Starbucks Chief Doesn’t See U.S. Economy Improving (Update2)
By Josh Fineman and Tim CattsMarch 19 (Bloomberg) – “Starbucks Corp. Chief Executive Officer Howard Schultz said the U.S. economy is in a “tailspin” and the coffee-shop chain will offer discounts and new drinks to lure back customers.
Starbucks, the world’s largest chain of coffee shops, also said today it would acquire Coffee Equipment Co., the maker of the $11,000 Clover machines that brew one cup of coffee at a time. Financial terms weren’t disclosed.
“You have an economy that really is in a tailspin, and many would say the consumer is in a recession,” Schultz told more than 6,000 shareholders at the company’s annual meeting in Seattle. “We are dealing with things that we haven’t seen before in terms of how people are responding to how tough it is”.”
CHICAGO (Reuters) – “The pizza industry is under more pressure than it was at the beginning of the year, the chief executive of Papa John’s International Inc (PZZA.O: Quote, Profile, Research) said on Tuesday, as commodity costs rise and consumers worry about the economy and the cost of gasoline.
“I personally think we are in a recession,” CEO Nigel Travis said during the Reuters Food Summit in Chicago. Consumers are increasingly concerned about the economy, he added.In February, the world’s third-largest pizza company reported lower fourth-quarter profit as rising commodity prices fueled losses at its franchisee-owned cheese purchasing operation. Revenue and same-store sales increased about 2 percent for the period”.
Well we must be in a recession because people are eating less pizza and drinking less expensive coffee.
As we descend back to earth where most of us live, I think we can see a clear pattern emerging. If there have been mistakes in business judgment and decisions that have caused negative financial results then just blame it on the economy. You and I can not do that!
I think it would be a good idea to pay down unsecured debt like credit cards and stick with things that have increasing value. Work on your balance sheet and increase your real net worth. Avoid get rich quick schemes like the plague. Proverbs 22:7 “The rich rules over the poor, And the borrower becomes the lender’s slave.” It is time to return to good business practices and the principles of good financial management.
Until next time, Jim
