The top spenders in the market are showing their part of the economy is recovering. This is evidenced by the recent year-over-year increase in luxury goods spending as reported by American Express and Bain & Co.’s Luxury Goods Worldwide Market Survey.

Luxury goods, defined as non-durable items priced at $1,000 and up, such as apparel and accessories, saw a 15% increase in 2010 and is expected to have an additional 8% worldwide increase in 2011.

Three things seem to be fueling this material consumption. In the US, the stock market is up 100% over 2009 lows. It has been shown that 40% of the top 1% of all wage earners in the US has a substantial portion of their wealth in the stock market.

In Asia, the economies have been booming and minting newly made luxury buyers by the sheer numbers of the population. China is the fastest growing luxury market, with an expected 25% growth in 2011. It is still smaller in total dollar size than the U.S., but China is projected to be larger than Japan shortly.

Lastly, the real estate market in the United States seems to have double bottomed, as rents are firming up along with occupancy rates for wealthy landlords with higher real estate holdings.

Many luxury retailers are still feeling the lingering effects of the recession, as sales vary widely month-to-month, depending on their clients near term mixture of good and bad news in their personal financial situation. There has been a significant improvement in margins, as excess inventory has been cleared. Sell-through of current season merchandise, along with a lingering desire for sale shopping, continues to drag on profits as predicting future season best-sellers has become more art than science in recent seasons.