Stock Market Woes Widespread

by David W. Moore

Business scandals no help

GALLUP NEWS SERVICE

PRINCETON, NJ -- With the Dow Jones Industrial Average continuing to bounce around in the low 9,000 range, Americans have become considerably more dour about a wide range of economic questions than they were just over a year ago. At that time, March 14, 2001, the stock market had fallen through the 10,000 point level for the first time in almost two years, dropping 750 points in the previous five days of trading. But Americans did not seem as pessimistic in the wake of that decline as they are today.

A CNN/USA Today/Gallup poll conducted at the end of last month found two-thirds of Americans saying that the recent changes in the stock market have made them feel less confident about the nation's economy, up from 51% who felt that way in March, 2001.

Have Recent Changes in the Stock Market Made You ...?

Other effects of the stock market:

  • 64% of Americans say they will be less likely to invest in the stock market, up from just 40% who felt that way a year ago.
  • 53% expect to live less comfortably in retirement, compared with 33% who felt that way last year.
  • 49% are now less confident about their own personal financial situation, up from 29% last year.
  • 30% have seriously considered postponing or canceling a major purchase, up from 21% who said that last year.
  • 26% are less confident about their job situation, up from 15% a year ago.

The poll shows that the views of stock owners, about two-thirds of all Americans, are not significantly different from people who do not own stock.

Business Scandals Deter Investing

The poll also shows that a majority of Americans, 58%, say that the scandals involving large corporations make them less likely to invest in the stock market. Among stock owners, the percentage is virtually the same, 57%.

Survey Methods

These results are based on telephone interviews with a randomly selected national sample of 1,019 adults, 18 years and older, conducted June 28-30,2002. For results based on this sample, one can say with 95 percent confidence that the maximum error attributable to sampling and other random effects is plus or minus 3 percentage points. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

Do the recent scandals involving large corporations make you less likely to invest in the stock market, or not?

 

Yes, less likely

No, not less likely

No opinion

2002 Jun 28-30

58%

39

3



Next, please tell me whether the recent changes in the stock market have, or have not [RANDOM ORDER]?

A. Made you feel less confident about the nation's economy?

 


Yes, have

No,
have not

DOESN'T APPLY (vol.)

No
opinion

%

%

%

%

National Adults

2002 Jun 28-30

67

30

*

3

2001 Mar 14

51

46

1

2

1998 Sep 1

37

59

1

3

Stockholders

2002 Jun 28-30

68

31

*

1

2001 Mar 14

54

45

*

1

1998 Sep 1

38

61

0

1

In March 2001, the Dow Jones Industrial Average fell by more than 300 points and closed below 10,000.

In 1998, the Dow Jones Industrial Average fell by 513 points in one day and gained 288 points the next day.



B. Made you feel less confident about your own personal financial situation?

 


Yes, have

No,
have not

DOESN'T APPLY (vol.)

No
opinion

%

%

%

%

National Adults

2002 Jun 28-30

49

49

1

1

2001 Mar 14

29

69

1

1

1998 Sep 1

27

69

3

1

Stockholders

2002 Jun 28-30

52

47

1

*

2001 Mar 14

32

67

*

1

1998 Sep 1

27

72

*

1



C. Made you seriously consider canceling or postponing a big purchase, vacation or other expenditure?

 


Yes, have

No,
have not

DOESN'T APPLY (vol.)

No
opinion

%

%

%

%

National Adults

2002 Jun 28-30

30

67

3

*

2001 Mar 14

21

77

2

*

1998 Sep 1

14

82

3

1

Stockholders

2002 Jun 28-30

30

68

2

0

2001 Mar 14

24

75

1

*

1998 Sep 1

15

84

1

0



D. Made you less likely to invest in the stock market?

 


Yes, have

No,
have not

DOESN'T APPLY (vol.)

No
opinion

%

%

%

%

National Adults

2002 Jun 28-30

64

33

3

*

2001 Mar 14

40

56

3

1

Stockholders

2002 Jun 28-30

65

34

1

*

2001 Mar 14

42

55

2

1



E. Made you less confident that you will be able to live comfortably when you retire?

 


Yes, have

No,
have not

DOESN'T APPLY (vol.)

No
opinion

%

%

%

%

National Adults

2002 Jun 28-30

53

39

7

1

2001 Mar 14

33

58

7

2

Stockholders

2002 Jun 28-30

54

40

5

1

2001 Mar 14

33

60

6

1



F. Made you less confident about your job situation?

 


Yes, have

No,
have not

DOESN'T APPLY (vol.)

No
opinion

%

%

%

%

National Adults

2002 Jun 28-30

26

56

17

1

2001 Mar 14

15

66

19

*

Employed ^

2002 Jun 28-30

29

69

1

1

2001 Mar 14

21

78

1

*

Stockholders

2002 Jun 28-30

24

63

13

*

2001 Mar 14

18

67

15

*

^ Based on --647-- adults employed full or part-time



SUMMARY TABLE: CHANGES IN THE STOCK MARKET

 


2002 Jun 28-30
(sorted by national adults "yes, have")


Yes, have

No, have not

%

%

Made you feel less confident about the nation's economy

67

30

Made you less likely to invest in the stock market

64

33

Made you less confident that you will be able to live comfortably when you retire

53

39

Made you feel less confident about your own personal financial situation

49

49

Made you seriously consider canceling or postponing a big purchase

30

67

Made you less confident about your job situation

26

56



* -- Less than 0.5%

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