Please be positive and upbeat in your interactions, and avoid making negative or pessimistic comments. Instead, focus on the potential opportunities.
- Manlobbi
Halls of Shrewd'm / US Policy
No. of Recommendations: 2
McDonald’s and Starbucks' U.S. sales are down, but Advance Real Retail and Food Services Sales is up YoY. Next data update May 15th.
=== links ===
McDonald’s store traffic falls unexpectedly as diners grow uneasy about economy, May 1, 2025
"The trouble was particularly acute in the U.S., where same-store sales — or sales at locations open at least a year — slumped 3.6%. That was the biggest U.S. decline McDonald’s has seen since 2020, when a pandemic shuttered stores and restaurants and other public spaces nationwide. McDonald’s Chairman and CEO Chris Kempczinski said lower- and middle-income consumers, worried about inflation and the economic outlook, cut back on fast food during the January-March period."
https://apnews.com/article/mcdonalds-first-quarter...Starbucks says turnaround is on track, but quarterly earnings and sales fall short, April 29, 2025
"While international same-store sales increased 2% — and store traffic improved in China — U.S. same-store sales fell 2%."
https://apnews.com/article/starbucks-earnings-quar...Advance Real Retail and Food Services Sales (RRSFS)
https://fred.stlouisfed.org/graph/?g=VURp
No. of Recommendations: 0
I don't go to Starbucks ($$$$$). Have not been to one in 20+yrs.
McD I might go--2-4 times per year.
No. of Recommendations: 7
We almost never go to fast-food joints. When we do eat out, it's generally in very ethnic places (Turkish or Middle Eastern bakeries, Chinese places in Chinese neighborhoods, Mexican places in Mexican neighborhoods and so on (and even more frequently, in some "emerging market" country).
This morning, my wife had a doctor's appointment so, in case of a blood test, we didn't eat breakfast before leaving. We ate at a diner near the doctor's office (nothing special, a couple of omelets and two cups of coffee) which, after tax and tip, set us back 60 bucks. Frankly, maybe my "recent" memory of prices is a couple of decades old, but that provided quite a bit of sticker shock.
We just topped up our stock of coffee. My "go to" (when I'm not splurging on Illy) is Costco Kirkland Columbian Supreme in 3 pound cans. The price has increased by 4 bucks over the past three weeks. About a year ago it was three bucks and change a pound and now it's over $7 a pound.
I'm old enough to remember when restaurant menus had adhesive tape over the prices so stat new prices could be written weekly (now a days, some restaurants simply provide a QR codde to access their current pricing.
Some of us have seen this movie before, but some are just too young.
Jeff
No. of Recommendations: 2
This morning, my wife had a doctor's appointment so, in case of a blood test, we didn't eat breakfast before leaving. We ate at a diner near the doctor's office (nothing special, a couple of omelets and two cups of coffee) which, after tax and tip, set us back 60 bucks. Frankly, maybe my "recent" memory of prices is a couple of decades old, but that provided quite a bit of sticker shock.Yep. While we've had maybe 25% inflation (CPI) since COVID started, restaurant prices have jumped by over 100% in many cases, especially fast casual types. But even the mid-almost-high-end places where entrees used to be $30-50, you commonly see entrees at $50-100+ nowadays.
We just topped up our stock of coffee. My "go to" (when I'm not splurging on Illy) is Costco Kirkland Columbian Supreme in 3 pound cans. The price has increased by 4 bucks over the past three weeks. About a year ago it was three bucks and change a pound and now it's over $7 a pound.Ironically, coffee prices seem to be quite stable over the years. I have a tool (keepa) in my browser that shows Amazon price history over the long term, and most of my favorite coffees don't show much of a price increase at all. For example, this one -
https://www.amazon.com/Lavazza-Espresso-Coffee-Med...shows a range roughly around $15 since 2016. Sometimes on sale for $10 or so, but usually around 15 for all those years. And these Illy K-cups (for those who don't brew the old fashioned way) -
https://www.amazon.com/Balanced-Arabica-All-Natura... have a very stable price since 2017, around $9-10, again sometimes on sale. I don't know how to post screenshots here, otherwise I could show the keepa graph that is generated by the tool.
