Guess What: Investors Are Turning Away From Stocks in Droves
- Posted on October 3, 2011 at 9:07am by
Becket Adams
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The stock market is profoundly unstable and it is manifesting itself in the form or low consumer confidence.
There are several reasons for this. Take for example the fact that more than half a trillion dollars in paper gains were made and lost within just two weeks in September. The S&P 500 jumped 5 percent in the week ending Sep. 16, the second best week this year. The next week it plunged 6 percent, the second worst week this year, according to the Associated Press.
These wild swings have made investors nervous about putting money in the stock market. “It’s like an elevator with only two buttons,” said Jeffrey Sica, president of Sica Wealth Management in a recent report. ”If you see one button says ‘surge’ and the other says ‘plunge,‘ you’re not going to get on the elevator.”
This volatility, large jumps followed by deep dives, within the course of a week or sometimes the same day, is not helping. This is what has been blamed for preventing companies from going public and scaring investors out of stocks. Some think that even if Europe resolves its debt crisis, the large, unpredictable price swings will continue.
To get an idea of just how volatile the market has been, consider these facts:
- The Dow Jones industrial average has gained or lost more than 200 points in a trading day 16 times since the start of August.
- Six of those days came in September.
- In the first seven months of the year, that happened just four times.
- The long-term trend is toward more volatility. Judging by the number of times in a year the S&P 500 swung 2 percent or more in a single day, markets are much more likely to have large leaps up or dives down, according to S&P’s equity research group.
- Swings of 2 percent occurred an average of five times a year from 1950 to 1999.
- It has already happened 20 times this year, with three months left to go.
Since the start of the heavy turbulence in August, the only company that has dared to make a public offering was the Chinese online video website Todou Holdings on Aug. 16. The backlog of companies waiting to debut in an IPO has never been larger.
“All the volatility has made for an unfavorable IPO environment,” said Claude Courbois, managing economist at Nasdaq OMX’sresearch department in a recent Associated Press report. “An IPO is your coming out party, a chance to tell your story. You don’t want an enormous amount of uncertainty surrounding it.”
Some have said that it looks like 2008 all over again. Retail investors withdrew $36 billion of U.S. stock funds in August, according to preliminary data from the Investment Company Institute. That is second only to the $47 billion withdrawn from U.S. stock funds at the height of the financial crisis in October 2008.
“The swings themselves have eroded the confidence of investors,” said Jeff Kleintop, chief market strategist at LPL Financial. “It’s the sign of a market and an economy not on sound footing.”
Thinking that the marketplace would settle if the Federal Reserve’s efforts to help the economy came to an end in June, Sica, the wealth manager, told his clients to keep at least 10 percent of their savings in stocks. Since then, he has advised them to get the rest of their money out completely.
“This is the first time in 20 years that I’m totally out of stocks, unfortunately. Just because something declines, it doesn’t mean it will ever come back.”
The Associated Press contributed to this report.






















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Comments (63)
Robert999
Posted on October 3, 2011 at 2:06pmIf Wall Street falls, then the American capitalist free-enterprise systems falls. This is one more reason to replace the socialistic government Social Security system with private stock market accounts. This will save Wall Street and American retirees too.
Report Post »Joe Schmuck
Posted on October 3, 2011 at 2:24pmRobert – I am on SS and I agree with you. One of the biggest problems I see is trust. No matter how they change the system, how can you trust that your money will be there when you go to retire? The govt. is like a druggie. Money is their fix. They write the rules. Logic says when they know it’s there and need it bad enough, they will get it.
Report Post »CulperGang
Posted on October 3, 2011 at 12:49pmhmmmm………..“when obama gets done”…………yeah, and so why is everyone waiting around to be done in??????????? This is why Liberals with their imbecilic ideas win all the time……..they don’t sit around to be done in……..they raise hell. conservatives……….well as long as it hasn’t touched them personally ………they deal with it until they are wrung dry. That is what this renegade adminsitration is doing to you……..wringing you dry.
