Newspaper article THE JOURNAL RECORD

Tumble Makes Investors Feel Poorer

Newspaper article THE JOURNAL RECORD

Tumble Makes Investors Feel Poorer

Article excerpt

NEW YORK -- The stock market's nosedive is making investors feel poorer, even if the losses are only on paper.

As stocks have skidded to recent lows, folks across the country say they are tightening the purse strings on purchases and have stopped calculating their portfolios' losses.

"I won't even look at my 401(k). I know it's a disaster," said Jennifer Romanello, of Woodmere, N.Y.

However, Romanello feels the hit is big enough for her to curb unnecessary spending, as she did recently when shopping for a diaper bag.

She had her eye on a bag at Saks Fifth Avenue, but the 35 year- old publicity director had to think over the $100 price tag.In the meantime, she found a $10 bag at a discount store.

"Six months ago, I would have gone for the Saks bag. If you think about it, it is silly to spend that much on a diaper bag anyway," Romanello said.

Romanello's not alone.

"I'm a whole lot poorer," lamented Sally Bradford, 60, a retired homemaker in Lexington, Ky., who estimates her portfolio is down about 30 percent from last year. "If I needed the money right now, I'd have to settle for a lot less."

Like many investors, the euphoria of last year when the Nasdaq was up above 5,000 has given way to dismay now that the Nasdaq has shed more than 60 percent of its value.

"It's selling because you think the market psychology is going down and you want to get out," said Robert Shiller, an economics professor at Yale University who also specializes in investor behavior.

The Nasdaq slipped below 2,000 on Monday, though recovered somewhat Tuesday, closing above 2,014 on the heels of a 4.8 percent gain.

Investors became particularly alarmed when they heard Intel Corp. and Cisco Systems Inc., so-called tech blue chips, say business would continue to slump.

"They were the leaders. Nobody ever faults you for owning the leaders," said Charles White, portfolio manager at Avatar Associates. …

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