Idaho's Weekly Journal of Local & National Commentary Week 2815


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by Free Market Duck

Victoria’s Secret Reorgs as Savings & Loan Bank, Qualifies for Treasury’s $700 Billion Bailout Booty
(Nov 17, 2008)

 “The failure of Victoria’s Secret, especially their Skimpy Pajama & Edible Underwear Division, would likely catapult the U.S. market into a systemic catastrophe we just can’t afford.” – Treasury Secretary Hank Paulson

Washington, DC – In a move that highlights the contortions companies are undergoing to weather the credit crisis, the sexy but battered lingerie retailer Victoria’s Secret Inc. said it has reorganized itself into a savings and loan banking institution to gain access to Secretary of the Treasury Hank Paulson’s $700 Billion Bailout Booty aimed at shoring up the banking sector.

   In order to qualify and pull off this transformation, the 20-year-old sexy lingerie shop will spend $9 million to buy Goldman Sachs of Hollywood, a previously full-figured, but now size 2, banking institution, which happens to be the alma mater of Treasury Secretary Paulson.  Victoria’s Secret is simultaneously applying to participate in the Treasury Department’s $700 Billion program to inject capital into the country’s banks.  The deadline for applications was 12 midnight last Saturday.

   Such gyrations, however kinky, come with a wink and a nod from the Treasury.  The Treasury has said sexy lingerie shops can participate in the Booty Bailout Program provided they already are, or apply to become, a federally-regulated bank or savings and loan.  In fact, a significant number of flimsy lingerie companies in the U.S. operate banks or thrifts.

   Lingerie stores, in particular Victoria’s Secret, have been pounded mercilessly by concerns that mounting losses on sales of their bras, panties, see-through teddys, and other structured lingerie vehicles (SLVs) will force them to raise capital to stiffen up their financial turgidity.  Access to the Treasury’s $700 Billion Bailout Booty would give sexy lingerie shops a relatively cheap and shareholder-friendly way of raising such funkily-fondled funds.

   Victoria’s Secret estimated it would be eligible for a $69 billion booty bailout from Treasury if its application is accepted.

   Victoria’s Secret Chief Executive, Pussycat Galore, said in a statement that the company is well endowed but that tapping booty on the Treasury’s terms “could be a prudent course in this market environment.”  The lingerie firm’s beaten-down shares -- off 95% this year -- fell 34.5% to negative 6-inches a share (about average) on Friday.

   “If Victoria’s Secret fails, 3 million suppliers to Victoria’s Secret will receive pink slips,” said Treasury Secretary Paulson.  “And no matching bras,” he added with a smirk.

   Goldman Sachs of Hollywood – prodded by Victoria’s Secret to pre-qualify the bank as a valid purchase for the Treasury’s bailout booty -- has been scrambling to shore up its push-up bras and finances since February 2008 amid losses on edible chocolate panties and strawberry thongs sold in the bank's lobby.  The Office of Thrift Supervision, which regulates savings and loans, issued a cease and desist order against Goldman Sachs of Hollywood in August, ordering it to improve its line of subprime mortgages and to raise more capital.

   Goldman Sachs – a pay day loan & thrift in Hollywood, which operates 13 branches -- was put into contact with Victoria’s Secret Inc. by “mutual professional relationships in the body massage banking industry,” Chief Executive Polly Goodrub said on Thursday.  Victoria’s Secret is paying 5-cents a share plus giving away free videos documenting Stress Point Physics for Strapless Evening Gowns to all employees at Goldman Sachs.  It also pledged to inject a stimulus package of free Bud Lite drinking glasses and see-through sheer nighties into Goldman Sachs’ to recapitalize the thrift. – Woody Blankencheck, Assistant Underwear Secretary of the U.S. Treasury

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