezing the economy so hard that it ignites mass layoffs nationwide.
Fast-food workers' rights bill on hold until 2024 ballot
A bill that would boost wages and promises to improve working conditions for California's fast-food workers has been put on hold until the November 2024 election when voters will decide its outcome.
Assembly Bill 257, also known as the FAST Recovery Act, was signed into law Sept. 5 by Gov. Gavin Newsom. But Save Local Restaurants — a coalition of fast-food franchisees and franchisers who oppose the measure — gathered enough signatures to place a referendum on the 2024 ballot.
The bill was designed to help workers who often struggle to make ends meet. It would also address wage theft, harassment, discrimination and unsafe work conditions fast-food workers say they face on the job.
The coalition, which needed 623,000 voter signatures by Dec. 4 to put the bill on hold, submitted more than 1 million. At least 712,000 were deemed valid Tuesday by the Secretary of State's office.
“The FAST Act was a solution in search of a problem that didn't exist,” International Franchise Association President Matt Haller said Wednesday in a statement. “Fortunately, now more than one million Californians have spoken out to prevent this misguided policy from driving food prices higher and destroying local businesses and the jobs they create.”