In a weekend story, the NYTimes reports that wealthy people, whose spending helped power whatever economic recovery we’ve enjoyed, are closing their wallets again. The report includes the observations of a luxury car dealer in Arlington:
Last year and early this year, when the major stock gauges were rising, “everybody seemed to be a little bit more optimistic,” said Tom Hauswirth, general manager and partner of Moritz Cadillac, BMW and Mini in Arlington, Tex., near Dallas.
“Then I think everybody was affected when they saw the stock market go below 10,000,” he said. “Even though it may not affect their ability to buy or not, it affects their thinking.”
Mr. Hauswirth said that those who had recently bought new cars were sometimes fearful of being labeled as conspicuous consumers. A few, he said, insisted on buying new cars in the same color as their old models.
“They didn’t want their employees to know they bought a new car,” he said. “It doesn’t look good during a wage freeze or when they’re cutting people.”
Moritz laid off about 15 percent of its sales staff last year, and Mr. Hauswirth said that he did not yet feel comfortable hiring back until sales improved more.
Coming next, most likely: higher taxes on these folks. That should really kick-start the ol’ economy.