Ok, I've had a version of this on for the last few months. The idea is that consumers will feel the pinch big-time, and this will lead them to go shopping at more bargain-basement places, whilst leaving the middle market and premium market in trouble. So far i've played it by going long WMT and MCD, and short stuff like TIF, JWN. Since the latter have moved down quite a bit in recent months, I am now looking for less obvious candidates on both the long and short side. Here are my selection criteria: Longs: Strong balance sheet (low debt) Low-end/bargain/discounter market segment (e.g. Wal Mart) Low costs compared to sector competition Shorts: High debt/weak balance sheet Premium mid-market, or high-end luxury market segment High cost-base Ideal short candidates would be in danger of bankruptcy in the next 1-2 years. Ideal longs would be best of breed businesses. I invite suggestions for stocks to put on for this trade.