The Gen Z devil wears Prada

This is Bloomberg Opinion Today, a catwalk sashay through Bloomberg Opinion’s opinions. Sign up here. The cool kids are rediscovering an add [Bloomberg]( Follow Us [Get the newsletter]( This is Bloomberg Opinion Today, a catwalk sashay through Bloomberg Opinion’s opinions. [Sign up here](. Today’s Agenda - The cool kids are rediscovering an addiction to [Prada](. - The Fed is [addicted to buzzwords](. - The Bank of England is [closer to shaking off its rate-hiking addiction](. - Europe is [kicking its addiction to Russian molecules](. Back to the ‘90s The 2006 film The Devil Wears Prada featured more than [$1 million of clothing](, most of it borrowed and much of it crafted by the Italian fashion house that featured in the title. In recent years, though, Prada SpA has been eclipsed by Kering SA’s Gucci. But Prada is [roaring back into fashion](. “The Italian luxury group seems to finally be turning its fortunes around, thanks in part to its popularity with Gen Z,” write Andrea Felsted and Rachel Sanderson. For the five years through 2018, Prada posted declining annual sales, hurt by China’s crackdown on conspicuous consumption and by its slow response to shoppers shifting their buying to the internet. The current enthusiasm for all things ‘90s, when the fashion house was riding high, has helped it bounce back, as has belated investment in the company’s digital capabilities. But profitability remains an issue. A profit margin of 17.4% in the first half of this year is half of what Gucci generates, and far behind the 42% enjoyed by Hermes. Prada remains overly focused on fashion and shoes, versus higher-earning handbags that can deliver margins of as much as 80%. “Coming up with more It bags, and bringing them closer to the price of Chanel and Hermes, could help Prada meet its ambitions even amid a slowdown,” write Andrea and Rachel. “It’s the super-wealthy who are continuing to spend after all.” The Fed Has a New Catchphrase (But Good Luck Working Out What It Means) The picture above, courtesy of Jessica Karl, illustrates the development of the Federal Reserve’s recent narrative in the face of runaway inflation, and highlights its latest attempt at obfuscating its policy intentions by torturing the English language into [impenetrable semantic knots](. The phrase “sufficiently restrictive” appeared freshly minted in paragraph three of the US central bank’s latest policy statement, which accompanied Wednesday’s 75 basis-point hike in interest rates to 4%. “If you can decipher the meaning of this phrase, you may just be able to figure out what the Fed’s rate-setting committee will do in coming months,” writes Jonathan Levin. “But don’t get too excited, because you probably can’t.” Ostensibly, a sufficiently restrictive policy would be one that puts inflation back toward the Fed’s 2% target, down from September’s 8.2% level. But apart from telling us that neither neutral nor accommodative stances are deemed appropriate, the phrase is little guide to where borrowing costs are headed. “It exists to provide something that looks and feels like specific guidance, but is vague enough not to tie policymakers to a specific reaction function,” Jonathan writes. Across the pond at the Bank of England, meanwhile, Governor Andrew Bailey also oversaw a rate increase of three-quarters of a point on Thursday, but spent most of the accompanying press conference trying to convince traders that they’ve overestimated how high the peak will be for borrowing costs. With the UK facing a recession that the central bank reckons will last for two whole years, [the slowdown in growth](will do much of the work of curbing inflation, reckons John Authers. The recent market meltdown, sparked by Liz Truss’s plans to introduce billions of pounds of unfunded tax cuts, may paradoxically have made the BOE’s life easier, John argues. “While a month ago the BOE had to warn that looser fiscal policy would require tighter money, the upshot of the crisis has been to give the new prime minister, Rishi Sunak, an incentive to shift all the way to tightening fiscal policy. If the market won’t abide fiscal expansion, this might be his best bet to get through the next two years.” Bonus Blighty Reading: Rishi Sunak needs to reset [Britain’s approach to Europe](. — Bloomberg’s editorial board Telltale Charts European natural gas prices are falling as storage tanks fill up for the winter. “Getting through winter without relying on Vladimir Putin’s gas is looking achievable,” argues Lionel Laurent. “But [confidence mustn’t turn into complacency](.” Further Reading Denouncing [the attack on the Pelosis]( isn’t enough. — Michael R. Bloomberg The [US crime wave is real](, especially in big cities. — Justin Fox Elon Musk sabotages [his defense of free speech](. — Robert A. George [Being single]( is becoming more expensive than ever. — Erin Lowry [Leftist Lula will be a centrist]( with regards to the military. — James Stavridis [Iran’s brutal crackdown]( creates an opening for Biden. — Bobby Ghosh Olaf Scholz won’t be the last Western leader to [visit Beijing](. — Pankaj Mishra Pakistan will take [years to recover]( from the shooting of Imran Khan. — Mihir Sharma If the world wants lithium, [let China finance it](. — Liam Denning ICYMI The metals for your electric vehicle are [stuck in a 30-mile traffic jam](. In Africa. In a message directed at Putin, Xi tells Scholz that [China opposes the use of nuclear force](. Adidas dropped Ye, but [sneakerheads are driving up prices]( of his Yeezy sneakers. China is said to be preparing a plan to [end Covid flight suspensions](. Kickers The Pope could help reduce global carbon emissions with a papal decree to reinstate [meat-free Fridays for Catholics](. A man [pretended to be Stanford student]( and lived in university dorms for almost a year. Billionaire hedge fund manager Chris Rokos is hiring an iPad butler a [“VIP support engineer](” for his “wide estate” of gadgets. Applicants will need a “comprehensive understanding of Apple media products and features e.g. Apple TV, HomePod, iPad, iPhone, Family Sharing, iTunes, Photos.” For the horse in your life: [Nike horseshoe sneakers](. A snip at $1,200 each. (h/t Andrea Felsted) Notes:  Please send equine leisurewear and feedback to Mark Gilbert at magilbert@bloomberg.net. [Sign up here]( and follow us on [Instagram](, [TikTok](, [Twitter]( and [Facebook](. Like getting this newsletter? 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