At the beginning of every downturn, it seems that some analyst claims there is a haven for luxury retailers, still, especially the classic retreats of the very, very rich -- like Tiffany & Co (NYSE: TIF). And then: reality. In this current era, "reality" equals the collapse of many of America's most storied financial institutions; the companies whose deal gifts and corporate tokens were, more often than not, wrapped in Tiffany's iconic blue ribbon.

With far fewer investment banks to hold Christmas parties and bonuses not rolling as they typically do, shoppers, it seems, avoided pricey baubles as gifts. Holiday sales were down 21%, Tiffany reported today, and it lowered its forecast for the fiscal year's earnings, down to a range of $2.25 to $2.30 per share. Its fourth quarter ends on January 31, and Tiffany CEO Michael Kowalski expects the depressed luxury retail environment to continue well into fiscal 2009.

This comes following a late November prediction that 2008 EPS would come in as much as 28 cents below analyst's estimates, between $2.30 and $2.50 a share.

Tiffany's stock sank as much as $2.00 per share on the news during the day, but by market close, had rebounded to only a few cents' decline, down 0.23% to $21.95. This may be a buying opportunity, however; after having recorded a five-year low of $16.75 in November, the stock has been climbing slowly up from its nadir. Will luxury look to have its heyday again? Perhaps.