The Bleeding Eye council of elders decided that they were getting a bad reputation with the rest of the races and decided to do something about it. They consulted with a number of representatives of the other races (prior to chopping them up) and determined that they were simply too darn intimidating and that everyone was scared to talk with them. The end result is this cloak - meant to be worn by the Bleeding Eye diplomats when engaged in meetings, it is easily taken off when the time comes to be intimidating again.