Remember last year? That's when year-end bonuses had Wall Street celebrating and Wall Streeters wondering how to spend their riches.
What a difference a year makes. A summer of plunging prices means small, or even nonexistent, bonuses on Wall Street. And that means less money available for the trinkets, the expensive cars, and the luxury homes favored by the masters of the universe.
Realtor Naomi Klein, who says Wall Streeters make up one-third of her clients looking for luxury apartments, says people are holding back on offers.
"Wall Street and real estate are joined at the hip," says Barbara Corcoran, a New York realtor. "When Wall Street lays off, we feel those ramifications in our real estate markets.
Even small luxuries are subject to downscaling.
Richard Hu owns Wall Street Humidor, where a box of premium vintage cigars can cost more than $3,800. These days, he says, even cigar aficionados are suffering through withdrawal.
"When a new shipment came in, I'd go over my client list and I would call maybe no more than ten persons, and I would get rid of my inventory. Now I call maybe 20 or 30 clients," Hu says.
At the Four Seasons restaurant, one of New York's most popular expense account destinations, menu prices have been trimmed in anticipation of an economic slowdown to $59 for dinner, a reduction of about 20 percent.
So, why should we worry about well-fed Wall Street fat cats?
Because, like the canary in a coal mine, when trouble's coming they're the first to go.
"When you lay off people who are making $170,000, that has a big impact on the economy," says Carl McCall, the New York state comptroller.
The market's impact touches lives far beyond the penthouse office suites on Wall Street, as it did during the market downturn of 1987. When we think Wall Street economy, we think New York. But what happens on Wall Street sooner or later affects Main Street.
So, while the prospect of no bonuses might scare Wall Street brokers into cutting back on spending, disappointing 401K statements have the same effect on small investors, and pretty soon the entire economy is in a slowdown.