Brennan's research suggests that many luxury consumers are people benefitting from new wealth. And cutbacks on the Street could mean some belt-tightening.
She adds, Coach and Tiffany might have to diversify their product lines to get consumers excited about their products.
Jeff Macke sees luxury retail a bit differently. These stores are very popular in other countries, he says, and foreigners are actually coming to the US just to shop. To them it's as if the stores are “giving away” the merchandise because the dollar is so weak. He says the trade is to stay long Coach, because he feels it’s simply a “great brand.”
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Trader disclosure: On Oct 5, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Macke Owns (ATVI), (INTC); Najarian Owns (VCLK), (NDAQ); Finerman Owns (GS); Finerman's Firm And Finerman Own (HD); Finerman's Firm Owns (BWS), (GE), (WMT), (TGT), (PSS), (COP); Finerman's Firm Is Long (MSFT) Calls; Finerman's Firm Owns S&P 500 Puts; Finerman's Firm Owns Russell 2000 Puts; Seygem Asset Management Owns (BX), (BBD), (EEM), (EWZ), (GLD), (ITU), (TWX), (CFC)