It's a wonderful Christmas in Beverly Hills.

Rebounding economy, confidence fuel holiday spending spree 

Some might contend that life's always sweet on Rodeo Drive. But it's especially sweet this holiday shopping season.

Overall retail sales across Southern California are up 4 percent to 5 percent over 1995 levels, and anecdotal evidence is that much of that increase is due to strong sales of luxury goods.

Ultra-swank Beverly Hills jewelry store Van Cleef & Arpels, which has been bustling since the holiday shopping season began after Thanksgiving, has seen the biggest growth in sales of its $200,000-and-up baubles, according to executive vice president and manger Ron Viejo.

"There are times when people feel beaten, and L.A. was that way in the past, but I think the city's been on an upswing for almost a year now," Viejo explained.

Two weeks ago, a customer bought a piece of jewelry from the store for more than $1 million, Viejo said. "People are feeling good about the economy."

Up the block at Galerie Michael - home, they'll have you know, to the largest collection of Rembrandt etchings in the United States - three customers are competing for the right to buy a $950,000 painting.

"Normally we wouldn't have such a large number of people looking" at such a big-ticket item, said the gallery's art consultant Mark Miles. But now, "It's more (difficult) finding the items than selling them."

Across the street at Fred Hayman, where men's sweaters sell for $750 and blazers top $2,000, manager Michael Stachowski can't keep $2,500-to-$5,000 alligator skin handbags in stock.

"We're much busier this year than last," Stachowski sighed. "I don't know how we're going to ship all this merchandise."

Anecdotal evidence and recent retail surveys suggest luxury items are among the year's hottest sellers. Jewelry sales, for example, are up 28 percent over 1995, according to the International Council of Shopping Centers.

And people are spending more on loved ones, American Express reports. This year, 41 percent of shoppers said they plan to splurge on a spouse or child, compared to 34 percent in 1995.

The amount they will spend on such indulgence buying is expected to be up 21 percent from last year, to an average of $500 per gift-recipient, according to the American Express study.

"There's no doubt higher-ticket items are moving at a faster pace," than in years past, said Jackie Fernandez, director of the retail services group at Deloitte & Touche. "All the retailers over on Rodeo Drive are doing pretty well."

So what's driving the buying frenzy?

"Confidence. We've had record years (in the stock market) the last three years in a row, and people feel like, 'Hey, it's a good time to splurge,'" said Ron Richards, vice president for corporate finance at the investment bank of Van Kasper & Co. in Westwood.

Richards said a record number of initial public offerings and recent profit taking on the stock market have also pumped a large amount of money into circulation.

"People like to reward themselves for accomplishments," Van Cleef's Viejo observed. In particular, he said, the under-40 crowd has been particularly acquisitive. "Young people doing well have no problem (spending large sums on luxury goods.)"

Increased consumer confidence and spending has been seen among middle-class shoppers, as well. Nationally, December shopping mali sales were up 21 percent as of last week, compared to the like period a year ago, according to a survey by the International Council of Shopping Centers.

"L.A.'s doing pretty well, whether in the Valley or Burbank or even in Orange County," said Douglas Christopher, an analyst at Crowell, Weedon & Co. securities brokerage, who follows the local retail industry.

According to a survey by American Express, L.A. shoppers, like those across the country, will spend an average of $1,160 each this season, with $900 going toward gifts, and the remainder on holiday entertaining, decorations and travel.