I could never understand why supposed analysts and smart people held that luxury goods were “immune” economic dislocations. After all, a steady supply of income is needed to fund all purchases, large ones especially so. And you really wouldn’t want to argue that the buying power of the super trust-fund rich would always buoy demand because there are so very, very few of them.
Well, today comes proof that luxury items are far from “immune” to economic downturns. Spending on luxury retail items is off 35 percent compared to last year, by far the largest fall of any segment. This could have all kinds of repercussions for high-end retailers, an in turn, the retail real estate they occupy.
If all Americans have been living beyond their means via easy credit, why wouldn’t that apply to all income levels?
