Regardless of what state media claims, China appears headed for financial trouble. Recent circuit-breaking events have shuttered Shanghai markets and caused unprecedented capital flight. Many sectors (from oil to construction to automobiles) have felt the pain of shrinking China, but one industry remains dangerously exposed. Estimated trillions of dollars have been wiped clean from world markets since the start of 2016. The luxury goods industry bet big on rising fortunes and with brands like Burberry, Prada, and Michael Kors reporting losses even before the recent stock declines, the year ahead looks perilous at best.
An economic overhaul from export-based global manufacturing to consumption-centric services will not happen without a system shock. Luxury, a business that depends on consumption (but first and foremost, the existence of high net-worth individuals), is sure to face challenges in the months ahead. Fashion-industry journal BusinessofFashion.com covered this precise topic during a recent panel in Hong Kong. Watch the video below for expert opinions on what China's impending financial collapse means for the future of luxury goods: