Some, Especially The Young, Fear The Stock Market [AUDIO]
The past 10-12 years have seen some big stock market reverses from time to time. And those reverses may have soured some younger investors.
There was the so-called, “internet bubble burst” of 2001 when a lot of overpriced Dot-coms collapsed. Then there was the economic downturn that started in 2007 and saw stocks plunge thousands of points.
Mercer County stock expert Ken Kamen says we may be losing a whole generation of younger investors who are afraid of those market problems. But Kamen also points out that 401k’s and pension plans have replaced social security in saving for the future. He says, “We are all becoming stockholders whether we want to be or not, or whether we realize we are or not.”
Stocks remain favored by millions of Americans who invest big parts of their retirement savings in them, and investors who have held the course have benefited from the 29 percent rise in the benchmark Standard & Poor’s 500-stock index since the beginning of 2009. This does not include the dividends that would have been earned.
Kamen says it is much easier for people to imagine bad events happening in the future and unfortunately, we have trouble imagining positive future developments. But economic growth also happens and so do stock market gains.
The Dow Jones industrial average rose an average of 8.4 percent each year from 1950 to 2000, with some extended periods of little to no growth.