bsnsBlooper: The Man With an Eighth Grade Education Who Bought Bloomingdale's

Some collapses take everyone by surprise. This one had a paper trail years in the making.

On January 15, 1990, Federated Department Stores and Allied Stores, the parent companies of Bloomingdale's, Rich's, Jordan Marsh, and Abraham & Straus among others, filed for Chapter 11 bankruptcy, the largest retailing bankruptcy in U.S. history at the time. The companies had been acquired in 1986 and 1988 by Canadian developer Robert Campeau, financed almost entirely through debt arranged by his own investment bank, First Boston, which collected nearly $79 million in fees regardless of whether Federated could actually service the loans. The collapse landed amid the broader unraveling of the junk bond market that also took down Drexel Burnham Lambert weeks later.

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