Amazon vs. Walmart (Regular Entry)

Screw it. We've been desperately trying to avoid mention of Amazon but it's simply impossible. This week Amazon ($AMZN) launched its Kohl's ($KSS) takeover...uh, partnership...pursuant to which consumers can buy Amazon products at Kohl's locations and return Amazon shipments for processing. In other words, Kohl's has become a return center for Amazon. Nothing to see here. Meanwhile, Amazon took over a few floors above the Macy's ($M) location in Seattle. Nothing symbolic about that whatsoever. Amazon has also partnered with large apartment landlords to install lockers inside large buildings. That's one way to dominate the "last mile." And people were in an uproar about that (dumbass) startup Bodega? Imagine this: "Hey Alexa, order me some toilet paper please." Within ten minutes your apartment building doorman calls you and says you have a package. How can that be? Well, just so happens the Amazon Locker in your apartment building has a stockpile of toilet paper laying in wait. Mark it: we're headed in that direction. And nobody seems to realize it. Bezos is laughing at the Bodega founders right now as he surreptitiously dominates local small business. If he has time to laugh while simultaneously wrecking fashion, that is. 

News for the Week of 01/08/17

WHAT YOU NEED TO KNOW FROM THE PAST THREE WEEKS (PLAYING CATCH-UP EDITION)

• Distressed Investing Hindsight. Avaya. Phone systems? Who would've guessed this could go wrong? Psssst: don't tell anyone but apparently Avaya and Goodman Networks are apparently in 30-day grace periods.
• Fintech. Cracks in P2P lending by way of bankruptcy (Argon Credit).
• Fraud. Theranos announced that it's letting go 41% of its work force - which we believe is a precursor to bankruptcy. Why file? To sell IP. If they actually even have any. And address litigation. Meanwhile, Snapchat, on the heals of a possible IPO, is being sued for misleading investors. Toss in ethical issues around Hampton Creek and others and we may start seeing some fraud-related bankruptcies a la 2001.
• Grocery. Is Kroger's buyout announcement another leading indicator of future distress?
• Media. Ev Williams, founder of Twitter and Medium, acknowledges that the ad-supported media model is broken while significantly cutting headcount. It seems that $150mm VC funding can't help produce a new business model. 
• Retail. It looks like the Trump Job Preservation Tour forgot to schedule stops at KMart, Sears and Macy's (meanwhile Sears unloaded Craftsman and JC Penney shed its HQ). Next up: Kohl's? Ugly 20% drop after a nasty comp store sales drop and forecast cut. Apparently, omnichannel customers are the key to the riddle. Meanwhile, Amazon is sniffing around American Apparel (as is Forever 21, reportedly) and Boohoo is focused on Nasty Gal. Gap - mostly due to a 12% comp sales increase at Old Navy - showed positive signs while Neiman Marcus cancelled its IPO, a clear negative.
• Taxi Companies. Uber is the death of traditional taxi companies and new tech companies that support the taxi companies (Karhoo). Which means those companies must really suck since Uber burned $3b in '16.
• Wearables. Pebble. "Acquired." Vinaya. Bankrupt. Does someone want to raise us a Jawbone?
• Fast Forward: With Amazon and Apple in the mix, music streaming services are struggling to make money and Soundcloud may be the closest victim. Restructuring professionals will remember that Rdio already went through bankruptcy and sold to Pandora.
• Fast Forward II: Remember Exco?
• Rewind I: Platinum Partners. It's amazing how funds get away with this nonsense: 17% returns for 13 years.
• Rewind II: Athleisure. Financials-related Uh oh (Finish Line). And bankruptcy-related uh oh (Yogasmoga). But like most things, Amazon gives zero $&%s.
• Rewind III: Coal. Maybe Trump will help the "clean coal" industry after all. And yet solar continues to progress, as does wind (in the UK and elsewhere). Ps, $361 billion is an awfully large number. And now things are progressing on the storage side thanks to Elon Musk.
• Chart of the Week: 

News for the Week of 11/13/16

• Disruption - people throw this term around a lot. But Hertz's earnings report shows disruption, i.e., the Uber-effect, in quantifiable numbers. Query to what degree hotel earnings are affected by decreased (exorbitant) parking fees lost from decreased rental car bookings. 
• Retail - Add retail outlets from the likes of Kenneth Cole, Kate Spade and Coach to the list of struggling retail businesses, Nordstrom takes a staggering $197mm write-down on start-up, Trunk Club, and J.C. Penney's total and comp store sales dropped meaningfully. On the flip side, Macy's provides strong guidance (despite an otherwise horrible earnings report) and Nordstrom, Ralph Lauren and Kohl's reported stronger than expected earnings.
• Takata - the future remains subject to debate as precedent of GM looms large (includes input from Pepper Hamilton's Henry Jaffe, Goodwin Proctor's Bill Weintraub, and Brown Rudnick's Ed Weisfelner).  
• This was pre-election results:

• Fast Forward: Bonanza Creek, Forbes Energy and Nuverra Environmental all face expirations of grace/forbearance periods this week. 
• Fast Forward II: Dynergy and Illinois Power Generating Co. (Genco) launched an exchange offer for Genco with a prepackaged bankruptcy backstop; FirstEnergy bonds plummeted after acknowledging bankruptcy as an option for subsidiary, FirstEnergy Solutions.
• Rewind I: Saudi Arabia. Feeling the pain.
• Rewind II: Oklahoma. Two weeks ago we highlighted the effects of the oil and gas downturn on the educational system in Oklahoma. We acknowledged the environmental issues there too. Well, that story keeps evolving as a 5.0 earthquake roiled through Oklahoma this past week.  And this chart is interesting:

• Chart of the Week: US field production of crude oil increased in 2015 for the 7th consecutive year to 9.42mm barrels/day, the highest crude oil production level since 1972. (Source: U.S. Energy Information Administration).