Five Dumbest Things on Wall Street: May 8

Lampert's Laboratory

Eddie Lampert was once considered the next Warren Buffett because of his financial acumen. Too bad the wizard behind Sears Holdings(SHLD) chose to practice retail alchemy instead.

The billionaire investor and majority stakeholder in Sears told investors at the company's annual meeting Monday that the struggling retailer will spend the remainder of 2009 tinkering with operations at both its brick-and-mortar outlets and its Web sites in order to improve the customer experience. Lampert told the Chicago audience he is busy devising ways to make the nearly 200 million square feet of retail real estate space controlled by the company "more productive."

Lampert seemed most proud of his latest plot, a concept called MyGofer whereby shoppers can order online and pick up their purchases at a drive-through warehouse. If nobody shops at the stores, what makes him think they'll want to drive through the warehouses?

Sears just opened its first MyGofer location in Joliet, Ill., in an old Kmart store. Lampert said he sees MyGofer as a way to convert hundreds of high-cost stores into low-cost, high revenue-generating warehouses.

"I want to get this right," said Lampert about the service whereby shoppers can buy everything from milk to appliances without leaving their cars.

We bet you do Eddie, especially after your never-ending string of failed efforts to reinvent retailing.

Who can forget that Sears Essentials experiment when you tried to take on Wal-Mart(WMT) and Target(TGT) by turning Kmarts into second-rate Sears stores? Or how about your decision to buy back 33 million shares at an average price of $132 between 2004 and 2007 instead of making capital improvements at your stores? All that dough sure could have made a lot of Sears stores "more productive," now couldn't it?

Now we know it's an ugly environment for large and small shopkeeps out there, so we won't blame all of Sears recent woes on your less-than-subtle strategy of trial and a whole lot of errors. And we can plainly see that your company's stock has risen substantially this year, up 55%, as analysts and investors applaud your ruthless cost cutting and store closings.

But please understand our skepticism when your MyGofer scheme to save one of America's oldest and best known brands sounds to us like a bad cross between Amazon.com(AMZN) and Dairy Barn.

Dumb-o-meter score: 90 -- MyGofer? My Goodness!