And it isn’t only Michelle Obama who has designers hopeful. The newly minted vice president’s wife, Jill Biden, also can hold her own in the fashion department. Biden, who modeled on the side in college for extra cash, has a keen sense for what complements her physique. She is known to support independently owned Wilmington, Del.-area boutiques, with Tory Burch, Milly, Diane von Furstenberg, Nanette Lepore and Robert Rodriguez being among her favorite labels. Biden isn’t above borrowing if need be. Ellie’s owner Donna Schneiber loaned Biden a few Sayami scarves from her own closet for the inaugural weekend, since the Greenville store had already sold out of that resource.

At the swearing-in ceremony, Biden went with an off-the-rack $360 Milly houndstooth roll-neck dress with a Fleurette coat. Milly designer Michelle Smith said, “As an American designer with a tradition of manufacturing my collection in the U.S., I was humbled to see my dress on such a chic and sophisticated Second Lady.”

Biden also didn’t cut any corners for the inaugural balls, buying a red strapless Reem Acra dress from a store—not the designer.

So with a young, fashionable First Couple and a chic vice president’s wife, the new administration—which also includes such fashion-conscious members as social secretary Desirée Rogers and White House adviser Valerie Jarrett—has the fashion industry eager to become involved with Washington politicians in a way it hasn’t in decades. The nation’s capital, once scorned by the fashion set, is now embraced by it with open arms.

“To have a First Lady who loves fashion, and who is promoting American designers, is so important and we need that so much, with the way the economy has impacted fashion, and everybody trying to make their way through it,” said Rodriguez.

“What is admirable about her is that she makes her choices and they are her personal choices. It’s fantastic to see and to discover who she is through her choices,” he added. “For us, to have someone like her who is bold in her choices, it’s an inspiration.”

And that is the way most observers, both the millions present and those watching worldwide, felt on Tuesday. Milan hotels set up TVs in their lobbies so guests there for the men’s shows could watch the inauguration live, and there also were numerous viewing areas set up in London — from restaurants and hotels to pubs. People wanted to observe the inauguration of the nation’s first African-American President, who admitted to the immense challenges ahead.

“Our nation is at war, against a far-reaching network of violence and hatred,” Obama said to more than 1 million people who braved the frigid temperatures for hours on the Mall. “Our nation is weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age. Homes have been lost, jobs shed, businesses shuttered.”

Obama said the challenges the country faces are many, but “they will be met.”

“The state of the economy calls for action, bold and swift, and we will act—not only to create jobs, but to lay a new foundation for growth,” Obama said. “We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together.”

Obama also addressed political turmoil abroad, indicating that he will seek peace in a time when the U.S. is at war in Iraq and Afghanistan.

“To those who cling to power through corruption and deceit and the silencing of dissent, know that you are on the wrong side of history,” he said. “But that we will extend a hand if you are willing to unclench your fist.”

New York Mayor Michael Bloomberg said in an interview that Obama is “going to have some very tough times.”

“He’s not going to wave a magic wand and fix all of our problems, but he can provide the confidence that the public needs to have and get the public to make investments and buy houses, and run risks and that’s what you need,” Bloomberg said.

He noted that even businesses of famous Seventh Avenue designers such as Oscar de la Renta, Vera Wang and Carolina Herrera are “slowing down,” but he was optimistic that companies will adjust and Obama will restore confidence among consumers.

“In this case, you’ve had eight years of one president so there’s plenty of time to say ‘OK, now’s the time for something different,’ and we’ll probably think that eight years from now but change is always good,” said Bloomberg, who is seeking his third term in office.