Economy
Flaunting, sales of luxury goods down
European vacations are not mentioned at holiday cocktail parties. Purchases of luxury automobiles and vacation lodges have been put off. The clubhouse exchange of luxury bric-a-brac, customary at the holidays, is toned down.
Across office suites, dinner parties and foundation boardrooms, inconspicuous consumption is the new recessionary etiquette.
To do otherwise at a time when neighbors and family members getting pink-slipped is considered simply poor taste. The tokens of success – a Cartier timepiece, Christian Louboutin shoes – are being worn more discreetly, or not at all.
"It's sort-of crass," said Grant Yarber, chief executive of Capital Bank in Raleigh. "For a lack of a better term, it's really in-your-face, and there's really no need to do that to anyone."
Some have dubbed it luxury shame. Others say it's anxiety and fear over dwindling fortunes. Either way, many wealthy consumers are "feeling a tad defensive about luxury," noted a recent report issued by the Luxury Institute, a market research and consulting firm in New York.
But the sensitivity also underscores the sudden vulnerability that lawyers, doctors and executives feel in the wake of Wall Street's collapse.
Nearly 60 percent of the rich – defined as having a net worth of at least $1 million – plan to spend less next year, according to a fall survey for "Elite Traveler," which bills itself as the private jet lifestyle magazine. The luxury consumer confidence index, as measured by Unity Marketing in Pennsylvania, has dropped by more than half its value to an all-time low.
Luxury sales fell 23 percent in the five weeks ending Dec. 6, according to SpendingPulse, a data service of MasterCard Advisors. First quarter sales at luxury department store Neiman Marcus fell 14.5 percent for stores open at least a year, leading declines at rivals Saks and Nordstrom.
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