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Sears Chairman Blames Everyone But Himself


Letter to investors is show of hubris, slap in the face.

Greetings from New York, where I spent last night reading the 20-page letter to investors sent out by Eddie Lampert to shareholders of Sears Holdings (SHLD). Having recovered from my brief fling with Obamania, I can't exactly describe myself as disgusted or shocked by the note. That said, for those of you wondering what a person with a complete lack of shame does when communicating with folks he's cost billions of dollars, you've got your answer right here: Sears Holdings IR.

20 pages, folks. The first 6 pages cite the tough market for retailers in general, noting the bankruptcies of Circuit City, Mervyn's and Linens n' Things. Sears is the third largest retailer in America. Eddie's comparison points are roughly akin to me boasting that I'm in much better health than George Burns.

Mr. Lampert doesn't actually address the performance of Sears itself in earnest until page 6 of his report, during which he notes the company's solid performance in Q4. Showing remarkable restraint, he doesn't compare this performance to the bravura finish of Our American Cousin (the play during which Abe Lincoln got shot). Mr. Lampert quickly runs through a 5-point plan for turning the business around, using assorted retail truths such as a dedication to "Building our brands!"

Wrapping the turn-around plan up in 4 pages, the balance of the 20-page letter, nearly 10 full pages, is dedicated to complaining about the uptick rule, pension reform and Mark-to-Market accounting.

SHLD has gone from having a market cap of $23.79 billion in 2007 to its current value of under $5 billion. SHLD's stock has fallen over 80%. During the same period, the S&P 500 is down 37%, Target (TGT) has fallen 46% and Wal-Mart (WMT) is actually higher by 14%.
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No positions in stocks mentioned.

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