Retailers have been cutting back their inventory as a result of the consumer-spending implosion, and this has affected the luxury retail goods part of the market. For example, LVMH Moet Hennessy Louis Vuitton, the world’s largest luxury-goods company, on Monday said its third-quarter sales slipped 0.6%, reports Christina Passariello and Vanessa O’Connell for The Wall Street Journal.

LVMH, a bellwether for the luxury-goods industry, declined to give a full-year profit forecast even though all of its divisions performed better in the third quarter than in the first half of the year. Overall, analysts say this industry is unlikely to see a turnaround until 2010-2011. (Other retail strategy shifts).

The way that the designer end of the fashion industry has coped is to make a “bridge” label that stands between the high end low end.

Mid-range designer labels such as Tommy Hilfiger, Dolce & Gabbana and Tory Burch are all marketing to the space in between major designer brands and the contemporary market, Katie Weisman for The New York Times explains. This strategy has positioned such designers to prosper even as sales have slowed across the board. (How the retail sector has changed).

For more stories about retail, visit our retail category.

• Claymore/ROBB Report Luxury ETF (NYSEArca:ROB): although it’s up 51.4% year-to-date, it’s still 51.4% off its 2007 high; LVMH Moet Hennessey Louis Vuitton, 4.4%; Nordstrom, 4.1%

Some major assets are priced at 1999 levels, and if the current situation resembles past ones, there may be opportunities on which you can capitalize, remarks Stacy Johnson for Wise Bread.

Case in point: housing prices have been greatly reduced, and commercial properties may now provide better cash-on-cash return – not including tax write-offs that may make them extra enticing.

• iShares Dow Jones U.S. Real Estate (NYSEArca: IYR): up 19.8% year-to-date

• iShares FTSE NAREIT Industrial/Office Complex (FIO): up 17.9% year-to-date

Another example is the stock markets. After the spectacular gains since the March lows, the stock market is still lower than it was prior to January 2000.

• SPDRs S&P 500 (NYSEArca: SPY): up 20.3% year-to-date

If you are one of the lucky few that does have money but doesn’t know what to do with it, luxury items have cheapened. The opportunities found in lower prices don’t come often.

• Claymore/Robb Report Global Luxury (NYSEArca: ROB): up 50.5%year-to-date

In the sage words of Warren Buffet, “be fearful when others are greedy and greedy when others are fearful.” It is also prudent to have a plan in place before you invest. We use the 200-day moving average to choose those areas that could be about to enter a long-term uptrend. You can read more about the trend following plan in our book, The ETF Trend Following Playbook.

For more information on trend following, visit our trend following category.

Max Chen contributed to this article.

Why analysts predicted a 1% decline, sales actually rose 0.6%. Discounts and bargains have helped lure the shy-to-spend consumer, reports Rachel Dodes for The Wall Street Journal.

Ultimately, September sales numbers monitored stores open for at least one year, and this report is a key measure of retailer’s health and consumer spending. Will the positive numbers translate into a merry holiday season for retailers? Yes and no.

Retailers are predicting that they’ll see a 1% drop in sales over the holidays. But this is also an improvement over last year’s dismal showing, when sales dropped 3.4%, the Associated Press reports. Consumer confidence is higher than it was a year ago, and shoppers may be more willing to spend.

• SPDR S&P Retail (NYSEArca: XRT): up 71.1% year-to-date

• Consumer Discretionary Select Sector SPDR (NYSEArca: XLY) up 28.5% year-to-date

• Claymore/Robb Report Global Luxury (NYSEArca: ROB) up 42.6% year-to-date

For more stories about retail, visit our retail category.

In the first half of 2009, high-end retailers have seen good growth patterns, luring many investors to add these names to their portfolios. There’s still a question as to how these names will perform in the coming months, however, as elevated unemployment, weak income growth, and historically high debt levels still plague the economy, explains Josh Lipton for Minyanville.

These retailers have another strategy, though: since the shoppers are mostly staying at bay, the retailers are ramping up cost-cutting efforts. By cutting back on administrative and sales  efforts, the expenses are lower, while the earnings look better.

The question is whether cost-cutting will work in the long term, since many wonder whether Americans have turned over a new leaf in their spending habits. Generic brands and bargain-basement prices are in vogue, but whether it will remain that way has yet to be seen.

The luxury retail ETF has been faring well year-to-date, up nearly 37% – you can’t fight the trend. If this trend reverses itself, have an exit strategy.

• Claymore/Robb Report Global Luxury (ROB): up 36.7%year-to-date

For more stories about retail, visit our retail category.

