More great news from our wonderful service economy - a new slew of 12,000 potential Walmart (WMT) workers have just been borne. Lucky us. Of course these people will disappear into the ether of the "new jobs" created by the birth/death model in our monthly BS, err BLS unemployment report. (newest chapter of this fiction available Thursday - hot off the presses) .Within that report these people will be shown as newly employed in contruction trades, finance, or services - some of our hottest groups for job creation  [no, I am serious - the government has been showing in their estimates growth in construction and finance]

As always folks, I do not comment on this monthly report other than realizing it will create lemming-like behavior by the hedge fund computers and NYC traders. Every 30 days I just point new readers to this [May 2: Employment Report] Read point #1 and point #2 in that blog post, and then ignore the spiel that gets spit out every 30 days. As always, listen to the companies - not the government. Let's hear what Starbucks (SBUX) is saying.

Starbucks (SBUX) announced 600 store closures and a further halving of 2009 expansion plans. Of course with that comes about 12000 job cuts and/or job shifts. If the company can deliver on promises to "find workers jobs at other cafes" the number of job cuts could be significantly lower than 12000, however The Street seems to be optimistic executives can wrangle up as much in cost savings going forward as possible. Starbucks jumped after hours about 5% to near $16.50/share, still a far cry from its 52-week high of $28 and just off lows of $15.

Given that, the odds of one company salvaging the other, of Blockbuster resuscitating the struggling business of Circuit City, seemed small. Luckily for Blockbuster shareholders, CEO Jim Keyes reached the same conclusion before he walked the company into the Elvis Wedding Chapel and said “I Do.”

The problem is that these discussions will probably revolve around who has the ability to buy CC, and then the analysts will more or less "invent" a scenario under which the marriage of the two companies makes sense.

From the Financial Times:

On Tuesday, Starbucks took another step toward in its turn around program by announcing that it will shut some 500 to 600 unprofitable stores and slow the openings of new stores. This encouraged some value investors, who've been buying the stock because they think the return of the company's founder, Howard Schultz, as CEO will make Starbucks the new Apple (AAPL). Since Steve Jobs returned to Apple in 1997, he's made it a historic turnaround success.

One of the great fears of any party seeking to close a deal to purchase Circuit City (CC) is that the due diligence would reveal information so negative that potential acquirers would drop their bids. Apparently this scenario is playing out.

Schultz has been working frenetically to turn things around at Starbucks. Since his return to the helm, SBUX has dropped breakfast items from its menu, announced a reduction in planned store openings and the closure of 100 under-performing, company-owned stores. Yesterday’s announcement demonstrates a greater sense of urgency as the once high-flying retailer adjusts to a tough economic environment.

F3Q08 Earnings Call

67% of Ruby Tuesday's (RT) Have No Customer Waits or Waits Under 10 Minutes

(1) S&P downgraded SFD's debt ratings
(2) D.A. Davidson cut its opinion from neutral to under-perform
(3) COFCO, China's largest pork producer announced its intention to purchase a 5% stake
(4) SFD announced a plan to raise $350 million through the sale of senior notes.

Attesting to the chain’s brand loyalty, a Google search will return articles like Nathan’s Hot Dogs Stand the Test of Time, Everybody Comes to Nathan’s and other tribute pages where long-timers tell of their nostalgic, mouth watering experiences at the chain (and make you want to hunt down the nearest location). Nathan’s well stocked condiment bar reminds of being at the ball game, with their own brand of spicy mustard and high quality sauerkraut. Nathan's is also known for it's delicious krinkle-cut fries, which, I must say, perfectly complements the dog.

This is the quantitative take on Starbucks – for a qualitative take; Portfolio magazine profiles Starbucks CEO Howard Schultz in this month’s issue.

True Religion (TRLG) is a (yes - that's right - a retailer!) high end branded apparel maker. Their primary market is in the US.

Well, the price continued to rise for another week hitting multi-year highs before topping out at just below $45.  However, the momentum could not last and the stock has dropped 26% since that high. Today, with the stock trading under $33 per share, Ockham’s valuation-based rating has come full circle and we rate the stock a Buy.

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F1Q09 Earnings Call

My husband mentioned that several athletes had set new records in their LZR Racers, and that some even attributed an edge to wearing the streamlined, body-compressing suits designed with help from NASA, the space people. I perked up because Speedo is licensed by Warnaco Group (WRC), a company whose stock I've owned before, to my benefit (I don't own it now), and which has survived the slowdown in consumer spending better than many apparel companies (its popular "intimate" apparel brands, Olga and Warner, appear to be recession-proof). But the current stock price is well below analysts' price targets. My interest got even keener as we watched Michael Phelps set yet another world record in his spiffy LZR Racer (the waist-to-calf version). I love the fact that Warnaco started out in the 19th century making corsets, and Speedo began in Australia making woolen longjohn-style swimwear in 1928. Progress!