In a blow to bargain shoppers that would have been unthinkable just a few weeks ago, uber-fast growing discount apparel retailer Steve & Barry's is preparing to file for bankruptcy, according to The New York Times. The company has grown rapidly with its 50,000-100,000 square foot stores offering extremely cheap clothing aimed at college students: NBA-star endorsed basketball shoes for $8.98 (Starbury's, shown right), clothing lines endorsed by Venus Williams and Amanda Bynes, and a Sarah Jessica Parker line as well.

The company is reportedly discussing a possible deal with Sears Holdings (NYSE: SHLD), but that company isn't in such great shape either. Steve & Barry's debt load appears to be making a sale impossible without the benefit of a bankruptcy filing.

It's been a rapid fall from grace -- not so long ago, the company was the darling of mall operators looking to fill vacant big box locations. They lured Steve & Barry's with large upfront payments that kept the cash flowing for awhile. But once those were exhausted, the stores weren't profitable enough on their own.

I hold out hope for this company; it's a fantastic idea and, in some form, I think it will live on. It's my hope that at least some of the stores can be salvaged, and if not, there's always the internet. Because of its focus on retail growth, Steve and Barry's currently has no e-commerce site -- none. If someone is able to acquire this one off the bankruptcy scrapheap, I would expect that to change.

Back on June 21st, I wrote about Steve & Barry's rapid descent into a serious financial mess. The retailer that has grown to $1 billion in sales on the strength of decent quality, celebrity-endorsed clothing at ridiculously low prices ($8 basketball shoes!) reportedly needed cash badly to avoid bankruptcy.

Today The Wall Street Journal reports (subscription required) that the company is preparing a bankruptcy filing as it desperately seeks at least another $20 million in emergency financing. The company reportedly is set to close 100 stores and, if things don't improve, could go into an all-out liquidation, spelling the effective end of the company.

Now I'm being facetious here, but follow my logic: with election-year politics leading elected officials to consider bills that would provide billions in taxpayer funds to help bailout people who lied on loan applications to buy homes they couldn't afford, is providing $20 or $30 million to help Steve & Barry's stay afloat really so crazy? I mean-- and it will never happen -- but I would argue that it's a company whose survival would do a lot more to help hard-working families than helping Las Vegas speculators keep their McMansions. I'll say it again: $8 basketball shoes.

I'm really hoping that things will work out for Stever & Barry's. The death of this company would be a great loss. Perhaps Warren Buffett could serve as a white knight -- we want out $8 basketball shoes!