Front Page || Main Index || Corpus Christi News || Business || Texas || Sports || Entertainment || Selena
Thursday, Aug. 6, 1998
Small investors not panicking despite slide
By JOHN HENDREN
Associated PressIn Atlanta, Robert Brennan held onto the blue chips he'll start cashing in after he retires later this month. In Cedar Falls, Iowa, teacher Alma Bigelow left her retirement nest egg alone. And in Annapolis, Md., Navy retiree Billy Helm merely chuckled.
A day after Wall Street's professional money managers sold enough stock to crater 401(k) balances, amateur investors were ``kind of ho-humming it,'' A.G. Edwards & Sons market analyst Alfred E. Goldman said.
Though Wall Street shook, there was no panic on Main Street.
``It's going back up,'' said Brennan, taking a final vacation in Georgia before retiring from a Buffalo, N.Y.-area supply company. ``It has to.''
Like the 554-point Oct. 27 slide in the Dow industrials, Tuesday's 299-point drop was largely the work of a herd of professional investors who manage the accounts of pension and other funds, making big moves for short-term gains. Small-time investors with the long-term aim of saving for retirement mostly stood by for Tuesday's slide and the Dow's 59.47-point recovery to 8,546.78 Wednesday.
``I think that's an intelligent approach - just putting their money into their 401(k)'s and leaving it there,'' Goldman said.
That's what plenty of Charles Schwab investors apparently did, said Glenn Schaul, a Schwab broker in New York who had rolled up his sleeves to do some trading but, with no one waiting, had time to chat. Across the street at Citibank, there was no line for an investment counselor.
Schwab, the Vanguard Group of Valley Forge, Pa., the Janus Funds of Denver, and Putnam Investments in Boston all reported higher call volume but said most callers were simply checking the value of their stocks. T. Rowe Price brought in 12 extra phone representatives but sent them all home around noon because they weren't noticeably busier.
A few miles from the din of Wall Street, amid the old stone and new steel of Manhattan's Fifth Avenue, Dan Kennelly of Leonia, N.J., stepped out of a Schwab brokerage, where he checked the value of his investments but left his money where it was.
For Generation X-ers like 28-year-old Kristian DiGaetano, who has never seen a prolonged market drop, the jolting market was a mere curiosity.
``I just thought, oh damn, it went down, oh well,'' DiGaetano said from Baltimore. ``I know it's going to go back up. I have 30, 40 years to ride it out.''
Investors on the verge of retirement seemed most concerned.
Atlanta federal worker Lee Brooks, 54, is considering moving his money from stocks linked to the market-pacing Standard & Poor's 500 list to less volatile government bonds. Fellow Georgian Richard Hall, 63, may sell some of his riskier high-tech stocks.
``If I was going to start off and invest today, I wouldn't get in,'' said Annapolis retiree Helm, 58, who is nevertheless leaving his investments untouched. ``Most people don't make good decisions and they're just investing.''
Investors have to put their money somewhere, and in the age of the do-it-yourself retirement plan most individuals are now savvy enough not to move cash from mutual funds to mattresses, analysts say.
``There's only three places to put money: cash, bonds and stocks,'' said Greg Wolfe, an investment analyst at LaSalle St. Securities in Des Moines.
Not everyone was sanguine that their investments would return to steady growth.
New York accountant Ted Reisman is waiting to trade for another reason. He's waiting for a market ``correction'' to bring stocks to bargain basement prices before snapping up cheap shares.
``I intend to buy in about another month or so,'' Reisman said.
So does Wayne Hartnett. The 49-year-old financial adviser for the Delaware Department of Transportation moved about one-third of his personal investments out of growth stocks and into more secure bonds and cash funds. Now he's looking for deals.
``There're going to be some great buying opportunities out there.''Post your comments about local news eventsFront Page || Main Index || News || Business || Texas || South Texas Outdoors || Birdwatching || Sports || Entertainment || Selena || Education || South Texas Attractions || World Wide Web