The rapid recovery in stock prices has consumers and U.S. companies hopeful that a “wealthy” feeling will return and Americans will once again spend, spend, spend. One economist points out that housing is still showing weakness, meaning that it could be awhile before consumers are in a real mood to shop with confidence.

Economist suggest that overall, the economy is recovering and that a bottom in housing may have already been touched.

One thing is for certain: it’s not as though Americans don’t want to shop.

Sandra M. Jones for The Chicago Tribune reports that there are increasing signs of pent-up demand. Consumers are tired of saving their pennies. One study found that one in four women are ready to treat themselves to a new outfit, a vacation, an evening on the town or something new for the home.

Despite that, many consumers still want a bargain if they are going to spend. Perhaps they’ll plan that vacation with Expedia (EXPE) to get a low price, and buy that new outfit at JC Penney (JCP). That could mean that some retail-oriented ETFs will continue to hold companies that have a bent toward value. However, some shoppers are still looking for luxury – investors who want to capitalize on the spending habits of the wealthy can do that with ETFs, too.

• SPDR S&P Retail (XRT): up 56% year-to-date

• Consumer Staples Select Sector SPDR (XLP): up 1.9% year-to-date

• Claymore/Robb Global Luxury Report (ROB): up 31.2% year-to-date

For more stories about retail, visit our retail category.

There have been a number of stellar performers in recent weeks – these are just a few that caught our notice. Bear in mind that wherever you choose to place your money, always have a strategy for both entry and exit, since no trend lasts forever.

Turkey has several factors in its favor: the central bank has reduced rates to its lo a record low, consumer confidence is on the rise and jobless claims are declining. The country’s stocks have recently recovered to pre-crisis levels and it is reflected in the country’s ETFs.

• iShares MSCI Turkey Invest Mkt Index (TUR): up 76% year-to-date; up 19.5% in the last two weeks

Oil is what makes the world go ’round, and the price of oil may continue to rise as economies recover. Once the global economy sees normalcy, some feel that it’s likely that oil will see higher demand and a lower supply, which would naturally result in the higher price of oil and gas at the pumps.

• United States Gasoline (UGA): up 82.1% year-to-date; up 14.5% in the last  two weeks

Coal has a couple of good things going for the sector: reduction in capital expenditure by producers, a weaker U.S. dollar, as well as increases in both steel and electricity consumption. Lobbyists are also fighting on Capitol Hill for more perks for the industry.

• Market Vectors Coal ETF (KOL): up 93% year-to-date; up 14.9% in the last two weeks

In retail, some high-end consumers are increasing their intake of goods. Many countries are reporting rises in exports and trade surplus, and some luxury retailers are quietly discounting items to drum up more business. So far, the tactic seems to be working.

• Claymore/Robb Report Global Luxury (ROB): up 32.4% year-to-date; up 11.9% in the last two weeks

The ETF that tracks regional banks is producing impressive results considering that many believe regional banks are closing or in trouble because of commercial REITs. MarketWatch says strong profits and good reports from large banks has helped buoy the financial sector and regional banks may be along for the ride.

• SPDR KBW Regional Banking (KRE): down 25.2% year-to-date; up 23.7% in the last two weeks

Max Chen contributed to this article.

The sought after salt-water crocodile-skin bag that is forged in France has a waiting list that spans two to three years, and the prize for your patience is an opportunity to spend thousands on one of these objects. While many of its competitors are suffering under the strain of the global recession, Hermes, an iconic brand famous for its silk scarves and handbags, had a remarkably good first quarter, reports Russell Goldman for ABC News.

In fact, Hermes plans to open more stores this year, while competitors such as Gucci are shutting down shops. The secret? Hermes is at the top of the luxury pyramid, and they never overwhelm the market, producing only in limited numbers.

The post-recessionary climate may find other luxury brands copying the Hermes method, which means re-aligning brands with the new values that more thoughtful, careful and selective affluent shoppers will hold, reports JCK  Online.

Nevertheless, analysts do not expect a full recovery within luxury markets until 2011-2012. A wave of consolidation in the luxury industry over the next year or so may materialize as companies try to survive, reports Anne D’Innocenzio for Associated Press.

• Claymore/Robb Reports Global Luxury (ROB): up 12.5% year-to-date; Hermes  4.3%

For more stories on retail, visit our retail category.

High-end stores will begin to offer more economic and less-pricey merchandise, and many chain stores will carry less inventory and fewer brands, reports Stephanie Rosenbloom for The New York Times. Some chains will put self-service computers in stores to allow customers to browse collections or buy out-of-stock items. Retailers will also offer more exclusive items and provide more attentive customer service.

A new business model known as “My Macy’s” will require retailer’s merchandisers and other planners to go into stores to learn what shoppers are requesting, buying or complaining about so they can stock inventory accordingly.

