The question is how long the affluent consumer can continue to defy the world’s economic gravity.
The argument for luxury is basically what I call the “immunity defense.” The wealthy are immune, goes the theory, to the forces that restrain spending for the rest. The wealthy are getting wealthier, say the proponents. And they’re also becoming more numerous, as China, Russia, Brazil, the Middle East and, yes, Silicon Valley mint new millionaires and billionaires.
A survey from the Harrison Group and American Express Publishing suggests that overall spending on luxury goods and services will grow 3 percent this year. Spending by the one percent will grow 4 percent to 5 percent.
Still, the “immunity argument” fails to recognize one important caveat: the stock market. Stock markets are the main driver of wealth for the affluent and the wealthy, and therefore they are the main driver of luxury or high-end spending.
Tiffany, which sells affordable as well as expensive items, is not as correlated to the stock market as some other hyper-luxury brands. But they still may feel the chill winds from the past few weeks of market falls. More high-end brands could feel it even more.
In its IPO filings, Graff said that half of its sales come from just 20 clients. And when markets fell in 2009, its sales fell by 25 percent.
There is also evidence that China’s luxury boom may be cooling, with bottles of wine, art and other collectibles selling below their peaks of last year. It remains to be seen whether this trickles down to mass luxury items like handbags, shoes and trinkets.
Either way, luxury companies and luxury investors may want to pay more attention to the clouds gathering over global markets right now – even if today’s numbers look good.
-By CNBC's Robert Frank
Follow Robert Frank on Twitter: @robtfrank