.......since the other one got moved into the Archives.

From today's Klumbeein, page E1~

Yeah, things are tough at Starbucks. (I'm patronizing one right now though.) I like Peet's too, except that the one near my house in NE Portland was kept as cold as a meat locker this summer so I went only a few times. And they don't give you WiFi til you've made a purchase; when I was there, I used the Starbucks WiFi from across the street!

(I just read the book "Starbucked" by Porlander Taylor Clark. It was written before the recent decline of Starbucks' fortunes. Interesting history there. Did you know that the founder of Peet's (a Dutchman who landed in Berkeley) mentored the original founders of Starbucks? The last founder of Starbucks wound up acquiring the Peet's chain in the 1980s; then he kept Peet's and sold Starbucks to Howard Schultz! So when you visit a Peet's, you are patronizing the original owner of Starbucks...)

The Starbucks stores I visit still seem pretty busy, actually. They certainly aren't ghost towns. I think Starbucks has become such an institution that they won't be going away anytime soon. They are expanding internationally, too. International sales have still been fairly strong and they helped prop up Starbucks' recent domestic sales troubles.

Andrew

Starbucks has been my most successful stock, and the only one I semi-actively trade. I keep 500 shares that I acquired in 1989 at a cost adjusted basis of $1.33 a share, but I've bought and sold 2000 additional shares over the years; buying when the value (P/E, PEG) was low... selling when the stock price got ahead of itself.

It is a fundamentally wonderful company, extremely well run, incredible business model, an absolute catagory killer. And while you may think there's a Starbucks on every corner, consider that there are just under 16,000 Starbucks worldwide, but just over 30,000 McDonalds. And Starbucks doesn't have anywhere near the competition Mickey D faces with BK, Wendys, JackintheBox, just in the burger catagory alone, without figuring the other fastfood giants.

But Starbucks was a huge target in this recession.

The 97% drop is somewhat false since it includes a huge one time charge. It would be like saying you personally spend $40,000 per quarter, just because the figures reflect the quarter in which you had to pay for a new roof. One time thing.

The same-store sale drop of 8% is true troubling number... reflecting the troubled times. Somewhat fewer people are visiting Starbucks, and those who do are spending less. In the quarter reported, gas prices were through the roof. It was an easy decision for a lot of folks to swap the daily grande mocha frappachino for a large coffee leaveroomforthecream.

But Starbucks balance sheet and fundamentals are solid. I certainly wouldn't sell the Starbucks I own now... and I'll start nibbling back into the stock over the next 12 months, buying a hundred or two each time I find mayself saying "dang,this has to be the bottom". No rush. It'll be a while before the economy (and Starbucks) bounce back.

[lately I am starting to trade Apple.. don't know if it will continue. But again a wildly successful company who's stock price bounces like a bungee. In the past 6 months I've bought at $130, sold at $185, bought again at $90... and am holding.]

Never darkened Starbucks door or drive-thru. I LOVE the local coffee stands where time and effort are put into making me a drink.

And the "local coffee stands" are grateful for Starbucks existence. Starbucks has created the market for expensive coffee. The number of independent coffee houses has continued to increase nationwide since Starbucks opened up their thousands of stores. The wise coffee houses open up next to or across the street from a Starbucks.

Andrew

I go to Starbucks (Tanasbourne) almost every day. Since I am a Vet, my coffee today was free.

Which StarBucks in Tanasbourne.? I think there are four of them. The newest one on Cornell next to Nice Rice just burned down recently and they decided not to re open it.

I'm guessing the one at Barnes & Noble? Used to be 24 hour I think (most of those have had their hours scaled back).

Andrew

Yes, it the one next to Barnes & Noble. I read the newspaper and do the puzzles(wonderword, Jumble and sometimes the SUDOKU) , listen to Thom Hartmann and drink my coffee black no cream and sugar. I've gotten to know may of the regulars and Starbucks employees.

And yes, they are no longer open 24 hours.

I simply don't understand the gourmet coffee crowd. You are a breed unto yourselves. A cult thread interwoven with a need for a special caffeine high.

I guess I'm not moved by the sound of an espresso machine or the need for a boost in the morning to get hyped for the day. It's one less vice on my plate.

Spare change? I got plenty.

