Newspapers are performing even worse than expected according to Fitch Ratings. Wasn't the outlook already grim? Well, it's even worse than it was in January. Needless to say, Fitch has a negative outlook on the newspaper industry. They think declines are likely permanent, not cyclical. Who will hurt the most? Well markets in California and Florida, where the housing bubble was really huge, will see particularly outsized declines. Pop! ouch.
Is there any upside? Fitch thinks the credit crisis will likely halt some of the highly leveraged takeover deals, (think of Sam Zell and the Tribune) that are risky for bond holders, which it believes is a good thing. Though I'm not sure if that's good enough for investors.
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