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Starbucks: Crisis response done right

Quest's Profitable MomentTwo black men were arrested at a Philadelphia Starbucks for...

Posted: Apr 20, 2018 12:22 PM
Updated: Apr 20, 2018 12:22 PM

Quest's Profitable Moment

Two black men were arrested at a Philadelphia Starbucks for doing absolutely nothing. A photograph of the incident was seen around the world.

It was a potential disaster for Starbucks. Recognizing that, CEO Kevin Johnson immediately came out and announced that Starbucks was going to put it right.

He said the store manager had been wrong to call the police. It was wrong to have the men arrested. The only ones not in the wrong were the two men waiting inside the Starbucks.

Not only did Johnson apologize, but he announced that 175,000 Starbucks employees in the United States would undergo unconscious bias training.

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You could say it was a textbook example of how to handle a PR disaster. But it's deeper than that for Starbucks.

If you look at the company's values and mission statements, the CEO was simply practicing what Starbucks preaches.

In trying to put things right, Johnson was making sure the company was living up to its principles.

This is a lesson for every other CEO out there: Don't head for the hills at the first sign of disaster like Facebook and Equifax. Take a sip from Starbucks' cup and face it head-on.

Do what's right. Your investors and your customers will thank you for it.

Big banks are minting money

President Trump has been very kind to America's biggest banks. His corporate tax cut has fueled blockbuster profits. And the recent market mayhem, which Trump played a role in, was good for banks, too. Morgan Stanley and Bank of America reported record earnings this week. And JPMorgan hauled in the biggest quarterly profit by a US bank. Ever. Yet the mega profits haven't impressed shareholders much. They know markets won't be volatile forever. And tax rates won't keep shrinking. The underlying business - lending money - will need to accelerate for banks to sustain the success. - Matt Egan

'Fearless Girl' is moving

The fate of the "Fearless Girl" statue is finally resolved: After spending more than a year staring up at the iconic "Charging Bull," the bronze statue will move to face the New York Stock Exchange by the end of the year. It's not a big change - right now, both "Fearless Girl" and the "Charging Bull" are in a small park a few blocks from Wall Street and the NYSE. But the relocation means that the statue, which has become a beloved symbol of empowerment and the push for gender equality, is ensured a long-term home in Manhattan's financial district. The bull might move, too, though the city hasn't said when or where. - Danielle Wiener-Bronner

Weak dollar is good for big US companies

Trump accused China of playing a currency devaluation game - days after the Treasury Department failed to call out China for currency manipulation. The dollar has lost ground versus the yuan and other currencies this year. That's great for blue chips like Oracle, FedEx and Nike. A weaker dollar makes their products less expensive overseas and lifts the value of international sales once they are translated back into dollars. But how much longer will the greenback stay in the doldrums? More Fed rate hikes should boost the dollar. Trump even said in January the dollar will get "stronger and stronger." - Paul R. La Monica

'Black Panther' comes to Saudi Arabia

Saudi Arabia ended a decades-long ban on movie theaters with a screening of Disney's "Black Panther" this week. The opening of the AMC theater in the Saudi capital of Riyadh is part of an economic overhaul that the kingdom hopes will spur growth and diversification, and reduce its economic dependence on oil. More theaters are expected: Both AMC and Vue International plan to open dozens of cinemas in the coming years. - Jill Disis

Quick takes

St. Louis Fed President James Bullard told Quest on Wednesday he worries that the flattening yield curve means a recession is on its way. Meanwhile, Trump picked a vice chairman and a Fed governor to fill two more empty seats on the Federal Reserve Board.

China introduced a huge import charge on US shipments of sorghum, a grain that is used to feed livestock and make a liquor that's very popular with Chinese drinkers.

Toys "R" Us rejected a $675 million bid for 200 of its remaining 735 US stores. Isaac Larian, the billionaire toymaker behind Bratz dolls and Little Tikes, said he'd keep fighting to buy Toys "R" Us.

Netflix added 7.4 million subscribers in the first three months of 2018, the vast majority of them outside the United States. Netflix now has 125 million subscribers.

Amazon has more than 100 million Amazon Prime subscribers around the world, Jeff Bezos told shareholders in an annual letter. And Amazon is expanding its footprint in physical stores, partnering with Best Buy to sell smart TVs.

What's next

GE's financial report: General Electric will report its first-quarter financial results on Friday, and will hold its annual shareholders meeting on Wednesday. GE faces a mountain of problems, including a ton of debt, a pile of legal troubles, the biggest pension shortfall in the S&P 500 and a cash crunch caused by decades of bad decisions. GE shares are down 20% this year.

Facebook faces investors: Facebook will report earnings on Wednesday, facing Wall Street analysts for the first time since its data privacy scandal erupted in March. CEO Mark Zuckerberg survived his testimony before Congress earlier this month, but analysts could ask tough questions about how Facebook plans to restore customers' trust without angering advertisers.

New York Coronavirus Cases

County data is updated nightly.

Cases: 2377102

Reported Deaths: 54927
CountyCasesDeaths
Kings31743610717
Queens30477510139
Suffolk2265743511
Nassau2059713244
Bronx2013986686
New York1610064600
Westchester1404812328
Erie986281880
Richmond853971901
Monroe777031155
Orange54325887
Rockland50716768
Onondaga45521711
Dutchess33633483
Albany28279368
Oneida25589544
Niagara22031382
Broome21606385
Saratoga18342186
Ulster16274271
Schenectady15199214
Rensselaer13209154
Putnam1177995
Chautauqua10815155
Oswego9541101
Chemung8991145
St. Lawrence8831115
Ontario848697
Steuben8309156
Cayuga7846100
Sullivan777381
Jefferson739071
Wayne690477
Cattaraugus668296
Genesee6028127
Herkimer5972116
Tompkins590159
Clinton561534
Madison535697
Fulton524797
Livingston515266
Montgomery5032133
Cortland479469
Warren465776
Columbia4613107
Tioga437667
Chenango415686
Otsego414551
Allegany398692
Greene392483
Wyoming389154
Washington388562
Orleans360384
Franklin347516
Lewis316436
Delaware304340
Seneca245759
Schoharie206520
Essex193229
Yates138726
Schuyler127216
Hamilton4073
Unassigned12731
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