Well, Chris, I don't even DRINK coffee (my drink is a hot chocolate). I am self-employed and live and work alone but am often on my laptop. I get stir crazy being home all the time, working on my websites or photos. Like many others, I've found Starbucks a very comfortable place to go work away from home.

Believe it or not, I can sometimes concentrate better with all the noise. (Not always; big pet peeve is someone talking on their cell phone.) Like Pete, I've got a regular Starbucks and have gotten to know the baristas there a bit. Sometimes, it's nice to have people to talk to.

Portland is rich in independent coffee houses, but I have yet to find one I'm as comfortable with as my local Starbucks. (We've had threads about this before.) Suffice to say, I've given them a fair shake I think. I wind up going back to Starbucks.

Andrew

I went into a Starbucks here in Eugene for the first time in over 6 months. My friends and I have a nickname for it "Charbucks" Why? If you buy a house coffee, not a latte, not a mocha just a cup of joe, the company over-roasts their beans making the coffee very acidic and bitter. So yeah tons of Splenda and 1/2 and 1/2 to make it palatable. I will agree, without Starbucks, "gourmet" coffee would really be a novelty. As for local shops that benefit from their existence, without a doubt they are around to draw those disillusioned with marketplace glut. And those who prefer good coffee.

That said, Eugene has some good coffee houses. Full City, Allann Brothers, and others all have better coffee than Charbucks. My favorite Charbucks item is usually only available in the summer anyway. Their black ice tea w/o sweetner is sublime.

And yes I put sweetner and milk in my joe. I am not a purist. I don't drink coffee for the flavor. I drink it because I am addicted to caffienne. ADD does that.

All sorts of things happen at the Tanasbourne Starbucks: Employers interview prospective employees; Teachers correct class material; ministers review nuptial plans with the couple; contractors review construction plans with customers; etc., etc.

I am a junkie for the stock.... and for a well made espresso, but I have the caffeine junkie's version of a Hummer. A "super-automatic espresso maker"... grinds the beans, fills the basket, infuses the beans with 1/2 oz of steam to prime them, pauses, then runs the exact # of oz. you specify through the grounds, dumps the grounds, and rinses the basket, resetting for the next cup!

The Starbucks stores are for social meet-ups only.

(And as a forgotten-by-me comedian said so aptly, if you're putting cocoa, caramel, almond syrup and whipped cream in your coffee, its not coffee. It's a friggin' milkshake!)

Andrew like you I work from home and am self-employed but the big difference is I like being in my house 90 percent of time. One big factor is my wife-aka my business partner.

When both our kids started to go to school full time we thought we would get out more and visit the local shops for lunch and or brunch. Hasn't happened.

We began to build up our clientele and ironically many of those clients wanted to meet at Starbucks. I soon found other more quiet local coffee shops to have my meetings. But those meetings happen infrequently so being home is perfect.

Today is a great example of why I love working from home. It's rainy and windy. We sent the kids off to school and my wife and I can settle into our work routine. Or in some cases I'll head back to bed because I can.

The only thing I have ever ordered at Starbucks has been the hot chocolate. Give credit to Starbucks for creating a lucrative market and for spurring on so many other local coffee shops and cafe's.

Although Starbucks's profits have dropped quite a bit, they are still making a profit. Why is their current situation a big deal?

When me and my dad had the tavern we served Allann Brothers roasted coffee. They were farmers and serious about their "plain ole joe" and they raved about Allann Brothers coffee.

Me? I like the very occassional coffee. Either a latte or a carmel macceado sp?

Although Starbucks's profits have dropped quite a bit, they are still making a profit. Why is their current situation a big deal?

Because they're not making as much profit as they said they would. As I understand, if you're an investor, you invest in a company that says they plan on making $100 million a quarter or whatever versus a company that plans on making $5 million a quarter. If the former company only makes $5 million in profit, the investor will pull their money out and invest it elsewhere. We then hear about how bad the economy is because people decided they can't afford $4 a cup coffee drinks (but we don't hear enough of how bad the economy would be if they kept buying the drinks and stopped paying their mortgages).

However, I personally think this is all absolutely disgusting, and the reason the world got itself in this mess to begin with. $5.4 million bucks profit is a lot of coffee. It's easy to look at the figure and think "revenue," but the two are different.

With the economy in the crapper, people are scailing back on their morning coffee.
It used to be that tossing out 4 buck for a mocha was no big deal, now people are saving those 4 bucks.

