South Florida Sun Sentinel from Fort Lauderdale, Florida • 49

SB FRIDAY, DECEMBER 17, 2010 SUNSENTINEL.COM SUN SENTINEL 3D SERIES TO Am ON STARZ SHOPPING IIAEITS TV SHOW 'MAGIC CITY' IS SET IN MIAMI BEACH Middle-class sours on splurges, luxury retailers face new reality I 5 Hti, AL DIAZMIAMI HERALD Mitch Glazer, producer of "Magic City," said the TV show will revolve around a hotel inspired by the architecture of Morris Lapidus who designed the Fontainebleau, above. On this last weekend before Christmas, there is one shopper who will be noticeably absent from Gucci, Neiman Marcus or Cartier. The "aspirational shopper" died along with our home-equity lines of credit To say that these middle-class shoppers who splurged on status-symbol handbags, suits and shoes were important to the luxury segment is like saying property values were a little inflated. "The aspirational consumer represented more than 50 percent of all the growth in the i luxury segment," said Marshal Cohen, chief industry analyst at The NPD Group. "That's the consumer that when the recession hit disappeared on luxury instantly." It's been three years since the aspirational shopper those with a household income of $75,000 to $150,000 evaporated from the marketplace.

Are they gone forever? It certainly appears that way The depth and length of the recession have so altered consumers' mindsets that bargain-hunting is the new cool. Luxury market researcher Pam Danziger takes it a step further. She says aspirational consumers don't exist. Instead, she says, high-end brands ought to be going after a shopper she likes to call HENRY. That is High-Earners- In a third-quarter survey, Danziger asked women in this category what clothing stores they most frequented.

Banana Republic, Ann Taylor and Ann Taylor Loft came out on top. "Everybody thinks these people only shop at Nordstrom or Nciman's and Saks," she said. "The reality is they aren't" And people who consider themselves HENRYs aren't yet ready to open their wallets. Spending in this segment has increased about 33 percent since the first quarter of 2009, but that only amounts to about $4,000 per person. People in this upper middle class seem to be shopping more than ever with coupons and looking for deals.

We're already seeing some brands making a play to lure more shoppers back. Lanvin, one of the most exclusive fashion houses in France, unveiled a limited-edition line just last month at the trendy midpriced retailer. The line includes dresses in the $300 range for women and suits for men. And last year Coach launched a lower-priced line of handbags called Poppy geared toward a younger consumer. That is how the star-shaped Swarovski crystals will realign for the luxury market.

Beth Kassab can be reached at bkassab orlandosentinel.com or 407-420-5448. By Hannah Sampson THE MIAMI HERALD Atlantic City has HBO's Prohibition-era "Boardwalk Empire." 1960's Manhattan has "Mad Men" on AMC. Now Miami Beach will have its own starring role in a period drama. "Magic City," a series set in a fictional Miami Beach hotel in the late 1950s, when the Rat Pack played and Fidel Castro took power in Cuba got the green light recently for 10 episodes from Starz Entertainment Casting is scheduled to start soon, and production will begin in 201L though it's still unclear how much, if any, of the series will be filmed in Miami. The show is set to air on the Starz cable channel in 2012.

Writer and producer Mitch Glazer is intimately familiar with the subject matter. Growing up in Miami Beach in the 1950s and '60s. Glazer, a 1970 Miami Beach High graduate, said he remains obsessed with the era. "So much that ended up shaping America politics, pop culture, everything from civil rights to geopolitical situations came through the lobby of those hotels," he said. Glazer said the show's hotel is inspired by the architecture of Morris Lapi-dus, who designed the Eden Roc and Fontainebleau.

He said he would love to shoot the entire series in Miami, but Starz said it is in talks with several locations, including some outside the state. Producers have applied for and received confirmation that they would get state incentive money to Not-Rich-Yet, a term first coined a few years ago by Fortune magazine. This is a group with an average household income of about $170,000 and money to spend. Newly zinged by the recession, these consumers no longer act like the wannabe-wealthy by snapping up designer jeans or shoes. Today they feel and act more like a traditional middle "There are 10 HENRY households for every one ultra-affluent household," said Danziger, president of luxury research firm Unity Marketing.