Some of us have seen this movie before, but some are just too young.This is a FACT! Very few people have any clue what real inflation is like. They complain about 6% and 7% mortgage rates, and don't realize that 8-10+% was normal for many, many years when we were growing up. Heck, our first mortgage at 8.5% was a veritable bargain at the time! Sure, we just had 2-3 years of slightly higher inflation, but it was after a few decades of very low inflation, and it stopped rather quickly. If we see REAL inflation again, I suspect many youngsters will have a very hard time dealing with it.
No. of Recommendations: 2
Real inflation:
Back when I was in kindergarten, I found a 5,000 Deutchmark postage stamp on the ground - which started me collecting stamps as a kid.
A number of years ago, I bought a $20 billion banknote in Zimbabwe for a US buck - and probably overpaid (but it did have a lot of cool anti-counterfeiting stuff built into it)
The cruzado was the currency of Brazil from 1986 to 1989. It replaced the second cruzeiro (at first called the "cruzeiro novo") in 1986, at a rate of 1 cruzado = 1000 cruzeiros (novos) and was replaced in 1989 by the cruzado novo at a rate of 1000 cruzados = 1 cruzado novo.
In 1998, we decided to spend New Years in Rio de Janiero, Brazil and the currency was the cruzeiro with a "parallel" (black market) exchange rate of about 115 to the US dollar. When we returned to repeat the experience in 1989, the cruzeiro had been replaced by the cruzado at the rate of 1000:1. In 1993, there was another devaluation and 1,000 cruzeiros = 1 (cruzeiro) real.
While we shudder at 10%-15% inflation and how it destroys savings, imagine the above real-world examples.
Jeff
No. of Recommendations: 6
While we shudder at 10%-15% inflation and how it destroys savings, imagine the above real-world examples.
The introduction of the real to fix the problem (fixed for quite a long time, by South American standards) was brilliant.
To paraphrase my memory, which probably has some very substantial flaws, but the gist of it:
Rather than simply replace the old currency with a new one which would probably have the same problems, they started publishing a credible inflation index, so that you could look up the real price of something any time even though the still-official old currency continued its tumble. It was the ratio between the official currency and the "real" price. Companies started writing contracts in the "real" currency. With government encouragement this practice gradually took over from the old currency, eventually wages and taxes, and replaced it.
It sounds like a bit of magic, but I suspect the key was probably that quoting a price in the "real" currency for a future receivable did not include anticipation of inflation, so overall consumer expectations of inflation plummeted.
Jim
No. of Recommendations: 0
Yet they manage it.
I was in Brazil in 1985, with the cruzeiro at 5000-5400 per US $. Black market rates broadcast daily on the news. I'd have 100k cruzeiros in cash as I didn't use a credit card.
No. of Recommendations: 2
This morning, my wife had a doctor's appointment so, in case of a blood test, we didn't eat breakfast before leaving. We ate at a diner near the doctor's office (nothing special, a couple of omelets and two cups of coffee) which, after tax and tip, set us back 60 bucks. Frankly, maybe my "recent" memory of prices is a couple of decades old, but that provided quite a bit of sticker shock
We tend to eat out often but I'm more of a cinnamon roll, muffin, or chicken&biscuit type of breakfast person since I can't stand eggs, maybe OD on them as a kid.
The other day for the first time in maybe 30+ years we stopped at a Denny's for breakfast due to having a coupon. My wife enjoyed her meal. Mine was ok but I like the pancakes better at the diner down the road. Anyhow for the 2 of us in Arizona, it was $40 before a tip. We can usually do lunch for that or less in the places we frequent. So I can see how $60 can be possible. Someone is making a ton of money since food hasn't gone up that much.
Rich
