When McDonald's (NYSE: MCD) reports earnings, it may be an indication for how badly the spending habits of the working class and middle class in America have been hurt by the current economic downturn. According to The Wall Street Journal, "McDonald's has advantages over its rivals. The omnipresence of its restaurants means customers don't have to go far looking for them, making them a convenient trade-down option that doesn't eat up gas."
That is only an advantage if people can go out to eat at all. It is highly likely that the rising costs of food and fuel are hurting the people at the bottom levels of the income pool much worse than everyone else. It is hard to imagine most families with incomes under $25,000 being able to manage their daily living costs at all.
Even if a meal for four at McDonald's costs less than $20, it may be that a cheaper meal can be made at home.
McDonald's is not the preferred restaurant for the upper classes and it may be moving beyond the reach of the spending habits of those with very modest incomes .
Douglas A. McIntyre is an editor at 247wallst.com.
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