Report Post »Jaycen
Posted on October 3, 2011 at 11:25pmThe biggest reason people are turning away from stocks are the artificially low interest rates. Conservatives need to educate themselves on economics. People have got to understand the terrible insanity that is the Federal Reserve, fractional banking, and central banking (it’s all the same thing).
Weimar had the same thing prior to the rise of the third reich.
Report Post »Guitar Master
Posted on October 3, 2011 at 11:34amzzzzzzzzzzzzzzzzzzzzzzzzz
From The REPORTER
zzzzzzzzzzzzzzzzzzzzzzzzz
Those that are in the stock market are big-time traders who move the markets. They fish the average Joe in as they allow the market to climb. When, and only when they feel like it, they will move the market lower and cash in on all the average Joe’s money.
To be in the market of today is like playing Russian roulette with 6 bullets in the cylinder. Get it, you imbecile you?
Report Post »metalurgy
Posted on October 3, 2011 at 11:43amYup.
Report Post »lionslayer44
Posted on October 3, 2011 at 1:45pmaGREED this and the 447 bil. is the nail in the coffin of our republic. BE PREPARED COLLECT FOOD, WATER (FILTERS), AMMO!!!! GOD BLESS AMERICA!!!!
Report Post »Salamander
Posted on October 3, 2011 at 9:01pmHedge funds, near zero transaction costs, no ‘friction’ in the markets, technicals decoupled from fundamentals, major participants, such as Soros, are skimmers, sucking up every chunk of value as it appears, without offering ANY intrinsic value, such as liquidity to the markets! They add only volatality, NOT liquidity and certainly no intrinsic value! We can thank the SEC and Congress for this mess, the first for lack of oversight and misunderstanding the danger in frictionless transactions and the latter in the repeal of Glass-Steagall, which separated commercial banks from investment banks for so many years! Now, it’s just one, too big to fail, messy glob of confusion–like everything else in our present economy! We’re in for ONE, ROUGH RIDE!
Report Post »Centralsville
Posted on October 3, 2011 at 11:22amEven a fool could see what would happen when the baby boomers all began to retire. It is the first generation to not have children. Bad in a socialist system where one generation depends on the next in their old age. Instead of having children we imported millions of poor Mexicans to fill the void, about the same number as the number of abortions in America. Poor Mexican immigrants are not goig to fill the void. Couple that with our failed schools, our failed families and the lack of Christian morality, the future is pretty bleak. Millions of old baby boomers with no children leaning on the broke government to be taken care of.
Report Post »GhostOfJefferson
Posted on October 3, 2011 at 11:38amEven boomers with children are out of luck if the boomers are hard core statists. Most of GenX turned out to be individualistic government rejecting libertarian-conservatives.
Sucks to be a statist boomer I guess.
Fortunately my mother and father are straight up strict constitutinalists, as is most of my family. Most of my friend’s parents however are not. Sad days.
Report Post »chuck_wagon
Posted on October 3, 2011 at 11:06amSome times the negativity of you people amazes me. We will defeat our dear leader chairman obamao and turn this country around. I always have and always will believe in our system and will continue to invest in it. Just you all wait when he’s humilitated next year, you’ll see a Resurgence in capitalism like never before. Chill out guys, and don’t give up!
Report Post »GhostOfJefferson
Posted on October 3, 2011 at 11:40amI agree with you, my only concern is that these rather sad hooligans aren’t quite smart enough to not start throwing molotov cocktails. They’re easily riled, fully emotion based and prone to temper tantrums. Meaning, even their “masters” don’t have a lot of control over their unpredictability once they assume a mob mentality.
We win in the end, agreed. Hopefully peacefully as your post hopes for.
Report Post »metalurgy
Posted on October 3, 2011 at 11:42amObama may be defeated but we already passed the rubicon on the debt. It can‘t and won’t be paid back.
The economy will collapse, we will default and the dollar will be worthless. Not enough money in the world to service the deficit let alone pay the debt. No politician is serious and the last budget and future ones are complete jokes.
