The Starbucks Recession Indicator

I read this article yesterday and wasn’t going to comment because I know I will be snarky. But it is interesting and then the comment thread was more interesting. I will try to control myself.

MSN Money – one of my favorite places on the Internet, has an article called, “The Starbucks Recession Indicator”. It goes like this:

“… I propose the Starbucks theory of international economics. The higher the concentration of expensive, nautically themed, faux-Italian-branded Frappuccino joints in a country's financial capital, the more likely the country is to have suffered catastrophic financial losses.”

The idea in the local sense is that Starbucks followed all of the new communities growing and sprawling across the map. So when the real estate markets crash, they rather take Starbucks with it. The other area would be the financial districts – 200+ stores in Manhattan, for example. This is the international angle. The supporting evidence is the statistical “How many Starbucks are in this area?” to “How much trouble is that area in?” London and Madrid have plenty of Starbucks, Italy has none, etc.

You can read the full text here.

Anyway, the comment thread was “What recession indicators do you see in your area?” And a lot of people said, “There aren’t any.” The wait at Olive Garden was half an hour at 8pm on a Thursday. The casino was packed - stuff like that. One person said that homes aren’t selling – and this is a big deal in my neighborhood. Another person noted that car dealers are having a very hard time of it.

My family has been with the same Chevy dealer for 25 years – same sales guy even. We just learned through the grapevine that they are closing in January. The last time I bought a car – April, 2003, Chevy didn’t have a small SUV. I had to go to Saturn, and felt guilty about it until the next year when my mother bought her Malibu. I am feeling just a bit guilty again. As if my purchase 5 ½ years ago would somehow have made a difference.

No, I am not thinking of running over and buying a car. But I am considering the concept of balance:

Where is the line between personal fiscal responsibility and one’s duty as an employed person to support the economy?