Some China watchers suspect that the highly publicized ouster of flashy politician Bo Xilai (above right) and the murder charge against his charismatic wife, Gu Kailai (above left), known for her taste for finer things could mean the appetite for luxury goods among the newly Chinese affluent might be on it's way out.
Australian hedge fund manager John Hempton of Bronte Capital sees a cultural shift in the making. As Hempton explains, “A half million dollar watch no longer says ‘look at me.’ It says ‘look at me, I am a kleptocrat.’”
"Bling," such as showy Swiss watches, will now mark you as an enemy of the people, Hempton says. He points to an article in the Daily Telegraph, which reports that a Chinese activist has taken to publishing online photos of Chinese officials sporting watches worth several thousand dollars each, and drawing the connection to corruption.
One company at special risk is Richemont because it has broad exposure to China and has witnessed torrid growth for it's name brand watches, like Vacheron Constantin, Baume & Mercier, Jaeger-LeCoultre, Cartier, IWC, Piaget, and Panerai.