The economy is toast no matter what politician is elected. The only thing they can do is soften the landing of the ultimate crash and shorten time it will take to play out.
Ron Paul is your best bet, but not even he can stop what is coming. I‘m sorry but there isn’t 15 trillion in gold on the entire planet to pay off our debt.
This is just simple math.
Report Post »chuck_wagon
Posted on October 3, 2011 at 12:51pmI can agree with both you guys. And I also agree it will be painful in the short term no matter who gets elected in 2012. But we need to start, that’s the key. I truly believe we can overcome this if we act now. GET RID OF OBAMA!!!!! (and get a true conservative in there to take control).
Report Post »Constructionist
Posted on October 3, 2011 at 10:57am@ Simply One Voice
Report Post »Good link, the translated German article was very interesting. You don’t see a lot of common sense in American newspapers today.
msaright
Posted on October 3, 2011 at 10:51amThese are perilous times indeed! Buy stocks that pay dividends. There are companies out there that are still making money. I have never given in to the fear that makes people get completly out of the market only to buy back in after it’s coming back, you miss all of the increase in between and buy back in at higher prices. It’s been said you make your money when you buy it! PM & oil will have a ceiling I believe we’ve seen this a couple of times within the last few years. Mfr’s having multiple price increases in the same year only to come back and lower prices a few months later. The anti capitalists are foaming at the mouth – this is exactly what they want. Don’t let them have it!
Report Post »DanWesson455
Posted on October 3, 2011 at 10:55amMy NY Deferred Comp plan is all in a stable income fund. It doesn’t pay much, less than 3%, but it doesn’t lose money. I have been there since early of 2007 thereby saving all I had put away before the 08 down turn. With all the paper crap Washington has put into place such as Dodd/Frank, I do not know when it would ever be safe to look for growth in the US Stock Market. I don’t think money managers have any idea either.
Report Post »elihu
Posted on October 3, 2011 at 10:47amWell, if the administration‘s ’Plunge Protection Team’ had not been propping up the stock market for years now, we might have a more stable market that could possibly straighten itself out – Not now!
Report Post »UnreconstructedLibertarian
Posted on October 3, 2011 at 10:46amMutual funds were always a racket to get constant influxes of un-supervised cash from the “average Joe”. You keep donating, somebody else “supervises” your money. They were about as big a Ponzi scheme as Social Security – depending on constantly entering cash flows to satisfy current demands.
This was fine till the “Boomers” accounts all came due at the same time. Wall Street has the same problem as Social Security – but nobody will examine or inform you of that. Wall Street has a mechanism to “harvest off” the gains that Washington does not have – market manipulation. Wall Street is harvesting out the gains made in the last 15 years in attempt to get ahead of the “Boomer” outflux of money – unless they convince you to use an annuity – which is an extention of their scheme.
For us “average joes”, I’d say take all your money out in hand – invest a portion into hard commodities (particularly those of lasting value or in preparedness) and force the banking system to raise interest rates so you can invest your money closer to home with better guaranteed rates of return. Ya’ll forget, we can hold money out of the system too – the hot shots don’t want you to realize this.
Everybody at the top is afraid of “deflation”, but you should realize that is the means by which your actual money appreciates. Forcing higher interest rates is how your money should grow right under your eyes. Lower prices is what makes your money go further.
Report Post »junkmaninohio
Posted on October 3, 2011 at 10:44amAnyone that invests their hard earned money in a market driven by fear, rumor and uncertainty deserves to lose it all. Stay out of the stock market and instead invest in land.
Report Post »Centralsville
Posted on October 3, 2011 at 10:27amThere isn’t anywhere safe to put your money. It is hard watching Western Culture die but any fool would have seen it coming from the most evil, vile, selfish, degenerate, spoiled, corrupt generation the modern world has seen, the Baby Boomers. They are the generation spoken of in the Bible. The generation to bring about the end. Your gold will have to be used in secret because the government will come after it.
