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Bed Bath and Beyond files for bankruptcy

nytimes.com

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Re: Bed Bath and Beyond files for bankruptcy

#121

Post by NoboruWataya »

patrickthebold wrote: post #32
humanlion87 wrote: post #8

I find the whole situation fascinating. Bed Bath continued to sell hundreds of millions of shares while they were preparing for bankruptcy and retail investors (or meme stock investors) continued to buy them. I assume Bed Bath did all the paperwork that is necessary (like calling out risks, that the raised capital will go to creditors first, etc) for such a stock sale. But it is clear they were doing it out of bad-fa…

Random thought and I figure there must be a law against this: But what about the opposite, could a company sell off it's assets and do stock buy backs right until it goes bankrupt so that some investors get more $ ahead of the creditors?

In general, doing anything in anticipation of bankruptcy that would have the effect of preferring shareholders over creditors is illegal. The way that particular rule is described varies from jurisdiction to jurisdiction and there have been many attempts to get around it, but that is the general principle.

Re: Bed Bath and Beyond files for bankruptcy

#122

Post by fumar »

spaceman_2020 wrote: post #118
neurobama wrote: post #52

Earlier quoted context omitted.

The whole stock market in 2023 makes no sense to me, not just Bed Bath and Beyond. So many companies no longer pay dividends. So many classes of stock are now non-voting shares. Common stock shareholders usually get nothing if a company goes bankrupt and liquidates. So if I don't get dividends, can't vote, and am not entitled to a share of the company's assets, what is the actual value in owning stock? Do I just wait…

Everything has been fundamentally detached from reality, from stocks to housing. Houses can sit empty without tenants for years but they’ll only go up. Companies can be unprofitable for literal decades but they’ll keep finding funding and buyers. Commercial properties can bleed tenant but the prices will only be up. In a world of shrinking growth , stalling productivity, and dying demographics, the market behaves lik…

Does this mark an end for our society's principles? Are we do for a dark age? Are we in it or will there be an enlightenment or renaissance?

Re: Bed Bath and Beyond files for bankruptcy

#124

Post by Tyrek »

bombcar wrote: post #42
bookofjoe wrote: post #13

Earlier quoted context omitted.

>I assume Bed Bath did all the paperwork that is necessary (like calling out risks, that the raised capital will go to creditors first, etc) for such a stock sale. I'm not clear on why your next sentence is: >But it is clear they were doing it out of bad-faith to the new investors. Where is the "bad-faith" in caveat emptor?

You know those Prop 65 warnings you see on everything? It's the difference between a company sticking it on everything "just in case" and a company with the CancerTron-9000™ rebranding as "edible low-fat sweets" with that label on it. Every single filing with the SEC contains language that is basically 'holy shit we could go bankrupt tomorrow because billions of reasons' - that's different from "we know we're going d…

BBBY has issued multiple warnings of bankruptcy, far beyond the disclosures 'standard SEC language' that other (healthier) companies file on a regular basis.

Re: Bed Bath and Beyond files for bankruptcy

#125

Post by [deleted] »

dragontamer wrote: post #112
BaseballPhysics wrote: post #107

Earlier quoted context omitted.

It's ironic that you make that comparison, as a lot of very very financially literate people buy lottery tickets because they know they're taking a risk , they know the probabilities , and they still do it because it's fun . For the same reason, some of the most brilliant minds out there gamble on games of chance, or engage in sports betting, or other high risk activities. Just because someone takes a risk that you w…

No. It makes you a gambler. And gamblers don't usually make money, because they're in it for entertainment rather than making money, saving money, or providing for their families. Believe it or not, investing is an activity that, under the correct circumstances, leads to the benefit of the investor, the company, and the economy in general. I personally seek this behavior that's beneficial to society in general (and i…

[deleted]

Re: Bed Bath and Beyond files for bankruptcy

#126

Post by gamblor956 »

Animats wrote: post #73
pseg134 wrote: post #58

Earlier quoted context omitted.

The only place to get a new mattress these days and not get ripped off is Costco

They're still 5x more expensive than Alibaba. Which is where most mail order mattresses come from. Making a mattress costs under $100.

Alibaba is super cheap because you're buying the literal bargain basement version of the product, and what you're getting almost always violates local product safety laws that domestic manufacturers and/or sellers must contend with.

Yes, the mattress at Costco is 5x the price. But it's probably 20x the value.

Re: Bed Bath and Beyond files for bankruptcy

#127

Post by spokesbeing »

aketchum wrote: post #120
HDThoreaun wrote: post #77

Earlier quoted context omitted.

