If the jewelry auctions can be considered an economic indicator of the high-end market, then there can be no doubt that the global economy is on an uptick. The recent lofty sales totals reached at jewelry auctions (see pages 66 through 71) show that consumers are willing to shell out the big bucks for the rare and beautiful. While not all businesses operate on the same rarified microcosm of the industry as the auctions, the message holds across the board: There is pent-up demand and people are spending again. The specter of fear that has gripped the world so tightly since the financial collapse is beginning to loosen. The economy appears to be stabilizing — jobless claims are down, GM paid back its government loan early, and with interest, and the stock market has recouped its losses. A recent article in USA Today, “U.S. Shoppers Tire of Holding Back,” addresses the issue of pent-up demand. Consumers are tired of denying themselves their desires. Those who feel more secure about their jobs are beginning to spend again. The caveat is that it is not just random spending — shoppers are looking for good value. That does not necessarily mean a sale. It means consumers are buying items that they need/want that are of good quality that will last and that fit their lifestyle and needs. If a product meets those needs, buyers will pay full freight. The spending may not be as unrestrained as in the past, but it is starting up again and that is good news for everyone.
Article from the Rapaport Magazine - May 2010. To subscribe click here.