Q: What’s a high end style section to do when fashionistas forsake their Choos for sensible affordable flats, when frivolity turns frugal and fur goes fake?

A: Insert copy about key ‘investment’ pieces; discuss muted, sensible colour pallets — and revive the fabled lipstick index.

As the New York Times’ style section recently put it:

As the economy crumbles, the Lipstick Index — that frivolous financial barometer that says cosmetics sales rise in direct relation to free-falling finances — has jumped. Sales in the last few months are up 40 percent. Here are 41 of fall’s most popular pick-me-ups, from $1.99 to over $50. What do women want when they aren’t allowed to want too much? Traditional lipsticks in more-sheer neutral shades; the bright reds of days gone by have been replaced by pinky browns and rosy taupes.

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So as we wait for concrete indicators that Australia’s wider economy has fallen victim to Wall Street’s folly, lipstick it seems is as good an indicator as growth projections from the Federal Government.

Crikey headed to the most dreaded of shopping expeditions, the cosmetic department in search of perfumed answers.

At “Kit” stores in Melbourne it seems the lipstick boom has yet to hit with reports that the only increase in interest coming from Poppy King’s new line.

At Australis sales have gone up slightly in correlation with new lines hitting the stores in the past few months and at Clinique Northland store manager Philomena reports “Lipstick sales are up for the reason that they come in so many lovely colours.” Perhaps we needed to look a little further up the ranks in the lippy business to get some concrete indicators.

Estee Lauder Chairman Leonard Lauder was the first to herald the phenomenon of the lipstick index. According to Lauder, after the economic slump caused by the terrorist attacks in 2001, lipstick sales had improved, pointing to an ongoing reciprocal relationship between economic downturns and lippy.

But maybe, just maybe, the renewal of Lauder’s 2001 assertion in the New York Times was a cunning marketing ploy to boost cosmetic sales.

A google search of “the lipstick effect” suggests Lauder’s comments are the sole basis for this argument.

A further search of Estee Lauder’s annual reports found that contradicting Leonard Lauders 2001 comments was an assertion by CEO William Lauder in 2006 that Estee Lauder sales were hit by recent terrorist attacks: “Fiscal 2006 was a year in which we were tested. We weathered unprecedented challenges from retailer consolidations, natural disasters, and a more demanding marketplace.”

When we called PR manager for Estee Lauder Australia Alice Hocking for a comment on this marketing conspiracy, she suggested that the figures were not concrete enough for Estee Lauder to stand by the assertion officially, but they were looking into the matter.