Report Post »GhostOfJefferson
Posted on October 3, 2011 at 11:03amWestern culture is not dying. Socialism is, but that’s a good thing, and it certainly doesn’t constitute the whole of Western society.
Report Post »Libertarian
Posted on October 3, 2011 at 6:42pm@Centralsville,
I agree. I think the baby booming generation is not going to bring about a revolution of capitalism, rather this self entitled group is conditioned to have their government cheese.
Look at the tea party, 76% of them want government hands off their Social Security. Fellow Republicans in my farming county salivate over state sponsored subsidies (socialism), in the form of property tax shifts.
This “I paid into something I don’t agree with, so I am going to use it even though I don’t agree with it” mentality. Have some principle my fellow conservatives, give to Caesar what is Caesars, but ask not for a dime from this cancer of the free market. Don’t perpetuate the cycle.
Report Post »cntrlfrk
Posted on October 3, 2011 at 10:08am‘
I believe a lot of the money started moving to commodities, whether it be Gold, or corn.
Once people see the light at the end of the tunnel, and Obama’s hands are either tied, or he is gone, you will see money flowing back into the market, commodities will drop like a rock, people will blame Beck for the drop in gold, and we will have another “Farm Crisis” on our hands similar to the early ’80s after we got rid of the original Jimmy Carter.
.
Report Post »Outlaw_Josey_Wales
Posted on October 3, 2011 at 10:05amI’m invested in Gold, Silver, Food, Firewood, Water, cloths and supplies I will need for the next 5 years. All I need to do is close the doors and windows on the bunker.
Report Post »manuelbetten
Posted on October 3, 2011 at 9:57amDoes anyone mention that most of the pension funds for peoples retirement is in the stock market? It the stock market goes then the pensions go, they are the same thing.
Report Post »vennoye
Posted on October 3, 2011 at 10:30amNo they don’t mention that. I shake my head at these public service unions doing what they are doing. It is reported that their pensions are only funded in the 50-60% ranges. Union members are actually watching the union bosses dig their (member) graves while the members are supporting the digging! This is intelligence???????
Report Post »Salamander
Posted on October 3, 2011 at 9:15pmLast I heard, you don’t have to be intelligent to join a union! In fact, in many states, if you have a job, you HAVE joined a union, whether you want to or not!
Report Post »metalurgy
Posted on October 3, 2011 at 9:48amI’m out of paper. Cashed everything in for PM’s (precious metals), first aid, water, and non perishable goods.
I know, don’t put all your eggs in one basket. That’s why I diversify in gold, silver, platinum, palladium, nickel, copper and lead.
Good to go. No worries.
Report Post »SpankDaMonkey
Posted on October 3, 2011 at 9:46am.
Report Post »Time to buy……..
Harold B
Posted on October 3, 2011 at 9:33amThe government has so integrated itself into our lives and business that when the government stumbles everyone gets a scraped knee. Do not worry however Obama has a plan to tax all the money out of the nation and we can start again with government and as co-partiner
Report Post »Snowleopard {gallery of cat folks}
Posted on October 3, 2011 at 9:49amIndeed…they make the rules, control everything, and dominate everyone…so we will be junior partners on the order of a elephant to a mouse.
Report Post »db321
Posted on October 3, 2011 at 9:51amWhen Obama gets finished, if you try to buy bread with US Dollars – the vender will laugh at you.
Report Post »teebubba
Posted on October 3, 2011 at 9:32amThe market might drop another 10 or 15 % but it won’t collapse. Most American companies are earning money and many pay dividends which are higher than any other investment available. There are trillions of dollars sitting in investors brokerage money market accounts waiting for the opportunity to go back in the market.
Report Post »metalurgy
Posted on October 3, 2011 at 11:35amwell yes, if you have thousands of shares where that .25 cent dividend will make a difference.
Most people don’t have that kind of cash.
A 100x earnings ain’t gonna help and if the dollar is no longer the reserve currency well, then you’re hosed and hyperinflation kicks into high gear. Look, we’ve added over a half trillion to the debt since 4/14/2011.
We are in a debt spiral that will end in default even if you tax every billionaire and corporation 100%.