Dividends pay the exact same tax rate as selling stock which is how you make money from buybacks. The difference is that buybacks allow you to take the income in the future and shift the tax burden timing. Both dividends and stock selling are normal income tax rate if you've held the stock for less than 6 months and capital gains rate if you've held for more.

Are you sure about this? I believe you would prefer a share value increase of $1 instead of a dividend of $1, as you are taxed on dividends as income (income tax) but stock appreciation is capital gains (lower tax than income tax). This is in the context of American taxes.

"Qualified dividends" are taxed the same as capital gains. To be qualified mostly depends on a minimum holding time, 60 days for common stock.

https://en.m.wikipedia.org/wiki/Qualified_dividend

Re: Bed Bath and Beyond files for bankruptcy

#128

Post by rcme »

spaceman_2020 wrote: post #118
neurobama wrote: post #52

Earlier quoted context omitted.

The whole stock market in 2023 makes no sense to me, not just Bed Bath and Beyond. So many companies no longer pay dividends. So many classes of stock are now non-voting shares. Common stock shareholders usually get nothing if a company goes bankrupt and liquidates. So if I don't get dividends, can't vote, and am not entitled to a share of the company's assets, what is the actual value in owning stock? Do I just wait…

Everything has been fundamentally detached from reality, from stocks to housing. Houses can sit empty without tenants for years but they’ll only go up. Companies can be unprofitable for literal decades but they’ll keep finding funding and buyers. Commercial properties can bleed tenant but the prices will only be up. In a world of shrinking growth , stalling productivity, and dying demographics, the market behaves lik…

Is the market acting like infinite growth is baked in, or is inflation simply out of control? And I’m not talking about CPI over the last three years. Stocks have been insane over the last decade. Real estate has been insane over the last decade. Neither of which is measured by CPI. So yea… the market is pricing things like the Fed will keep printing money to prop up assets it explicitly ignores in its inflation calculation.

Re: Bed Bath and Beyond files for bankruptcy

#129

Post by BaseballPhysics »

dragontamer wrote: post #112
BaseballPhysics wrote: post #107

Earlier quoted context omitted.

It's ironic that you make that comparison, as a lot of very very financially literate people buy lottery tickets because they know they're taking a risk , they know the probabilities , and they still do it because it's fun . For the same reason, some of the most brilliant minds out there gamble on games of chance, or engage in sports betting, or other high risk activities. Just because someone takes a risk that you w…

No. It makes you a gambler. And gamblers don't usually make money, because they're in it for entertainment rather than making money, saving money, or providing for their families. Believe it or not, investing is an activity that, under the correct circumstances, leads to the benefit of the investor, the company, and the economy in general. I personally seek this behavior that's beneficial to society in general (and i…

> Believe it or not, investing is an activity that, under the correct circumstances, leads to the benefit of the investor, the company, and the economy in general. I personally seek this behavior that's beneficial to society in general

That sounds very noble.

Of course, the reality is the vast majority of people trading financial instruments do it for one reason: to enrich themselves (or, in this case, to entertain themselves). Everything else is a side effect as a consequence of regulations creating incentives that lead to socially constructive outcomes.

> so you're betting that other people have undervalued a company

That's... kinda the entire point of active trading.

I personally don't believe it. In general I'm an efficient markets guy. But there are a lot of active investors, including mutual funds, hedge funds, etc, that operate exactly on this principle.

Re: Bed Bath and Beyond files for bankruptcy

#130

Post by spaceman_2020 »

fumar wrote: post #122
spaceman_2020 wrote: post #118

Earlier quoted context omitted.

Everything has been fundamentally detached from reality, from stocks to housing. Houses can sit empty without tenants for years but they’ll only go up. Companies can be unprofitable for literal decades but they’ll keep finding funding and buyers. Commercial properties can bleed tenant but the prices will only be up. In a world of shrinking growth , stalling productivity, and dying demographics, the market behaves lik…

Does this mark an end for our society's principles? Are we do for a dark age? Are we in it or will there be an enlightenment or renaissance?

I don’t know, but it’s increasingly frustrating as an average person. Apartments around me keep appreciating in value every year, rents keep going up astronomically even when the houses stay empty.

My income went up, but housing in my area went up nearly 2x. I’m being priced out of areas I’ve lived in forever.

I feel like a social contract has been violated. Everything, from products to housing seems to be targeted at the “luxury” and “premium” segment. It’s like a omnipresent giant middle finger to anyone but the wealthy.

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