CHICAGO (Reuters) - The turmoil on Wall Street sparked fear and anger on Monday as Americans watched markets tumble amid a make-over of financial giants whose names once seemed as good as gold.
“I’m horrified. I’m angry about it. Where has the government been?” asked Joanne Lucid as she sipped a morning coffee at a shop in Minneapolis.
Her companion, Kevin Winge, 49, asked if he’d reordered his investments, said, “It’s too late. I should have done that on Friday.”
Some interviewed at random around the country expressed a helpless resignation as they watched another sharp market fall following Lehman Brothers Holdings Inc’s bankruptcy, an agreement by brokerage Merrill Lynch to be bought by Bank of America and reports that insurance giant American International Group was seeking emergency help.
“Everything seems risky,” said Dave Finley, a highway contractor lobbyist in Columbus, Ohio, who said he was very concerned about the state of his 401(k) retirement savings plan. He said he planned no major changes now but felt at a loss to know what to do if he did revise things.
Kathy Jennings, a nurse in Columbus, said she and her husband, an engineer, are also worried about their 401(k) and other investments but don’t know what they should do.
Jim Trapp, a financial adviser with Fifth Third bank in Columbus, said his customers “see it as a very critical situation” and two of them have just moved holdings out of securities and into real estate investments.
“It’s very troubling,” said Oscar Perez, 52, of Coral Gables, Florida. “The economy is weak and when the giants start to shake, there’s trouble ahead. When the little guys shake, maybe it’s not so bad, but when the giants have problems, it could be a domino effect.”
“The big problem was all these big banks lending to people who should never have qualified for a mortgage,” he said of the credit crisis in the housing market which has roiled the U.S. economy for months.
WHO BENEFITS IN NOVEMBER ELECTION?
The impact on the race for the White House between Democrat Barack Obama and Republican John McCain was far from clear, though Paul Green, a political scientist at Roosevelt University in Chicago, said, “Any bad or real bad economic news helps the ‘out’ party.”
John Caffey, 50, of Green Bay, Wisconsin, said, “No regulation, low taxes ... that’s the Republican model. They are against any kind of excessive regulation. It’s just proven time and time again that when you loosen regulations, it’s a disaster.”
David Pinero, who recently relocated to New York in search of an information technology support job, said, “Probably Obama is the portrait of the sprit we need right now. I think he’s a very optimistic and reassuring individual ...”
In Louisville, Kentucky, Pat Hicks, 68, a retired trade association executive, said he doubted the country’s financial woes would be a plus or a minus for either presidential candidate battling to win in November’s election.
For the moment, he said, he is sticking with his financial adviser and not making any investment changes. But, he added, “We always read and we’re always told that all of these situations would never happen because of the way the government
structured it after the Great Depression ... we do have a lot of concern about that.”
Brian Perlin, 49, a Miami attorney and financial planner, said the present situation would work itself out but he was worried about the country.
“It seems like there’s been a mood shift. People are very very concerned about the economy ... I’m definitely being more cautious. I would tell my clients not to keep more than $100,000 in some institutions. I’m very concerned. I own a lot of bank stocks and they are really taking a beating.”
Ed Morris, a writer in Nashville, Tennessee, said, “Even at the risk of losing what small savings I have, it’s a joy to see capitalism shown up for its abuses. I think it will make it tougher for the (Republicans) to win.”
But Jude Werra, who owns an executive search firm in Brookfield, Wisconsin, said, “Just because the press has something to report, and just because someone is spiking a fever, does that mean they have to get under the covers and drink lemon juice? I have delegated that to my financial adviser ... I am not going to get alarmed.”
In midtown Manhattan near the Lehman headquarters, Chris Lakumb, 34, a visitor from Chicago who works in the investment business, said, “It’s going to be much worse than it is today. Anyone who says the worst is behind us is wrong.”
Additional reporting by Jim Leckrone in Columbus; Steve Robrahn in Louisville; John Rondy in Milwaukee; Pat Harris in Nashville; Jim Loney in Miami; Todd Melby in Minneapolis; and Claudia Parsons and Christian Wiessner in New York; Editing by Cynthia Osterman
Our Standards: The Thomson Reuters Trust Principles.