NEW YORK — Shoppers won’t be picking up ornate lamps from the Bombay Co. in the coming year. Or investing with Lehman Brothers and Bear Stearns. No flying to Hawaii on Aloha Airlines, either.
All those names vanished this past year, victims of the economy, the financial meltdown or other factors. Experts say 2009 could mark the end of even more well-known brands as the now-year-long recession puts more struggling companies on life support.
“I think 2009 is going to be a bloodbath,” said Scott Testa, a marketing professor at St. Joseph’s University in Philadelphia. “I think it’s going to be very, very ugly.”
For some companies, 2008 was no beauty. The woes of the nation’s retailers began before the year even started. The Bombay Co., known for its home accessories and furnishings, filed for bankruptcy in fall 2007 and shuttered the last of its stores in January because of slow sales — an ailment that hurt other companies as the economic downturn turned into a recession.
And two of the biggest names that disappeared last year took the economy and consumer confidence down with them.
Bear Stearns was headed toward collapse in March, awash in massive losses from toxic securities tied to subprime loans, before the government engineered a fire sale of the 85-year-old investment bank to JPMorgan Chase & Co. And the credit crunch that paralyzed the world economy only got worse after Lehman Brothers, a 158-year-old company, became the biggest bankruptcy in U.S. history.
The ripple effect those two failures had on the economy was evident across the nation. Consumers, already nervous about the falling value of their homes and the security of their jobs, curtailed spending even more.
With sales and profits dropping last year and lenders leery of granting new credit, a number of retailers failed. Home-goods seller Linens ‘N Things began liquidating its stores after originally filing in May for Chapter 11 bankruptcy protection.
Apparel chain Steve & Barry’s did the same later in the year. Specialty retailer Sharper Image Corp. also vanished. KB Toys is restructuring and is liquidating its more than 400 stores.
2008 economy packed punches
Amid a deepening recession, a number of big-name brands filed for bankruptcy protection or went out of business in 2008. Here’s a list of some of the biggest:
RETAILERS
Mervyns LLC filed for Chapter 11 bankruptcy protection in July and began liquidation sales at its remaining stores to wind down its business.
Linens ‘N Things filed for bankruptcy protection in May. It announced liquidation sales at its stores in October after failing to find a buyer that wanted to operate the company.
Steve & Barry’s filed for Chapter 11 bankruptcy protection in July, then later abandoned plans to keep stores open and said it would liquidate.
BANKS OR INVESTMENT FIRMS
Bear Stearns Cos. was bought by JPMorgan Chase & Co. in March in a deal orchestrated by the government.
Lehman Brothers Holdings Inc. declared bankruptcy in September, the largest ever in the United States.
AIRLINES
ATA Airlines filed for bankruptcy April 2 and abruptly ceased operations the next day.
Aloha Airlines shut down its passenger service in March after filing for bankruptcy.
