Now, Monte Carlo is synonymous with glitz, glamour, and big money. It was no coincidence that chiefs from the world’s luxury goods sector gathered in the city state this week. We sent our reporter Ryan Chilcote along as well. He would examine how companies from Burberry to Jimmy Choo are faring as the recession hits even the super rich. Monte Carlo is one, if not the place the world’s rich come to sun and be seen. This week though, Monaco has also been host to the world’s biggest luxury makers. Unlike previous downturns that missed the super wealthy, this one has been sobering for the luxury market. While business is not as ugly as it was just a few months ago, no one is exactly happy where things stand. The market trend is pretty challenging. I would say down 15 percent, as a relative position of strength is very cold comfort. 'Down 15 percent' stinks. cold comfort -- if something that is slightly positive is cold comfort to someone who is feeling very bad about a situation, it does not make them feel any better. We have begun in certain markets to see the business stabilize. It’s not getting any worse. I’m not going to tell you in some of those markets - like Spain or America by now - that it’s getting any better. Europe’s capital of luxury mirrors what’s happening in the broader market. Demand for property in the principality, some of the most expensive in the world, is down about 35 percent. Many say that’s because the wealthy got a little too carried away in the last boom. They argue it’s time for both the city state and luxury makers to get back to their roots: making the very best, making it very exclusive. No…store in each corner of the city, no store with hundred-thousand piece of fabric inside with the logo…and no soap or perfume, shampoo with an incredible, charming name? No sense at all. Luxury makers would love to get people to spend even more money on fashion than they do in Monaco…but the reality is the real focus isn’t here at all. The reason why their sales aren’t any worse than they are, and their great big hope, is that way. -I think China is the real market for us.-You’ve got this balance across the different geographies. You’ve got markets like Hong Kong that have held their own, and markets like China that have not really felt the declines. Night falls in Monte Carlo, and the lights haven’t exactly gone out. But they certainly aren’t burning as brightly as they were. It may just take Monaco, and the luxury market as a whole, some time to get its luster back. Ryan Chilcote, Bloomberg News, Monte Carlo. Ryan Chilcote will continue hanging out with the rich and famous in Monte Carlo. Our coverage from Monte Carlo continues tomorrow with a look at how the recession has hit the hedge fund industry. You don’t want to miss that.