Another retailer goes bust...

More liquidations to be expected?

Mothercare customers have lost hundreds of dollars worth of gift cards and deposits since the baby clothing retailer was put into voluntary liquidation....

...Mothercare customers have lost hundreds of dollars worth of gift cards and deposits since the baby clothing retailer was put into voluntary liquidation.

The customers, many of whom are expectant mothers, are angry with the retailer, which has refused to honour gift cards or deposits after going into administration six weeks ago... (here)

Real victims in currency wars

While the RBA and the banking industry have been showing off their resilience to the ebbs and flows of currency markets, in the space of the real economy, real businesses are going to the wall. 

Focussing on the iconic sauce maker Rosella this Bloomberg piece said:

....Rosella’s receiver today said it was unable to find a buyer and will shut the saucemaker, leaving 70 workers without a job. The failure -- along with receiverships at book seller Angus & Robertson, founded in 1884, and Allans Music, in business for 16 decades -- illustrate Australia’s lopsided economy. A mining- investment boom is delivering the quickest growth in the developed world even as it masks other weaknesses....

....“It’s disappointing that these Australian icons are either disappearing or being severely diluted and undermined,” said Kumm, who spoke before today’s announcement. His great- grandfather Frederick Cato helped found the company in 1895. “We’re used to seeing those things on our shelves and there’s a sense of belongingness.”....

Bob Gregory, a professor at Australian National University in Canberra and former central-bank board member, predicts joblessness will worsen this year. The investment phase of the mining boom, which has been construction-oriented, will wane and government-budget cutbacks will curb infrastructure projects, hurting workers without college educations, he said....Some blue-collar enclaves in Australian capital cities already have unemployment approaching recession-plagued Spain’s record 26 percent...(here)

Meanwhile for another consumer retail business, footwear there was also bad news:

...SHOE Superstore is the latest retailer to fall into administration as the chief of parent company RCG Corporation warned that some sections of the consumer market were still reeling from the impact of the global financial crisis....RCG put Shoe Superstore, which includes nine stores employing about 50 staff, into the hands of administrators yesterday, less than four years after it acquired the business... (here).

CBA too big to fail and to jail?

A Hat tip to the Australian Property Forum for its coverage of the ongoing Bankwest/CBA scandal.  In case you missed it Bankwest was a victim of the GFC and after the insolvency of its English parent, HBOS was taken over by CBA.  While previous coverage had focussed on malpractice at Bankwest (such as this Four Corners special here).  The other issue is CBA's handling of the takeover and how it may have committed fraud to extract further value from the takeover, at the cost of Bankwest customers.

The following video provides a nice diagram and explanation - here.  The coverage on the Australian Property Forum is here.

As has been pointed out in the above sources this raises several disturbing questions:

- if such behaviour has not been prosecuted, when crisis hits the Oz banking sector again (GFC2) surely it will happen again and entrap more customers at different banks?

- given CBA is now the 7th biggest bank in the world and has released glowing results (here) surely this will mean it is even less likely to be prosecuted and more likely to continue its conduct?

As the video notes - Australian bank customers need to beware - they will not necessarily be safe from Australian banks!