Wednesday, October 8, 2008

Is your Grocery Store highly leveraged?

I don’t want to be a fear monger, but I don’t want to stick my head in the sand either. How leveraged is your grocery store? Check them out on Yahoo finance if you don’t know. The mom & pop stores are gone. Today’s grocer is a large conglomerate who has used cheap money to expand. If the commercial paper market doesn’t open up soon, how long will it be before they do not have a credit facility to keep their shelves stocked? Think Hurricane Ike, or Rita, or Katrina. Take your pick. Scary stuff. I agree with the decision to use the bailout money to support commercial paper. I disagree with how they lied to get the money.

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