"Really the mark of opportunity is how you can get the HENRYs back. These people were living large before the recession. They were living on their perceived wealth." Luxury has made a bit of a comeback, steadying itself by focusing on its core shopper: the top 2 percent of consumers who can and will pay for exclusive brands. By at least one estimate, spending by so-called ultra-affluents or people with a household income greater than $250,000 has shot up by 53 percent during the past two years. But even they are shopping "smarter," Danziger says.

shoot the series in Florida, according to Miami-Dade film offices. Tallahassee recently increased production subsidies from about $11 million a year to about $50 million a year to draw more business to the state. News of the "Magic City" order follows word just weeks ago that ABC wants to revive the "Charlie's Angels" series, with a pilot to be filmed in Miami next year. USA's drama "Burn Notice" will shoot its fifth season in the spring in Miami-Dade, and crime series "The Glades" is expected to shoot its second season in Miami-Dade and Broward next year. Jeff Peel, head of the Miami-Dade office of film and entertainment, said having even two scripted series shooting in the region was a big deal.

"If we have four, man, this town is going to be hopping," he said. If "Magic City" shoots in some other city, it wouldn't be a first for a show set in Miami, but not filmed there: "CSI: Miami" and "Dexter" both are filmed in Los Angeles. But Graham Winick, head of the Miami Beach film office, said negotiations about "Magic City" have been positive for South Florida. The beach was enjoying headier times during the era when the show is set, said historian Paul George. "It's one of the heydays of the beach, with the Fontainebleau and the Eden Roc," George said.

"It was just on the world's map at that time." But as Frank Sinatra crooned and the wealthy gathered at the region's finest hotels, a darker side of Miami Beach existed under the glossy surface. The show will touch on drugs, strippers, gangsters, racial tension and global unrest as seen through the prism of the Miramar Hotel and its boss, Ike Evans. "My fantasy is of it being like Rick's Cafe in "Casablanca," where all roads lead to and through the Miramar," Glazer said. Business briefing 4 arrested in probe involving iPad leaks IT" -t 1 XjlM THIERRY ROGEREUTERS PHOTO Leaders meeting Thursday Included Spain's Jose Luis Rodriguez Zapatero, from left, Sweden's Fredrik Rein-feldt Italy's Silvio Berlusconi and Ireland's Brian Cowen. Europe bank arms for crisis Factories add spark to economy The U.S.

economy appeared to be gaining traction, with data on Thursday showing new claims for jobless aid fell last week and factory activity in the Mid-Atlantic region grew at its quickest pace in more than 5 years. The reports added to growing evidence of a substantial pickup in economic growth. "The recovery is gaining some momentum. Manufacturing output is strong, layoffs are slowing and we think GDP growth will be somewhere between 3 and 4 percent in the fourth quarter," said Mark Vitner, a senior economist at Wells Fargo Securities in Charlotte, N.C. Initial claims for state unemployment benefits fell 3,000 to 420,000, the Labor Department said, in line with forecasts and a recent downward trend.

In a separate report, the Philadelphia Federal Reserve Bank said its business activity index rose to its highest level since April 2005, indicating expansion in the region's manufacturing output. In another report, the Commerce Department said housing starts rose 3.9 percent in November. However, permits for future home construction dropped to a DS-year low. "The housing sector does not appear to be participating in the recent improvement in economic activity," said Paul Dales, a U.S. economist at Capital Economics in to the rolling crisis, said he worries about slow growth and the threat of contagion in Europe.

"I'm worried and that's why I'm urging the Europeans to provide for a comprehensive solution, because this piecemeal approach obviously doesn't work," he said. "And the markets are just waiting for what's next." EU leaders approved a two-sentence amendment to the EU's governing treaty at Germany's behest to permit the creation of a European Stability Mechanism to handle financial crises from 2013 on. The European Central Bank moved to increase its financial firepower to fight the euro zone debt crisis on Thursday, and European Union leaders agreed to change the EU treaty to create a permanent financial safety net. The ECB, in charge of monetary policy in the 16-nation euro area, said it would almost double its capital to $14.2 billion to cope with bigger credit risk and market volatility. Euro zone members will provide the increase.

