AUSTIN, Texas -- The troubled economy cast a large shadow over the worldwide music industry gathered in the Texas capital for the 23rd annual South by Southwest Music & Media Conference, and the sense of foreboding was amplified by what many say is the imminent death of the CD and traditional record companies.

But if the old business model is terminal, the music is healthy as ever, with 1,900 artists from 40 countries performing during four nights of showcase gigs. And Chicago's indie-music-phobic city government should note that even in tough times, SXSW organizers and Austin officials say the fest generates $103 million for the local economy.

With dozens of local acts and thousands of Windy City music lovers attending the conference, Chicago is always well represented here. But this year, artists with local ties provided even more than their usual share of memorable moments.

The biggest name was the founder of G.O.O.D. Music, who appeared Saturday during a two-hour showcase for his label at a party sponsored by a clothing company and a music magazine. As he introduced himself: "Rockin' Southwest ... Kanye West!"

Dressed down in shades, a white T-shirt and a denim vest, the Louis Vuitton Don hosted a relentlessly high-energy hip-hop soiree that found him performing his own songs in between spotlighting his up-and-coming artists, including English soul singer Mr. Hudson and rappers Consequence (from Queens, N.Y.), Kid Cudi (Cleveland), Big Sean (Detroit), Tony Williams (West's cousin) and fellow Chicagoans Leonard "GLC" Harris and Really Doe.

Despite all that talent, West owned the stage with material from last year's "808s & Heartbreak." Recorded in a burst of cathartic energy after the death of his mother and the end of his engagement, the album is dark, brooding and introspective. But in Texas, with no hint of his infamous ego and or the sort of diva tantrum he threw at the Bonnaroo Fest last June, West turned songs such as "Heartless," "Love Lockdown" and "Amazing" into celebratory anthems.

Even "Pinocchio Story," a heart-wrenching freestyle on album, became an empowering mantra onstage. "I ask you tonight: What does it feel like to live a real life?" West asked. The joy in his delivery answered the question, and things got even more exciting when West was joined by neo-soul great Erykah Badu and Chicago hip-hop legend Common.

Performing on Friday night just hours after Billy Corgan announced that drummer Jimmy Chamberlin had quit the Smashing Pumpkins, their old band mate James Iha delivered an invigorating sugar rush with the debut of his new band Tinted Windows, a power-pop supergroup that also features Cheap Trick drummer Bun E. Carlos, Adam Schlesinger of Fountains of Wayne and singer Taylor Hanson of early '90s teen-pop phenoms Hanson. (The band performs at Double Door on April 30.)

And Thursday night saw a strong set by Chicago underground rock heroes Red Red Meat, celebrating the reissue of the 1995 album "Bunny Gets Paid." The band's slippery, otherworldly psychedelic blues always seemed ahead of its time before the group went on hiatus a decade ago, and Tim Rutili and his band mates showed that the music retains every bit of its hypnotic power.