The economy must be better, because the rich are spending more. I have to wonder how much of the increase in spending is the result of direct benefit from financial services industry subsidies (ie, people working for large financial firms spending more because they are confident they will have a good to great bonus this year) versus indirect (people feeling better because their stock portfolios have recovered somewhat).
Spending in the U.S. on luxury goods and services spurted 29 percent in the third quarter from the previous three months, as consumers with the highest incomes unleashed pent-up demand, according to Unity Marketing.
Spending among 1,067 consumers with average annual income of $228,800 rose to $18,826 each in the three months ended in September from $14,554 a quarter earlier….
The increase was driven by consumers with the highest income levels, starting at $250,000 a year….The wealthy curbed purchasing earlier this year because of Wall Street job cuts, lower home values and volatile financial markets.
“No question that this quarter’s spending increase is good news for luxury marketers,” Danziger said in a telephone interview today. “Many affluent consumers returned after sitting on the sidelines for a year. However, the richest are few in number, 2.5 million households, so competition will be fierce to win their attention.”…
Gains in confidence among luxury consumers, meanwhile, slowed, Unity Marketing said.
The researcher’s luxury confidence index rose 1.6 points to 75.9, after jumping 18.6 points to 74.3 in the previous quarter. That index peaked at 113.2 at the end of March 2006. Its low was 40.3 in September 2008. It started at 100 in January 2004.