You can’t say "containment" with a straight face after this- look what is happening with Starbucks:
SEATTLE- Starbucks Corp. fired Chief Executive Jim Donald on Monday, handing the reins back to Chairman Howard Schultz as part of a major restructuring initiative aimed at pulling the company out of a downward slide.
The move, coupled with plans to close some U.S. stores and slow down opening new ones, comes as the world’s largest chain of coffee houses has seen its stock plummet 50 percent over the last year and declining traffic in its domestic stores.
What has happened to this former Wall Street darling?
Starbucks has struggled in recent months as consumers have cut back on spending amid declining home values and higher fuel prices.
I guess cash-strapped consumers are going to need to find another way to wake up.
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Especially since every personal finance writer mentions cutting back on the $4 coffees whenever they write a generic article on how to save money.
Maxtower-
You’d think $4 wouldn’t be that much in the grand scheme of things, but my daughter is an SB employee [at least for now] and she says they’ve got one customer, a construction worker, who stops in for coffee four times a day.
I think for most people, that kind of spending has got to stop.
It’s the middle class crack. I admit I became a slave to SB. One mocha every day (sometimes two)and I realized I was droppin over $1500/yr. It now costs more to drink starbucks than to smoke. One of my resolutions is to drop it (i’ve had 2 so far this year). I’m sure we’re going to see a very large trend in cutting back on things we can’t afford (without our HELOCs). Gotta go…I’m gettin the shakes!!
As an admitted non-coffee drinker, I can’t say that I’ve been a frequent flyer at Starbucks. Nor can I say that there’s something else that I feel the need to spend $4 a serving on.
Twist and fellow Doomers, I have seen the surest sign (at least in my own mind) yet that recession is upon us.
I am on my way to the annual Consumer Electronics Show (CES) in Las Vegas this afternoon. I was able to get a room on the strip, at the Sahara, walking distance from the convention center, for averaging a wee bit over $100 a night for the week. And I made the reservation on Sunday.
This might not seem that surprising to those who are not regular attendees of the show, but during CES, Vegas hotels (esp. strip hotels) are usually both (i) very full and (ii) very expensive. Right now, almost every strip and convention hotel is showing availability, and most for rates lower than I’ve seen in years during CES.
Recession is upon us, and sooner, not later.
P.S.–> Yes, I know I said I was never going back to Vegas. {Sigh}