The large bin of holiday pillows empties out almost as quickly as the staff can replenish it. Across the floor the supply of a dozen treadmills is getting dangerously low. And forget about buying an electric wreath or 3-D star for Christmas. Gone.

Even the most loyal Sears workers at the new store in suburban Glen Burnie, Maryland, can hardly believe it as they watch merchandise disappearing from their stores faster than they can spell R-E-B-O-U-N-D. Three years ago, the company was closing stores and slashing its work force. On a single day last month, 10 new Sears stores opened, including...

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