On Starbucks, Bad Coffee, and the Abattoir of Investing

Denninger explains the current price-to-earnings ratio of Starbucks in simple terms.


A commenter, Capeman, disagrees on the quality of Starbucks:  You're clearly wrong on this Karl. Starbucks coffee tastes nothing like battery acid... it tastes like burnt ass.

I am happily unable to confirm that comparison.  I have, occasionally, gotten Starbucks' coffee, unembellished, or in a double espresso, in desperation, when trapped at a mall or an airport. I didn't think it was that bad.  I drink multiple cups pots of coffee every day and never complain, unless it is decaff, which tastes and smells like someone filtered it through a well-used ashtray full of old cigarette butts.  I am not a connoisseur.  More like a coffee 'possum. 

Anyway, Denninger mocks: 

Naw, nothing to see here with a 7,554 P/E

He continues laying down sarcasm like a '70s burnt orange shag carpet:

Now to be fair the company's stock IS only selling at 3.7x sales, which is better than some.  But it also has a profit margin of a hefty 0.06%, if I'm reading the latest data on Yahoo Finance correctly, which is obviously a highly-sustainable business.  After all, out of nearly $15 billion in sales it had a prodigious $8.3 million in net available to the common shareholder.

With insanity like this, how can anybody think that the stock market is a good place to invest?  It's a financial killing field.