U.S. Wealthy Distrust Wall Street, Fear Terrorism, Journal Says

Bloomberg Machine (no link) ^ | 6-25-02 | J. Kyle Foster

[BunnySlippers]

U.S. Wealthy Distrust Wall Street, Fear Terrorism, Journal Says

2002-06-25 08:45 (New York)

New York, June 25 (Bloomberg) -- The richest people in the U.S. distrust Wall Street and are fearful terrorism will affect the economy and securities markets, the Wall Street Journal reported, citing a U.S. Trust Survey of Affluent Americans.

According to the survey, being released today, 85 percent of respondents believe there should be tighter regulation regarding financial disclosure by publicly traded companies, the Journal said. Also, 73 percent said they don't trust the recommendations of equity analysts, and 66 percent said they don't trust the management of public companies, the Journal reported.

The possibility that terrorism would negatively affect the economy and securities markets is the biggest worry for 76 percent of the respondents, the Journal said.

U.S. Trust, a unit of Charles Schwab Corp., conducts the survey. The company said the top 1 percent this year includes those with gross income of more than $300,000 annually or net worth of more than $3.75 million. The survey was based on 150 telephone interviews with a margin of error of plus or minus 6 percent, the Journal said.

(WSJ 6-25 D2)

For the Wall Street Journal Web site, see {WWSJ }.

--J. Kyle Foster in the Princeton newsroom

[KineticKitty]

News flash to the Bloomberg Machine, it's not only the wealthy that doesn't trust wall street or fear terrorism. LOL. Or is it just more "real" when the "Affluent Americans" are quoted as feeling it? Newsflash..... DUH.

[liberallarry]

I suspect the wealthy never did trust Wall Street analysts or the management of public companies so not much has changed. And who isn't afraid that terrorism won't negatively impact the markets?

[Huck]

Also, 73 percent said they don't trust the recommendations of equity analysts

I wonder what these folks were thinking in 1998. I'm a millionaire! I'm a billionaire! Cisco at 115 dollars a share! It's a buy! It's a buy! MSFT at 99 bucks???Buy! Buy! Buy!

Man, I suppose I shouldn't knock em. They are still the top 1%. They must be doing something right. But somehow this just seems silly. Were they never skeptical about Wall Street practices?

[Voltage]

The very wealthy stayed away from the dot.com mess. Warren Buffet for example said it made no sense to him, so he stayed away.

By now it should be obvious that unless you are an insider, or have close contact with insiders, you should stay away too!

[Dog Gone]

Well, it just goes to show you that the rich aren't any different from the rest of us. They just have more money.

[Huck]

Here is the US Trust web site, with a bunch of data spanning the last bull market: http://www.ustrust.com/ustrust/html/knowledge/WealthManagementInsights/SurveyofAffluentAmericans/BehavioroftheAffluent.html Check out this excerpt from 1998: Choosing Investment Advisors

When choosing an investment advisor, wealthy Americans consider a number of attributes. However, 94% of the affluent indicated that "being trustworthy" was the most important characteristic.

Interesting. Imagine something so overwhelingly important rating so poorly right now. Might explain some things.

[Huck]

Sorry that was a mess. I thought the thing would format itself. Here it is again:

Here is the US Trust web site, with a bunch of data spanning the last bull market:

Us trust Surveys

Check out this excerpt from 1998:

Choosing Investment Advisors

When choosing an investment advisor, wealthy Americans consider a number of attributes. However, 94% of the affluent indicated that "being trustworthy" was the most important characteristic.

My point was that this is a very important factor for investors. It appears they rely on a trusted advisor. That trust is very shaken right now. Not good for Wall Street.

[kcvl]

*I can't imagine why? /sarcasm*

Massive fraud reported at WorldCom

EBITDA said to have been inflated by $3.6 billion in last year

By David Faber
CNBC

June 25 — WorldCom has engaged in what people close to the company describe as a massive fraud, which has only recently come to the attention of its board of directors. According to sources close to the company, WorldCom has inflated its EBITDA by some $3.6 billion over its last five quarters, by taking as capital expenditures, costs that should have been treated as ordinary. The company is planning to restate its financials in the near term to reflect the financial misstatements that have taken place.

[ladyjane]

So there are 150 individuals who make over 300 thousand a year who answer the telephone and agree to be interviewed about money. Sure there are.