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APRIL 6/APRIL 13, 2009

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TheCasefor SmartLuxury

ln hard times the savvy are fleeing ta quality, ta unknawn labels, small- name artists, dawnsized mansions and simple fine cuisine. Special report. Page40

Special Report: Luxury 40 Trading up: Spend more on

less byJonathan Tepperman 44 Fashion: Unknownlabels

are thriving by Sameer Reddy 48 Food: No-frills fine dining

by Ginanne Brownell 56 Home: Downsized mansions

by CathleenMcGuigan 62 Crisis will cleanse luxury

of the crass byNick Foulkes THE ISSUE

World Affairs

20 Krugman: The populist's idea man by Evan Thomas 26 Geithner: Nowthe bailout

king by Michael Hirsh 29 Big bonuses don't create

bubbles by Peter Tasker 30 Japan: The opposition

caTIwin by David McNeill

32 Q&A:Joseph Stiglitz on why

.

China is attacking the dollar 33 The charmless new face of

Labour by William Underhill 34 How the Obama team reads Russia byAndrew Nagorski 35 The last chance for Thrkish

reform by OwenMatthews 36 The party of Saddam is

back byLarry Kaplow

DEPARTMENTS 4 Periscope 5 PersPectives 19 WorldView 11 The GoodLire 80 The Last Ward

STRONGMAN: Pundit Paul Krugman wields a poison pen

COVER:PHOTOGRAPH

BY STEPHEN LEWlS-ART+COMMERCE

Vol. GUll, No.14/15.April6/Aprll13, 2009@ 2009 by NEWSWEEK,Inc., 251

West

57th Street, New York, NY10019.Prlnted by Roto Smeets, Weert, Netherlands. Ali rights res,rved. Registered at the Post Office as a newspaper. Gopy- right under the International Gopyrlght Gonvention.Gopyright reserved under the PanAmerican Gonvention.Registered in the PhilippinesPatent Office. ln the U.S.A.:

Postmaster:

send address changes to NEWSWEEKINTERNATION- Al, 251West 57th Street, NewYork, NY10019;periodical postage paid at New York, N.Y.,and at add~ional mailing offices. NEWSWEEKINTERNATIONALis wr~ten and ed~ed for a worldwide audience and is published weekly, except occa- sionally two issues are combinedinto one expanded issuewhich counts as two subscription copies, in the U.K.by NEWSWEEK,Inc. (ISSN 0163-7053). Toorder reprints (minimum order required: 500 copies) or request permission to republish a NEWSWEEKarticle please cali 1-212-445-4870or fax 1-212-445-5764. Oir. Resp.Italia Marco Provasi; rappr. IMOsri, via G. da Velate11-20162Mllano; autoTrib. MI N. 453 dei 12/06/87 sped. Abb. Post. 45% art. 2 comma 20/b Legge23/12/96 n. 662 Mllano; Repr.pour la France: E.M.O.France S. A., B.P.1029-59011 Lille Gedex-Tel 03.20.30.03.02.Le Oirecteur de la Publication: Alan F.Bone-G.P.P.A.P.No. 0708G83393. Ge numéro comprend un en- cart de deux pages (abonnement) sllué entre les folios 2 et 55. Editeur responsable pour la Belgique:André Verwllghen,AvenueLouise 176,1050 Bruxelles

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