By Catherine Field

Parisians have yet to start fishing for eels in the Seine to fill their empty stomachs. The euro remains solid, and has not been replaced by a barter system. Haute couture has no plans to make the potato-sack mini-dress the must-have garment for the looming recession.

Even so, a crisis mentality is now gripping France, along with other European countries, as the public comprehend that America's financial whirlwind is likely to hit them hard.

With headlines, TV and politicians dishing out daily doses of apocalypse, of likely job losses, budget constraints and falling property values, consumer spending has slumped.

In the gleaming boutiques on the Boulevard Haussmann, huge price cuts for clothing, reaching as high as 60 per cent for Armani, show how fashion-lovers are keeping a tighter grip on their purses.

"It's a sale, even though we're not allowed by law to call it as such. We're just bending the rules a bit," said an assistant at the Gap store near the Paris Opera where a dozen or so customers - mostly Asian tourists, apparently - trawled through the bargain racks.

Nearby, the mid-range restaurant Hippopotamus, which once trumpeted its juicy Charolais steaks, now pushes the once-despised hamburger. At ¬12 ($27) with all the trimmings, a "Hippo Burger" is five euros cheaper than a steak, a useful menu addition for the budget-conscious diner.

In the Rue Vivienne, adjacent to the palace that once housed the Paris stock exchange, shops that sell luxury shoes costing £300 ($855) or more have progressively cut their prices by nearly half. But they stand empty, the bored assistants leaning against walls.

In the same street are gold dealers, who are doing brisk business from investors looking for a safe haven. "There's no panic, no one's arriving with their savings, but lots of people buy two or three Napoleons, because they got burned on the stock market," said salesman Serge Siauvaud, referring to a 19th-century gold franc coin.

In another unusual sign of worry, sales of strong boxes have surged, according to the BHV department store in central Paris.

The reason: Wealthy individuals have closed their safe deposit boxes at banks, fearing that if the bank is suddenly closed down or forced into receivership, they may be unable to retrieve their valuables. Keeping jewels at home under lock and key seems to be a better bet.

In past years, supermarkets would by now have finished their autumnal special offers on wine and be geared for lavish food promotions for the All Saints Day holiday of November 1.

But this year, the focus is on price reductions, three-products-for-two offers and budget cuts of meat, rather than smoked salmon and foie gras.

Wines from Bordeaux and the Beaujolais are still on the shelves at discounts of 15 and even 20 per cent. And discount stores such as Netto and Lidl have never been busier.

For the general public, the mood seems to be one of austerity but not fear. Among businesses, though, sentiment is deeply tinged by concern about debt servicing and getting credit from banks.

"My company is finding it more and more difficult to borrow money in order to finance shows," Fabio Corsi, a 46-year-old entertainment producer, told Le Parisien. "Jobs are at risk ... I'm afraid of a mass panic."

After years of ever bubblier figures, Champagne sales have slumped by 4 per cent for the French market this year, and by a whopping 22 per cent in exports to the United States.

"Champagne drinkers need to feel good about themselves, and the economic climate is definitely less favourable now," Daniel Lorson, spokesman to the trade growers' federation, said.

The tourism industry had a bumper year until the financial storm struck in September. The number of high-spending Americans is falling, leaving the industry to turn to Chinese and Japanese visitors.