What Does a Recession Look Like?

What does a recession look like? How does it feel? What does it mean for your life and your investments? We explore these questions and more in this week's letter. I have been working on this letter all week, and think you will find it interesting.

But first, one interesting observation and a request for help on a fun project. Last week, I was in Europe. I walked across the street from my hotel in Geneva and was delighted to see a Starbucks. While I initially made fun of people who overpaid for a nickel cup of coffee (the price of my youth, which dates me), eventually I became hooked. I now have a venti decaf every morning on the way to work (venti being the Starbuck's code word for large). When I am feeling particularly adventurous I live on the edge and get a venti half-caf (half regular caffeinated coffee). The price in Dallas recently increased 5% to $1.95 or $2.11 after tax.

I ordered the same thing in Geneva and paid 6.7 Swiss francs which is like $6.43 or three times what I pay in Dallas. The fancy drinks were over $10. And the place was packed at 10 am in the morning. (Memo to returning Starbucks chairman and CEO Howard Schultz, the coffee was decidedly inferior.)

The Starbucks Index

Then I traveled on to Barcelona. Father and son partners Antonio and Kai Torella of Interbrokers (and my new Spanish business associates) indulged me by walking to a Starbucks which was a nice hike away, but on a weather perfect day. There that same venti decaf was roughly $5.70, depending on which exchange rate you use, as it is jumping all over the place. The coffee was better. And the place was…