With Economy Holding Strong, Many Investors Standing Pat
Wall Street has caught Main Street's attention.
Truck drivers discuss Asian stock markets, and individual investors stop to stare at ticker tapes. Brokerage houses report phones are ringing and ringing. And some mutual funds have had to bring in their "corporate reserves" to help handle the inquiries.
Final market numbers were not available at press time, but, so far, Main Street does not seem to be reaching for the panic button.
Just look around, say individual investors. The US economy remains unchanged from last month. And many investors think standing pat in tumultuous times can make more sense than acting hastily. They are quick to point out investors who didn't panic in 1987 have profited well since then.
"The thing that has kind of amazed us in talking to investors is that the majority seem to be looking at this very much from the long-term point of view - that this happens in the market but it won't mean that much to me," says Thomas O'Hara, chairman of the National Association of Investors in Madison Heights, Mich.
At Fidelity Investments, the giant Boston mutual fund organization, share redemptions increased only slightly on Oct. 27, primarily for international and sector funds.
The trend was similar at discount broker Charles Schwab, based in San Francisco. The day brought $400 million in net redemptions for mutual funds, versus a normal net inflow of $50 million. To handle the extra volume, the company brought in 100 extra people.