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July 26, 2004

The Starbucks Economic Indicator

Dave Sheridan says rising same-store sales at Starbucks indicate a strengthening economy. This and much more econo-bloggage can be found at this week's edition of the Carnival of the Capitalists.

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Comments

I have heard that Tiffany's is also doing well.

Posted by: SemiPundit at July 26, 2004 05:54 PM

Semi, you clearly either didn't read Sheridan's piece, or you missed the point. Or you're being obtuse. There is a vast difference between Starbucks and Tiffany's. As Sheridan explained, "Starbucks is a good proxy for affordable luxuries—things that don’t break the bank, are non-essential and have lower-priced alternatives. ... For most consumers, nothing Starbucks sells in its stores is essential. If their customers are more budget-conscious this year than they were last year, latte purchases will suffer. If customers feel better about their near-term financial picture, an extra one now and then doesn’t seem so frivolous. The major consumer confidence indices are based on surveys. There’s nothing particularly wrong with surveys per se, but the [Starbucks]indicator adds information on how consumers are voting with their own money."

Posted by: Bill Hobbs at July 26, 2004 06:59 PM

I vote for obtuse.

Posted by: Ivan at July 26, 2004 11:59 PM
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