Their is not enough wealth in the world to pay our debt. We are going to collapse and so will the dollar because it is worthless.
Report Post »forthepeople
Posted on October 3, 2011 at 9:28amPM’s ( precious metal ) can never go to ‘0’ like paper ( stocks ) can . Gold has been going up for 11 years now and they still call it ‘ a bubble ’. Silver is the next ( has been for some time now ) to rocket up for it has been suppressed by a few for some time now. It is now $30 and will be at least $50 and many say much more .
Report Post »awall1231
Posted on October 3, 2011 at 9:32amHistorically Silver has been at 1/16th the price of gold. It should be at $100 an ounce right now. If it all collapses, PMs will be the new currency. That is why i like buying silver for now. I dont want to only have ounces of gold to barter with. Just mu opinion.
Report Post »aesaac
Posted on October 3, 2011 at 9:46amgold is down to $1,600 as gold starts to fall and it will, who do you think is going to buy it at $1,600 or $1,400 – a thing is worth what you can sell it for or make it – gold costs $550 to mine – you may have an ounce of gold at $1,400 there will be no pawn shop, no refinery, that is going to buy your gold at what you paid for it – until you get to the cost of production you will have no buyers – why do you think Soros dumped at $1,600 – the dollar is backed by armament -
Report Post »DanWesson455
Posted on October 3, 2011 at 10:59amCan’t eat metal.. Heritage Seeds, good farming land, knowing how to grow, can and preserve food will serve you better when all else fails or comes down. Food is the ultimate barter. When your hungry how much will you pay for a decent meal?
Report Post »BOMUSTGO
Posted on October 3, 2011 at 9:27amGeorge Soros is grinning from ear to ear.
Report Post »simply one voice
Posted on October 3, 2011 at 9:48amExcuse me. Did I just hear the Truth?
Report Post »Dismayed Veteran
Posted on October 3, 2011 at 9:26amIf you are a “buy and hold” investor, the market is scary. If you are a day or swing trader of stock options, the market can be very profitable.
Report Post »simply one voice
Posted on October 3, 2011 at 9:51amSure. Just beat out the Super Computers in this extreme Ponzi scheme.
Report Post »GhostOfJefferson
Posted on October 3, 2011 at 10:13am@One
It’s not a ponzi scheme. I know that’s a popular phrase to throw around right now, but look up the definition. It is clearly not one, please don’t try to twist definitions, when I invest in XYZ company it does not depend on others investing as well for me to profit, rather, it depends on the companies quarterly statements and earnings and profit dividends.
I respect what you’re saying otherwise, just wanted to be clear on terminology.
Report Post »simply one voice
Posted on October 3, 2011 at 10:21amThanks, really. I smile. Are you a Broker by any chance? Just wondering humorously.
Report Post »junkmaninohio
Posted on October 3, 2011 at 10:45amYou have to beat out the program traders as well. The stock market is a game for the small suckers.
Report Post »GhostOfJefferson
Posted on October 3, 2011 at 11:07amNo, I’m not a broker nor anybody with a vested financial interest regarding making a profit from the stock market off of others (meaning, selling them something). I’m just somebody who likes to keep definitions clear and correct.
Report Post »UnreconstructedLibertarian
Posted on October 4, 2011 at 9:23amThe market itself is not a Ponzi scheme, but it is certainly used to facilitate Ponzi schemes.
Report Post »cntrlfrk
Posted on October 3, 2011 at 9:23am‘
I pulled most of my investments our of the market once I realized Obama was going to be ‘elected’
About late 2007.
Won’t get back in until I am sure he will be going away.
.
Report Post »michael48
Posted on October 3, 2011 at 9:40amCIF=cash in fist…UOG= until omama GONE…shuttered my buss. 6:30 AM 11/04/08, have saved or created $100,000.00 for ME…STRESS FREE…when the Marxist , spoiled little BRAT is gone , then I’ll fire back up…until then , HAVEN’T a clue what the rules are at Midnite tonight , let alone next week…
Report Post »SamIamTwo
Posted on October 3, 2011 at 9:20amIt’s been unstable for years…propped up by the federal reserve…bubbles popped. 401s are now 101s.
