Many Americans say unfazed by Wall Street woes

KANSAS CITY, Missouri (Reuters) - Despite the market woes whipsawing Wall Street on Tuesday, the mood of many on Main Street was unfazed as people across the United States said the downturn was overdue and likely to be short-lived.

"I'm not scared," said retiree T.J. Smith, who moved to a Kansas City suburb a year ago from Florida. "I know we've got the most vibrant economy in the world. It will bounce back."

That sense of optimism was shared by young and old alike, and across income levels.

Some saw a steep slide in the stock market or commodity prices as a buying opportunity. Others were grateful for the Federal Reserve's slashing of U.S. interest rates, which could translate into cheaper car and home loans.

"It seems like a good time to buy," said Peter Harper, a 27-year-old student, as he walked into the office of a discount brokerage in midtown New York. "I'm trying to open up a brokerage account right now."

The Dow Jones industrial average dropped more than 3.5 percent on Tuesday morning before stocks staged a partial recovery after the Fed cut rates. The Nasdaq composite index has fallen more than 20 percent from its October peak.

The declines come amid fallout from a crumbling housing market, rising unemployment and recession fears, slowed consumer spending and higher food and energy costs.

Barbara Jarvis, a 44-year-old consultant buying coffee in Euless, Texas, said she was not making any adjustments to her 401K retirement plan despite the drop in value.

"My 401K is just dipping like crazy," said Jarvis. "I'm not panicking though. If I was retiring tomorrow I might be."

MOST VULNERABLE

Indeed, those seen as most vulnerable to eroding stock values are elderly Americans who rely on their savings and investments to supplement monthly government social security checks. Many regularly withdraw from those accounts to help pay living costs.

"If people are drawing more than 6 percent to live on, that is where it gets ugly," said Jean St. Pierre, a Kansas City-area financial advisor who cautions her retired clients to keep at least two years of expenses in cash accounts to weather market downturns.

Chicago office worker Ken Carollo, 32, said even though he was rethinking some home improvement projects and was nervous about how a slowing economy is affecting his finances, he worried most about his elderly mother.

"I feel bad for my mother, who relies on money from her investments to live on," Carollo said.

But even some retirees said they saw the setback as long overdue following a sustained rally in stock markets. They were hoping that their diversification across bonds, money markets and a mix of mutual funds would protect them.

Many have saved money for decades in employer-sponsored 401K retirement plans, in which employees direct part of their wages into investments.

"The market has been going up and up for several years and I just think it is overpriced," said Don Mocker, 72, a retired professor from Overland Park, Kansas, who relies on pension funds, social security and investments he says include a mix of stocks and bonds.

"The important thing is not to panic."

(Additional reporting by Ed Stoddard in Euless, Texas, Andrew Stern in Chicago and Robert Campbell in New York; Editing by John O'Callaghan)