IMF Managing Director Dominique Strauss-Kahn, a critic of EU leaders' disjointed response DAN KITWOODGETTY PHOTO "At Apple you can get fired for saying K48 outside of a meeting that doesn't have K48 people in it. That's how crazy they are about it." Walter Shimoon, accused of leaking Information about IPad, code named K48 By Grant McCool and Matthew Goldstein REUTERS Four people were arrested on charges of leaking secrets about technology companies to hedge funds, including details about Apple's iPad ahead of its launch, in a widening U.S. probe into insider trading. Authorities said another person, a former employee of Dell, had pleaded guilty Dec. 10 to charges he had provided inside information about the company.

The case is part of an insider-trading probe that intensified with a string of raids on hedge funds last month and subpoenas for information about their activities. The investigation comes as the Justice Department, which has failed to win any major convictions tied to the 2008 financial crisis, is trying to flex its muscles in prosecuting Wall Street crime. Those arrested included three technology company executives and a salesman for an "expert network" firm that hires industry consultants to advise fund managers about the tech sector. "Today's charges allege that a corrupt network of insiders at some of the world's leading technology companies served as so-called 'consultants' who sold out their employers by stealing and then peddling their valuable inside information," Manhattan U.S. Attorney Preet Bharara, whose office filed the case, said in a statement.

The probes into corporate corruption and insider trading will continue "over the next many months and beyond," he said. Those arrested Thursday include an executive who worked for Flextronics International, a Singapore-headquartered company that makes power adapters and other parts for Apple and other big tech companies. The tech company executives charged were Walter Shimoon, 39, of San Diego, who worked at Flextronics; Mark Anthony Longoria, 44, who was employed by chip-maker Advanced Micro Devices as a supply-chain manager in Round Rock, Texas; and Manosha Karunatilaka, 37, of Marlborough, who worked as an account manager for Taiwan Semiconductor Manufacturing. All were hired as consultants by California-based expert networking firm Primary Global Research. The firm said it no longer worked with the three and had placed the salesman who was charged, James Fleishman, 41, on leave.

Daniel DeVore, formerly a global supply manager for Dell, who worked as a consultant to the expert networking firm, pleaded guilty. Hedge funds pay networking firms to be Debit fees to drop in Fed plan US. banks and card networks would be forced to slash the fees they charge retailers under a Federal Reserve proposal released Thursday, sending credit card companies' shares tumbling. The proposal would generally limit debit "interchange" fees at 12 cents per transaction. The average interchange fee for all debit trans actions was 44 cents per transaction in 2009, the banking regulator said.

Banks charge retailers a fee every time a customer uses a debit card. The Fed acknowledged that the rule could impact debit card use, by leading issuers to eliminate rewards programs for debit cards or encourage consumers to use other forms of payment. linked with industry experts, who are supposed to offer insight on trends and how sectors work. Instead, the government said that in this case the experts were revealing information about sales and profits that gave certain investors an edge in trading. The government said it had intercepted phone calls in which Shimoon, a senior director of business development at Flextronics, leaked inside information about the release of the iPad and an updated version of the iPhone.

Referring to the iPad, whose code name was K48, Shimoon is quoted in court papers as saying: "At Apple you can get fired for saying K48 outside of you know, outside of a meeting that doesn't have K48 people in it That's how crazy they are about it." Flextronics said it had clear policies prohibiting the release of confidential information and that its employee charged in the case has been terminated. The court papers also said that Longoria, who worked for AMD, had told several Primary Global clients what AMD's second-quarter 2009 revenue and other financial data would be before they were officially released. MORTGAGE RATES 30-year and 15-year fixed rates Increase Freddie Mac said Thursday the average rate on a 30-year fixed mortgage rose to 4.83 percent from 4.61 percent in the previous week. The rate on the 15-year loan increased to 4.17 percent from 3.96 percent.