Report Post »awall1231
Posted on October 3, 2011 at 9:20amI for one have been buying silver whne ever i can. Im not a rich man and have a family to provide fr, but anyone can buy an ounce now and then. Its a hard asset that can fluxuate alot in just a few days. for the most part it has been doing better than gold. Just a thought if you dont have $1,650 lying around to purchase 1 ounce of gold.
Report Post »SamIamTwo
Posted on October 3, 2011 at 9:22amCoins, silver and gold. :thumbsup:
Report Post »awall1231
Posted on October 3, 2011 at 9:28amand no paper trail.
Report Post »simply one voice
Posted on October 3, 2011 at 9:55amAs my faithful economic guru, Gerald Celente would say, it‘s the 3 G’s; Gold, Guns and a Getaway Plan. Something to ponder.
Report Post »Snowleopard {gallery of cat folks}
Posted on October 3, 2011 at 9:11amThe collapse is almost at hand people; get ready for the next part of the storm to hit, and it will be with the force of a hurricane and a earthquake togeather in one massive shock.
Report Post »GhostOfJefferson
Posted on October 3, 2011 at 9:19amI’ve noticed that the local news, a quite conservative/libertarian friendly station (and huge, largest AM market in central Ohio) has started covering the “march on Wall Street”. These idiots (the leadership of the Left) are intent on getting their way or they’ll burn down everything and take everybody with them in their ideological death throes. What savages.
Report Post »Snowleopard {gallery of cat folks}
Posted on October 3, 2011 at 9:48am@Ghost — I have to say that is wonderful indeed, Lord willing we will be able to pull this nation out of the fire and survive the storm that is now hitting us; there was a report over the weekend in the UK telegraph and UK Indepednat newsjournals about how “savings around the EU and the World are reaching unsafe levels…driving us into a great depression…”
Right now the European bankers are warning of the depression hitting again, and even credit defaults have begun to be admitted by the Chinese govenrment according to many websights reporting in India.
By the middle of November, figure six weeks at most, the world will turn itself upside down so fast and hard, unless God interveins in stopping it or redirecting it, almost everything will come fully undone…which is exactly what Soros and the administration want to happen.
Report Post »simply one voice
Posted on October 3, 2011 at 10:06amIn Germany’s news, Spiegel this morning, the truth was really laid out flat and, I suggest everyone read the front page on-line article that begins. “US President Barack Obama has recently suggested that Europe must take on more debt to stimulate the economy. Such reliance on cheap money, though, is what got us into the current crisis in the first place — both in Europe and in the US. America‘s problem isn’t too little money. It’s a lack of competitive products.” A Commentary by Michael Sauga.
http://www.spiegel.de/international/
Fabulous truth; really.
Report Post »GhostOfJefferson
Posted on October 3, 2011 at 10:20amIt’s always a good thing to keep the faith, for certain. What’s interesting is the count-movements going on and the division of lines being made in bright clear ways. For example in Ohio gun rights are going through a renaissance, with support from peace officers (in most places, with a few notable exceptions that are even now being expelled from the system). I openly carry in public and more and more people are for example (went to an “open carry” picinic in a state park yesterday for example, talked with a park ranger for a while in a pleasant way), and law enforcement generally nods, smiles and waves. We’re seeing communities drawing together more in a good way (well, at least here where I live), lots more of that old time neighborhood feeling coming down as we begin to realize as a group that we’re all in this together. Lots more talk at public events against government, by “normal” non political people.
We’ll not only be here after the flames are down, chances are most of us will be there to stop the arsonists before they get a good grip on the cities.
Slainte
Report Post »simply one voice
Posted on October 3, 2011 at 10:32amGhost…
Love to shake your hand and meet you on the firing range. No talk of Bernie Madoff stuff,though, like the NYSE, ok? Now commodities like Ag and Au are a different thing. ;-)
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