Hartmarx Inc.

, which owns

President Obama's

hometown Chicago clothier,

Hart Schaffner Marx

, and a dozen other men's brands, and distributes



Pierre Cardin

sweaters and

Doc Martens

boots, filed for bankruptcy protection last weekend.

Hartmarx is weighed down by the same kind of too-big-to-change baggage that prompted

General Motors Corp.

to beg a bailout from Washington.

Hartmarx, like GM, "didn't integrate the expenses of its brands" and let them get "a little stale" as the market slowed, said

Les Schwarzberg

, the Philadelphia owner of

Les Richards Menswear

, which has stores in the

Shoppes at Liberty Place

and in Upstate New York.

In Bankruptcy Court, it is typically suppliers, not taxpayers, who get squeezed.

But there's some good news when the big guys hurt

that way, adds Schwarzberg, a veteran of Philadelphia's former

Today's Man



store chains. Inventories are going to be sold by bankruptcy specialists "at a lower price," and the merchandise will find its way onto the market at markdowns, making life a little less tough for independent stores, regional chains and consumers, Schwarzberg said.

Life in the slow lane

Stephen A. Schwarzman

, the Philadelphia native who made $700 million when he took buyout firm

Blackstone Group L.P.

public at the start of 2007, is suffering a "hangover" from the blowup of the inflated market he helped create, Bloomberg News says.

Industry giants Blackstone,

KKR & Co.


Carlyle Group

, as well as dozens of smaller firms, are having a tough time getting banks to lend them money or finding buyers for the companies they took over for inflated prices at bargain interest rates.

Since they cannot collect their customary 20 percent cut on assets that won't sell, the buyout guys are looking for work as advisers to companies with assets of their own to unload in a tough market. Blackstone's new clients now include taxpayer-backed

American International Group Inc.

Paying for Madoff

Banco Santander S.A.

, the Spanish bank that's due to absorb Pennsylvania-based

Sovereign Bancorp Inc.

tomorrow, says it will offer preferred stock worth nearly $2 billion to clients ripped off when Santander's


private-banking group steered them to former


stock market chairman

Bernard L. Madoff's

phony hedge funds.

Santander will be able to write off the payoffs, shave part of the cost from its taxes, and reduce the threat it will be sued by angry Optimal clients, reports

CreditSights Inc.

Wachovia woes

Wachovia Corp.

would have posted a loss of $11.3 billion in the fourth quarter if

Wells Fargo & Co.

hadn't bought it, Wells

chief financial officer Howard Atkins

told investors yesterday.

That's from "market-disruption losses" of $4.3 billion, $4.2 billion set aside to cover bad loans, and a $2.8 billion tax write-down (which happens when you're not making money and can't write off losses).

Separately, Wells Fargo's

Wealth Management Group

, which serves "high-net-worth" people, took "a charge-off of $294 million pretax related to clients who were impacted by the Madoff fraud," Atkins said.

Despite the losses, Wells Fargo says it still will pay its dividend. The stock rose nearly 31 percent, popping above $20 for the first time since Jan. 15.

Partners in science

Garnet Biotherapeutics

, of Malvern, headed by

Gerri Henwood

, former chief executive officer of

Auxilium Pharmaceuticals Inc.

, will announce today that it has raised $10.4 million to boost development of its "regenerative therapy," developed from adult bone marrow and used in scar reduction, says

Safeguard Scientifics Inc. managing director Gary Kurtzman.

Safeguard is joining

SCP Vitalife Partners,

of Wayne, and Atlanta's

Alliance Technology Ventures

in backing the deal.

It's part of Safeguard's recent move into life sciences, including recent investments in cell-regeneration developer

Tengion Inc.

, of East Norriton, and

Advanced BioHealing Inc.

, of Westport, Conn.

Safeguard has worked investment trends with mixed success since the 1950s. The firm has 18 active investments in biotech and info-tech companies, Kurtzman said.

Contact staff writer Joseph N. DiStefano at 215-854-5194 or jdistefano@Phillynews.com.