The fall in luxury spending is not to blame for Starbucks's troubles. In fact, spending on low cost, luxury items goes up in a recession. For example, the rev

The fall in luxury spending is not to blame for Starbucks's troubles. In fact, spending on low cost, luxury items goes up in a recession. For example, the revenues of posh cosmetics companies generally increases in a recession. This is because people cannot afford to buy a high-price product like a new car, but they still want the post-spending feel-good factor so they buy a lower-priced luxury-brand lipstick instead.