ABC Interprets Lower McDonald's Sales as Recession Indicator

     Are we in a recession? Ask Big Mac.

     That’s the newest economic indicator, according to an ABC report about lower McDonald’s sales for December.

     “So, if Americans are saying good-bye to fast food, could we be saying hello to a recession?” asked ABC correspondent Bianna Golodryga, on the January 29 “Good Morning America.”

     McDonald’s Corporation (NYSE:MCD) announced lower sales for December in U.S. stores on January 28, although the company reported a $1.27-billion profit for the fourth quarter of 2007.

     “According to the latest figures, America may no longer be the ‘fast food nation’ that it once was,” Golodryga said. “And, it has nothing to do with going on a health diet, but everything to do with going on a spending diet.”

     McDonald’s didn’t place the blame entirely on a slumping U.S. economy, but also faulted colder weather and higher energy prices for the sales decline. But Golodryga still managed to show “shock” from the monthly report based on how much McDonald’s is consumed annually.

     “While the jingle may say so, Americans don’t seem to be ‘lovin’’ McDonald’s these days,” Golodryga said. “The world’s largest restaurant chain reported its worst monthly result in almost five years – saying December sales were flat. Pretty shocking considering the fact that every day one-quarter of the U.S. population eats fast food, gobbling up $120 billion of the stuff each year. That’s 35 million pounds of fat from Big Macs alone.”

     The media have demonstrated they have a knack for gauging our economy, not by examining traditional economic indicators, like gross domestic product, unemployment, new construction, durable goods, etc, but by pointing to more non-traditional data.

     In July 2007, ABC’s “World News” anchor Charles Gibson used the price of Starbucks (NASDAQ:SBUX) coffee to warn of economic hardship, despite a lowering of gas prices at the time. On ABC’s Oct. 17, 2007, “Good Morning America,” Golodryga managed to connect sweater sales to a down-spiraling economy. And, in December 2007, “NBC Nightly News” reported that lower RV sales were a precursor to a recession.