Maybe those fretful upscale retailers are right to worry about their customers’ stock portfolios. The Wall Street Journal deemed luxury retail one of the most unstable sectors of the consumer economy — actually calling it “manic” — owing to the way its rarefied consumer base makes purchasing decisions.
According to the paper, those decisions tend to be hinged on the short-term movements of the stock market (which is volatile enough these days) instead of on the economy as a whole. With wealth and luxury spending so tightly linked, it means little normalcy for that particular segment of retailers and manufacturers. In light of the recent proclamations about high-end retail’s supposed economic immunity, this new detail makes the alleged bubble seem a lot less impenetrable.