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Daily News – August 6, 2009

August 6, 2009

The New York Post is reporting that CIT, the troubled finance, factoring and banking giant, is being sued by a fashion company to release them from their factoring client so that they can find another firm to work with:

Scherr Inc. — a Livingston, NJ-based maker of men’s casual clothing — charges that “CIT’s disastrous financial situation creates grounds for insecurity” as the manufacturer looks to recover cash for merchandise delivered to retailers, according to a lawsuit filed this week.

Also important is that CIT has said this week that bankrupcy protection is still a clear option it needs to consider. This somehow conflicts with the pop in CIT stock value and option price for call contracts (which basically is a traders right to buy shares at a given price – called the strike price – at a given time set out in the contract). Call options were up for CIT in trading yesterday.  Dow Jones, in reporting this, discussed it in the context that AIG was up over 60% in value yesterday, and that brought up and gave confidence to a lot of other companies that few thought would survive these challenging times.

Reuters is reporting that despite sales being down, shares in Polo Ralph Lauren were up 7% yesterday:

Despite weak demand at its stores and from its retail customers, the owner of the Polo, Chaps and Club Monaco brands has cut costs, lowered inventories and gained share in some markets.

The company said gross profit margin rose 1.4 percentage points to 58.7 percent due to improvements in its wholesale and retail segments, particularly in Europe and Japan, as well as supply chain cost cuts.

Both Stylyhog.com and WWD are reporting hat Gucci is taking a step into a relatively lonely market, Canadian eCommerce, by launching an eCommerce retail site in Canada.

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