Carolina Herrera Sees Signs of Life in Luxury

Fashion designer Carolina Herrera says she was "shocked" a few months ago when she noticed her $7,990 gray sequined tulle gowns were "selling like hotcakes," relatively speaking. During the downturn, she has had to walk a fine line, trying to cater to frugal consumers without damaging quality or image. But in December, she also opened an elaborate high-end boutique in Las Vegas that sells what she's known for: $3,000 cocktail frocks, $10,000-plus ball gowns and $1,800 skirts. Women who used to buy three dresses at a time and had cut down to one or none have started to spend again, she says.