The global economic crisis that gained traction in 2008 affected many retail sectors, and the luxury goods business was on exception. Overall purchases of luxury goods fell in the key U.S. market; sales slowed in Russia and other emerging markets as well. Although total sales in the luxury segment were expected to reach a record $218 billion in 2008, industry observers expected the sales to drop significantly in 2009. For European-based luxury companies, there was some good news: the dollar was strengthening against the euro. As the 2008 holiday shopping season approached, many luxury goods markets reduced prices in the United States. At Chanel, the cuts ranged from 7 to 10 percent; as John Galantic, president of Chanel’s U.S. units, noted, “The dollar’s recent strength has allowed us to pass on greater value to our customers. “Louis Vuitton was a notable exception; in fact, during 2008, the company raised prices twice, resulting in an average increase of 10 percent. The price increases did not dampen sales; in fact, sale continued to increase.