But changes in the industry do come with some drawbacks. Consumers may find items more easily, but their choices may be limited. Stores may also run out of stock more quickly than in the past since retailers will order less to avoid left over inventories. Another trend that could come into effect would be a shorter seasonal transition for apparels.

Analysts and economists predict consumer spending will return to 2007 levels in another 10 years.

• Claymore/Robb Report Global Luxury (ROB): up 7.5% year-to-date

• SPDR S&P Retail (XRT): up 29.2% year-to-date

For more information on the retail sector, visit our retail & consumer category.

Max Chen contributed to this article.

Since 2000, the Middle East has seen growth above 5% and has become the second richest part of the emerging world, according to ETF Grind. But Mideast economies were slower to recover in the beginning of 2009 and there were concerns over the ability of the region to pay down debt accumulated in the good years.

Over the long-term period, there are several ETFs that an interested investor could keep an eye on:

• iShares MSCI Turkey Invest Mkt Index (TUR): up 30.9% year-to-date. Turkey’s economy isn’t tied too heavily to oil. It remains dependent on exports to the EU. The country’s industrial sector can profit from its close proximity to oil producers.
• Market Vectors Agribusiness ETF (MOO): up 36.6% year-to-date. Economic develpment and population growth would make the Middle East would effect global food demand more than elsewhere since the region has little arable land. Middle Eastern countries are already securing land for a steady food supply and will need the necessary equipment and supplies.
• PowerShares Global Water (PIO): up 10.8% year-to-date. Needless to say, the region has a scarcity of freshwater. The Middle East has the biggest market for desalinization plants and expensive water engineering projects. PIO holds 29 global water resource firms.
• Market Vectors Gulf States ETF (MES): up 15.4% year-to-date. MES covers Middle Eastern countries that border the Persian Gulf. It is weighted toward finance, real estate and services. Its expense ratio is 1.00, but it is a pure play on oil related economies.
• iShares MSCI Israel Cap Invest Mkt Index (EIS): up 33.5% year-to-date. Israel has reputable pharmaceutical and tech sectors.
• Claymore/Robb Report Global Luxury (ROB): up 13.3% year-to-date. When crude oil rises again, Middle Eastern royals will be swiping their super platinum cards in purchasing luxury goods.
• PowerShares MENA Frontier Countries (PMNA): up 15.9% year-to-date. PMNA is similar to GULF but excludes gulf nations of Qatar, Bahrain, and Oman. It also has a higher expense ratio. It is broadly diversified with Morocco and Egyptian firms. The fund mainly invests in large and mid caps.
• Claymore/Delta Global Shipping (SEA): up 31.8% year-to-date. Recovery in oil prices and Middle East production could translate into strong earnings for global shippers. Crude oil makes up aruond 1/6 of global trade.
• WisdomTree Middle East Dividend (GULF): up 8.4% year-to-date. GULF has a broad market Middle East and North Africa exposure. It has a wider selection of holdings than PMNA or MES, a lower expense ratio, and is dividend weighted rather than capitalization weighted. But the funds competition, GULF is a little low on volume.
• iShares Dow Jones U.S. Oil Equipment Index (IEZ): up 39.7% year-to-date. Major equipment and service companies included in this fund have business in the Middle East. IEZ has outperformed crude oil ETFs and indexes of major integrated oil companies year-to-date.

As always, watch the trend lines to see what actually materializes.

For more stories on the Middle East, visit our Middle East category.

For full disclosure, Tom Lydon’s clients own shares of MOO.

Max Chen contributed to this article.

This ETF was the Claymore/Robb Report Global Luxury (ROB).  The ETF focuses on companies that mainly generate revenues from the sale of highly luxurious items.  Some companies the ETF holds are Daimler (DAI), maker of Mercedes Benz, Coach (COH), Nordstrom (JWN) and Saks (SKS).

The ETF is a great idea, offering investors exposure to these high-end retailers and merchandisers while offering some diversity.  However, the timing of its release was unfortunate, states Selena Maranjian of the Motley Fool.  It launched a few months before the beginning of the global recession, which forced consumer consumption to dramatically decline and forced many to think twice about buying “the nicer” things in life.  This caused many of the luxury retailers to tread in deep water.

ROB was simply the victim of an overall bad market in 2008, and it was down 51.5% for the year – in line with the broader market. The ETF worked exactly as it should.

On the positive side, as the economy starts to recover, consumer confidence will build up and spending will increase.

If you do choose to grab exposure to luxury retailers, don’t just jump into the ocean.  As with all other investments, always have a strategy, stay diversified, do your homework and know exactly what is under the hood.

Kevin Grewal contributed to this article.