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Trump Says He May Act to Stop Evictions Amid Virus-Aid Talks

President Donald Trump said yesterday that he may take executive action to impose a moratorium on evictions and to enact a payroll tax holiday, with talks on a new virus-relief plan making slow progress in Congress, Bloomberg News reported. The White House is also exploring whether the president can act on his own to extend enhanced unemployment insurance payments that, like an eviction moratorium, were part of stimulus legislation enacted in March but now have expired. Later, Trump told reporters that he’s discussing suspending payroll taxes through an executive action. Trump spoke while Treasury Secretary Steven Mnuchin and Trump’s chief of staff, Mark Meadows, met at the Capitol with House Speaker Nancy Pelosi and Senate Democratic leader Chuck Schumer. Both sides said after the two-hour meeting that they made some progress, and would convene again on today. “It was productive, we are moving down the track,” Pelosi said, adding that “we still have our differences.” The two sides are trying to close the gap between the $3.5 trillion Democratic plan passed by the House in May and the $1 trillion package of aid that Senate Republicans introduced last week.

Top GOP Lawmaker Urges Regulators to Extend Relief for Renters, Banks

The chairman of the Senate Banking Committee is calling on federal agencies to extend economic relief measures that Congress established in March, as lawmakers and the Trump administration struggle to reach a deal on the next round of aid, Politico reported. In a letter to housing and bank regulators, Senate Banking Chair Mike Crapo (R-Idaho) urged the officials to use their existing authority to continue eviction protections and looser lending rules — in effect doing an end run around Congress. "Although there are already early, encouraging signs that the U.S. economy is beginning to heal, federal financial regulators must remain diligent, and continue to provide relief in light of a pandemic and economic conditions that continue to evolve," he said in the letter sent Friday. Crapo sent the letter to leaders of the Federal Reserve, Office of the Comptroller of the Currency, Federal Deposit Insurance Corp., National Credit Union Administration, Department of Housing and Urban Development and the Federal Housing Finance Agency. The nature of the request suggests that Crapo believes that lawmakers might not be able to address the measures in the near future. The letter gives the agencies additional cover to take matters into their own hands. Eviction protections that Congress passed in March expired on July 24.

Analysis: Bankruptcies Rip Through U.S. Mall Tenants With No End in Sight

Every week seems to bring another round of retail bankruptcies. With conditions worsening, the numbers are likely to keep climbing, Bloomberg News reported. Over the weekend, Tailored Brands Inc. — the owner of Men’s Wearhouse and JoS. A. Bank — and department store Lord & Taylor filed for chapter 11. The Canadian unit of Chico’s FAS Inc. declared bankruptcy on July 31. The previous week, it was Ann Taylor and Lane Bryant parent Ascena Retail Group Inc. At least 25 major retailers have now filed for bankruptcy this year, with 10 of these coming over the last five weeks. The steady drumbeat of bankruptcies goes back to mid-March, when the lockdown of non-essential retailers began in an attempt to halt the spread of COVID-19. The U.S. economy has now largely reopened, but this hasn’t provided relief to the battered industry, which has taken on more leverage in the battle to survive. “The common denominator is debt,” said Simeon Siegel, an analyst at BMO Capital Markets. “At this point, now everyone has debt. Everyone took on massive amounts of liquidity.” With the U.S. seeing a resurgence of COVID-19, retailers are now flying blind into the year’s most vital shopping months. Companies have to juggle decisions on cost cutting, store closures and merchandise without having a clear picture of where consumer demand will be or how bad economic conditions will get. Apparel sales were down about 30 percent in June, even as overall U.S. retail sales have picked up this summer, according to Panjiva, the supply chain research unit of S&P Global Market Intelligence. As many as 25,000 stores are expected to close in the U.S. in 2020, mostly in shopping malls, according to Coresight Research. Department stores and fashion boutiques are seen as the most endangered.

J.C. Penney's Survival Hinges on Urgent Sale Negotiations

The survival of J.C. Penney Co Inc hangs on whether the department store chain can reach a complex deal within days to sell itself to an alliance of retail mavens and distressed-debt investors, Reuters reported. The 118-year-old retailer blew through a Friday deadline from lenders to sort through bids that would take the company out of bankruptcy proceedings that were commenced in May after the pandemic forced it to temporarily close all its 846 stores. The Plano, Texas-based company, already facing concerns from U.S. Bankruptcy Judge David Jones that its restructuring is not moving fast enough, is racing to reach agreement on a sale that would carve the retailer into three pieces. The company is hoping to file court papers as soon as this week disclosing details of a deal, though the timing could slip. J.C. Penney has lost money for years, grappling with consumers shifting to online shopping and competition from discount retailers. It is among a cascade of retailers undone by the pandemic, including Brooks Brothers and Lucky Brand Dungarees, now attempting to withstand unprecedented economic turmoil and stay in business through bankruptcy sales. Some J.C. Penney vendors are demanding cash-on-delivery before shipping merchandise, the person familiar with the matter said, an onerous term for a retailer with strained finances accustomed to paying for goods later.

Men’s Wearhouse, Jos. A. Bank Parent to Pivot to Casual Attire in Chapter 11

The parent company of the Men’s Wearhouse and Jos. A. Bank menswear brands entered bankruptcy hoping to turn around the nearly half-century-old business in the midst of the COVID-19 pandemic by slashing at least $630 million in debt while pivoting to casual wear from business clothing, WSJ Pro Bankruptcy reported. Retailer Tailored Brands Inc., which also owns retail brands K&G Fashion Superstore and Moores Clothing for Men, filed for chapter 11 bankruptcy protection on Sunday after revenue declined by about 5.6 percent over the past two fiscal years ending in February, despite a dominant position in the menswear market. The company couldn’t avoid bankruptcy once the coronavirus pandemic forced its stores to shut temporarily and slashed demand for dress clothes as millions of Americans started working from home. COVID-19 restrictions also have caused supply-chain disruptions, reduced store traffic, and cancellations of large gatherings such as proms and weddings. The company had reported a net sales decline of more than 60 percent for the quarter ended May 2 compared with the same period a year earlier. Tailored Brands is forecasting total revenue of $1.4 billion for the 2020 fiscal year and $2.4 billion for 2021, compared with $2.9 billion it generated in 2019. Tailored Brands blamed its pre-pandemic struggles on missteps including a limited range of style offerings and pricing that missed out on revenue opportunities, as well as underinvestment in casual selections and e-commerce as customers gravitated toward online purchases. On top of that, price increases over multiple years led to higher prices compared with the competition, resulting in lower customer counts, store traffic and unit sales. Now, the Fremont, Calif., company said it wants to speed up plans to mix its products as sales of tailored clothing decrease. It intends to focus more on its selection of polished casual clothing, including sport coats, pants, dress shirts and sportswear.