Charles Grom's upgrade for Macy's Inc. Friday held a glimmer of hope for the New York City retailing scene as well.


The J.P. Morgan analyst switched his recommendation on the stock to "overweight" from "neutral" Friday and pinned part of the change on an improvement in Manhattan's shopping backdrop.

No good diversification strategy goes unpunished.

Finlay Enterprises Inc. put up a good fight, but that fight ended on Aug. 5 when it filed for bankruptcy and headed for liquidation -- even though it did what most of its competitors would have done under the same circumstances.

Cataclysmic financial swings overtook just about everybody last year and most businesses somehow muddled through. The real action -- the retail fallout -- might be just beginning.
But it's hard to guess what will happen when we're all recovering from whiplash.

Those Wal-Mart folks are a hearty bunch. If nothing else, "Mr. Sam," instilled in his employees an appreciation of the early-to-bed, early-to-rise adage and a serious work ethic, leading by his own 16-hour-day example. I was reminded of this when I attended the company's media day and annual shareholders meeting last week in Fayetteville, Ark.


The drive from Northwest Arkansas Airport to Bentonville is pleasant enough, passing green pastures dotted with horses, cows and charming ramshackle barns, a scene that is occasionally broken by gated McMansion communities, followed by more bucolic scenery.


I checked into my hotel on Wednesday evening, ordered a tostada chicken salad from the all-Mexican-food restaurant menu and watched "The Devil Wears Prada" (twice). Watching the machinations and ridiculous striving of aggressive New Yorkers made me feel more at home while in the hinterlands.

It was a letdown for both sides.

After two years of legal wrangling, days of testimony and thousands of pages of court documents, Trovata and Forever 21 are back at the starting line because of a mistrial over allegations the cheap-chic retailer knowingly copied Trovata's designs.

Fashion has such a giddy air of wealth and excess around it that it's difficult to fathom when seemingly high-riding designer companies falter.

I'll never forget the disbelief in the WWD newsroom in New York back in 1998 when the paper got word that Chanel Inc. was dissolving its partnership with Isaac Mizrahi and shuttering the business.

It was déjà vu when I walked into Christian Lacroix's headquarters on the Rue de Monceau in Paris on Wednesday to learn the company had filed a petition seeking court protection from its creditors. It's always disheartening to see a wildly creative designer -- at Lacroix, even the wires coming out of the receptionist's computer are festively decorated with wooden beads and glittering rings -- run up against a wall.

One of the most unsettling things about economic booms is the knowledge, bitterly reinforced in the past year, that one day the bubble is going to burst. Similarly, it's one of the few consolations in an economic decline that it, too, will end one day and that recovery will at some point become unstoppable and undeniable.

WWD recently asked a lot of very smart people when the recovery would begin and what would precipitate it. Not surprisingly, few were able to predict the "when" and "what" with much certainty or commitment, and a few even had the candor to admit they had no idea. One source, who politely opted out when asked for an on-the-record comment, said, "The patient will get better when he stops being so sick."

It's show-and-tell time for executive paychecks.

And with profits and shareholder value falling in the recession, those pay stubs are coming under intense scrutiny.

Darwin's theory of evolution, which argues that only the fittest survive in a given environment, seems to have newfound currency in today's grisly marketplace.


"It's like judgment day for us. There are just too many stores out there for all of us to survive this," Rick Weinstein of Searle told WWD in December. "The best will survive."


A director at a textile company echoed Darwin's ideas of natural selection in another WWD story that ran in February. "We have to endure," said Kohji Yamanaka, director of the textile department at Mitsubishi Rayon Textile Co. "Such circumstances [force] textile manufacturers to exert themselves to survive. It might be tough, but it will be worth it."

Occasionally, during last week's annual Personal Care Products Council meeting in Boca Raton, Fla., there was some grumbling about the need to change the organization's name -- again. It had been changed 18 months ago from the decades-old Cosmetic, Toiletry and Fragrance Association in order to make the group seem more consumer friendly.


Well, if any cosmetics executives are serious about finding a more relevant moniker, maybe they could choose Editor & Publisher, judging from the media turnout at the meeting. Even though attendance had withered (from 650 last year to 400) with cosmetics manufacturers threatening to go the way of the Last of the Mohicans, the magazine contingent was there in depth, as usual. Of the 356 attendees listed in the program, 120 of them were from the media, mostly from women's fashion and lifestyle magazines, with assorted trade publications and even electronic media thrown in. (Indeed the organizers of PCPC invited two WWD editors to participate in a panel discussion, including me.)