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AMERICA'S SMALL INVESTORS ARE ANXIOUS BUT NOT READY TO HIT THE PANIC BUTTON YET
----PBS Nightly Business Report/America's Research Group Survey Gauges The Mood of Small Investors ----

New York, New York, April 2, 2001
The small investor has taken a wait-and-see stance towards the stock market and the economy in general, says a survey created for PBS's Nightly Business Report by America's Research Group (ARG). "58.2 percent of the investors surveyed are holding fast on their investments," says C. Britt Beemer, chairman of ARG. "Maybe it's because only 3 in 10 small investors will need to access their money in the next 8 years, or only 1 in 10 expect to need access within 3 years. Though clearly concerned over recent stock market losses and bad financial news, they still feel they have time to see what happens."

ARG surveyed 1,002 investors last week, asking them how they felt about the current bear market. Qualifying respondents had $25,000 invested either in the stock market, mutual funds, or in their 401k retirement accounts. Their mood in light of the gloomy financial news is cautious:

• 47.7% of Americans are feeling less confident about the US economy with only 12.4% being more confident. This negative rating is at a dangerous level putting America into a "recession mindset"
• The small investor is even more leery of the stock market with a ratio of 7 to 1 feeling less confident about the stock market than just three months earlier
• 7 out of 10 small investors think America is in a bear market and few of them believe the situation will reverse until the fall or into next year
• While 58.2% are in a wait-and-see attitude, 28.5% believe it is a good time to invest now in the stock market
• Most (57.4%) believe the worst is not over. And only 32.3% want to "go it alone." 52.1% will now rely more on an advisors help in managing their investments
• 1 in 5 monitor their investments every day with 3 in 10 following their investments at least 2 times a week up to every two days
• By a vote of 64.6% to 30.2%, investors didn't think the Fed lowered interest rates enough last week. Of those who disapproved, 59% wanted to see a full 1% drop and 41% wanted 3/4 of a point. 26.3% blamed Alan Greenspan for not acting more quickly, but only 21.0% believe he should step down as Chairman of the Federal Reserve
• 21.3% have cut back spending due to their market losses, and 27.4% have reduced their spending because of their fears about the economy
• 19.4% have reduced or cut back on vacation plans (a big number of households in the US)
• Nearly 1 in 2 believe additional major layoffs will occur in the near future and this will cause them to work longer hours at a rate of 3 to 1
• 59% distrust the media who they believe has made the economic slowdown a bigger story than it should be

"When 12% of consumers reduce their spending, that is serious for the retail sector," says Beemer, "but reductions on spending of 21% by consumers based upon of stock market concerns and 27% because of fears about the economy tell us that a broad segment of America clearly is in a recession mindset."

C. Britt Beemer is available for interviews.
For more information Contact America's Research Group.

America's Research Group, Ltd. (ARG), is a full service consumer behavior survey research company with more than 20 years experience. ARG has interviewed more than 4 million consumers. Utilizing both quantitative and qualitative research, the firm works with clients to develop practical and successful marketing strategies for pace-setting companies in the fields of home furnishings, appliance and electronics retailing, banking and finance, automobile dealers, department stores, specialty and mass merchants. Clients include Sealy Mattress, Barnes & Noble, AT&T Wireless, Eckerd Drugs, Broyhill Furniture, Thomasville Furniture, American Eagle Outfitters and many others. ARG claims a plus or minus 3.8% accuracy.

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