Carlin: Wall Street Owns Washington

This Is Probably The Most Solid Proof Yet That The World Economy Is Contracting And Upcoming Recession Could be Much Worse Than 2008


McDonald’s Earnings Whiff, And The Company Says Global Same-Store Sales Growth Now Trending ‘Negative’

From the release:

OAK BROOK, IL – McDonald’s Corporation today announced results for the third quarter ended September 30, 2012.

In constant currencies, the Company posted higher revenues and earnings per share compared with the prior year while operating income was flat. On an as reported basis, revenues were relatively flat and operating income and earnings per share decreased, reflecting the impact of foreign currency translation. “While our sales momentum and current financial results reflect today’s challenging conditions, we continue to see significant long-term opportunities for brand McDonald’s and remain confident in the underlying strength of our business model,” said McDonald’s Chief Executive Officer Don Thompson. “We have the right plans in place to drive long-term profitable growth along with the experience and alignment throughout the McDonald’s System to navigate the current environment. We expect near-term top- and bottom-line growth to remain pressured as we focus on driving guest traffic and market share by leveraging our strategies and competitive advantages in response to the global economic, operating and competitive challenges. As we begin fourth quarter, October’s global comparable sales are currently trending negative.”

 

From WSJ: So-called same-store sales are a key indicator of restaurant chains’ strength, and McDonald’s hasn’t seen declines by that measure in about a decade

Chief Executive Don Thompson conceded that the chain is losing momentum world-wide, with sales at restaurants open at least 13 months falling so far in October compared to the same time last year. So-called same-store sales are a key indicator of restaurant chains’ strength, and McDonald’s hasn’t seen declines by that measure in about a decade.

“While our sales momentum and current financial results reflect today’s challenging conditions, we continue to see significant long-term opportunities for brand McDonald’s and remain confident in the underlying strength of our business model,” Mr. Thompson said.

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Comment: This probably is the most solid proof yet that the world economy is contracting despite four years of borrowing and money printing on a worldwide scale. You can’t make bad debt disappear that way. Somebody has to pay it off and means less money for consumers to spend.

 

Marc Faber100% Chance of Global Recession – CNBC

 

 

Peter Schiff: Upcoming Recession Will be Worse Than 2008