It appears that luxury as an entire category may be about to take a hit just like a lot of other goods and services. Up to now, conventional wisdom dictated that an almost sure-shot way of surviving the crunch in the US market was to trade up in the kind of diamonds and jewellery one dealt in. The high end, the buzz went, was not affected by the sub-prime mess. Indian diamond dealers and export production jewellery manufacturers have, as a result of this reasoning, all been busily trying to move their operations upmarket.

It might all be to no avail. This report suggests that because of their middle class roots, a majority of America’s wealthy are focussed on getting value for their money. They are going online to save money! According to the report, they spent $65 billion online – and saved a staggering $35 billion by having avoided brick-and-mortar establishments! The luxury goods and services they bought online ranged “from hiring a private jet to buying a Burberry raincoat or a music system from Bang & Olufsen”. But going online isn’t the end to one’s troubles. Tiffany and Blue Nile have been downgraded by Merrill Lynch due to the fact that it foresees reduced spending on big ticket items like jewellery.

On top of all this, here comes this report suggesting that luxury real estate in the US might finally be cracking. High or low, there doesn’t seem to be a safe end to run to for shelter.