I just got the pink slip at my job a week ago!(6 years at the same company, and now I'm gone) No more Starbucks for me! I'll brew my own coffee, which tastes a hell of a lot better than that crappy Burnt tasting coffee that starbucks serves!

You really learn what's important when you lose your job. Hopefully the wait for you Beano will be minimal.

However this begs the question. Why spend 4 bucks on a caffeinated drink every morning? Start doing the numbers and in a year you're spending $960 on coffee just M-F.

During the good times when the economy is strong is the ideal time to be thrifty at some level. Maybe do coffee three times a week and not 5 or 6. So when the hard times come, and they do come, it won't be such a shock.

While I don't drink coffee, I do have to get out of the house to read the paper, get work done and/or catch up with reading. Trying to do it all at this desk in front of the computer (or elsewhere around the house) is a motivation killer. I can understand perfectly why one would have a coffee shop in their routine (although I've no idea why people would want to drink that gawdawful tasting brown fluid when they can be drinking diet coke instead! ).

Yup Losing my job at Tektronix sucked, but somehow I knew it was coming! They can bring in Temp workers for cheaper and not have to pay them benefits. I think thats thats the new wave of the future for big companies like Tektronix, temp workers from Temp agencies.

Even the big temp agencies like Manpower, Kelly Services and Administaff are doing poorly (stock-wise)in these weak economic times. Companies tend to hire temps when they have too much work and can't fill the positions, not when they have too little work. The temp-worker industry is considered highly cyclical -- doing worst in bad economic times / best in great economic times.

Temp workers are frequently covered by benefits from the temp agency, which passes on those costs in employer fees. And training new temps is so expensive for the company hiring them, that it is usually MUCH cheaper to retain currrent employees rather than replace them with temps.

I do not dispute Beano's observation that Tek may be doing this, but it is a very poor business decision, and one that is NOT common. If true, it suggests that either Tek's full-time employees where getting mondo way above the norm benefits that tipped the scale in favor of temps, or that the management of Tek is incredibly incompetent.

So sell your Tek stock too.

All this depressing Economic talk. I know, there is a reason for it. I have part of my retirement as a Washington State employee in something called the Washington State Investment Board. Or the WSIB. It is a very diverse fund, has been for almost 75 years now Wa state started this thing in the mid 30s. Over the years they have generally done quite well.

I hesitate to pull my money out of it. I havent recieved my statement for 3rd quarter yet, but the website said that it was minus 8 just for Qu 3. They took an extra hit in Qu 2 because they had some money in Bears-Stearn.

Minus 8 is something to be proud of right now.

If they are at -8 for the quarter, it is highly likely that they are heavily invested in bonds, particularly government bonds with a guaranteed fixed income... 60-80% of the total portfolio.

One of the best arguments to keep our social security out of the hands of individual investors is that individuals will (perhaps foolishly) risk a great deal more of their money. They insist that those who invest for them, like retirement funds, be much more conservative. And I suspect that everyone who sees retirement coming up fast in the rearview mirror would opt for "more conservative" these days... now that we've seeen how bad a "bad market" can be.

"So sell your Tek stock too."

Can't... about a year ago Tek was acquired by Danaher.

Crap. I guess I own a bunch of Tek. (I'm long Danaher -- huge conglomerate with a nice dividend!)

Hey Danner, the Temp agencies is VERY REAL deal at Tektronix. They had channel 2 news in the Parking lot of Tektronix last week when they blew out around 300 employees. The woman I sat next to had worked at Tektronix for 25 years, and they walked in and blew her out. She was so desperate to keep her job, she tried bargining with her boss, begging and pleading to stay. Finally they had security come in and escort her out. From what I understand, all 300 workers that were fired are now getting replaced by Temp workers who get their jobs through temp agencies. Pretty damn Pathetic!

The largest employer in the nation is one of those damn Temp Agencies. It's such a sham too. So I am qualified to be a legal assistant. I have my public notary. I type 40+ wpm. I tend towards promptness and professional attitude. Let's say I sign on with Tempselect, Inc. They list me not only for the skilled position I am most qualified for but ALL positions, including manual labor (nothing against it but I've been there and done that). If you refuse to work these lower skilled jobs, you get (at least in one of these companies) a three strikes you're out. Refuse a job 3 times and you're fired... from a temp agency. Ok... yeah sham...