www.nytimes.com/2008/06/01/fashion/01rich.html
CHRISTINE HAUGHNEY Published: June 1, 2008 NANCY CHEMTOB, a divorce lawyer in Manhattan, has found that her days have become crammed seeing clients, all worried about how an economic downturn will affect their marriages.
Enlarge This Image Lou Beach Plane, Ann Johansson for The New York Times; Hair, Image Source, via Corbis CUTTING CORNERS Sometimes, sacrifices have to be made. They seem to have nothing to fret about: their net worths range from $5 million to $1 billion. A blip in the markets shouldn't send their chateau-size Park Avenue co-ops to foreclosure or exile them to Payless Shoes. But Ms Chemtob's clients are concerned all the same, she said, because their incomes have shrunk, say, to $2 million a year from $8 million, and they know that their 2008 bonus checks are likely to be much less impressive. One of her clients recently confessed that his net worth had decreased to $8 million from more than $20 million, and he thinks that his wife will leave him. He has hidden their fall in fortune by taking on debt to pay for her extravagant clothes and vacations. "I literally had to sit there and tell him that he had to tell his wife that she had to stop spending," she said. "He was actually scared she would leave him because their financial situation changed so drastically." The wealthy don't generally speak publicly about their finances, in good times or bad. It's in poor taste, for one, and their employers could fire them for talking even a little. But people who provide services to the wealthy -- lawyers, art advisers, personal trainers and hairstylists -- say they are getting an earful about their clients' financial anxieties. Interviews with the people who actually see the bank statements, like divorce lawyers and lenders, say their clients are definitely living on less than they did a year ago, regardless of how expansive the definition of "less" may be. Hairstylists and private jet rental companies say the wealthy are cutting back on luxuries like $350 highlights and $10,000-an-hour jet rentals. Even nutritionists and personal trainers notice a problem. The wealthy are eating more and gaining weight because of the stress. These financial problems -- if they can be called that -- will hardly elicit tears from the rest of us. But in those gilded living rooms, there is a quiet nervousness about keeping up appearances. "Even if they're not in danger of not paying their mortgage, there's still a psychological change," said Chris Del Gatto, chief executive of Circa, which has watched its business jump by 50 percent in the last year as wealthy clients sell their spare diamonds and Rolexes. "The economy is an issue even for people who don't need the money." THEIR spouses could leave them when they discover that their net worth has collapsed to eight figures from nine. Friends and business associates could avoid them as they pass their lunchtime tables at Barney's or the Four Seasons. "They fear their kids won't get invited to the right birthday parties," said Michele Kleier, an Upper East Side-based real estate broker. "If they have to give up things that are invisible, they're OK as long as they don't have give up things visible to the outside world." So New York's very wealthy are addressing their distress in discreet and often awkward ways. They try to move their $165 sessions with personal trainers to a time slot that they know is already taken. They agree to tour multimillion-dollar apartments and then say the spaces don't match their specifications. They apply for a line of credit before art auctions, supposedly to buy a painting or a sculpture, but use that borrowed money to pay other debts. "Most people won't go to their banker and say: You know I'm in desperate trouble. I need funds,' " said Andy Augenblick, president of Emigrant Bank Fine Art Finance, which allows clients to borrow against art collections worth more than $2 million. Mr Augenblick said that the number of requests for these types of loans is five times higher than a year ago. He said that while these borrowers claim that they don't need the money, their latest financial statements show that their net worth has withered in the past year.
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