Wealthy, Nervous About Stock Market, Even More Concerned With General Economy: Survey
Not even the rich feel good about the U.S. economy.
A recent survey of affluent investors found that over half of them are pessimistic about the performance of the stock market in the near future -- and more than three quarters of them are pessimistic about the economy as a whole.
The survey respondents are also less sanguine when it comes to their own investment portfolios, with pessimism on that score doubling since last year, and optimism falling by nearly half.
Bearish outlooks on the national economy are hardly uncommon right now, with unemployment at discouragingly high levels and markets on a hair trigger over the possibility of a debt disaster in Europe. Wages have essentially stagnated for many workers, and the collapse of the housing market has wiped out millions of dollars of homeowner wealth, leaving a growing number of people anxious about the economic health of the country.
While the wealthier tier of Americans would seem to be insulated from most of these concerns, a survey from PNC Wealth Management finds that a growing number of affluent people are losing their peace of mind.
Fifty-four percent of the people surveyed by PNC said they were pessimistic about the performance of the stock market in the next six months -- up from 34 percent a year ago. Only 19 percent said they were optimistic, down from 40 percent last year.
One reason for the trepidation about the stock market might be the market's volatility in recent months, which had much to do with the debt crisis in Europe and political intransigence in Washington. Both of those conditions are likely to affect the market going forward, with France facing a credit downgrade from Moody's Investors Service and the Congressional debt-reduction committee admitting Monday that it had failed to reach an agreement to bring down federal spending.
That market volatility has a more tangible effect on wealthier Americans, who more often have a significant percentage of their wealth tied up in stocks. Yet the majority of stock market gains continue to go to an exceptionally exclusive club: the top 0.1 percent of earners today account for nearly half of all capital gains, according to Forbes.
Meanwhile, a full 76 percent of respondents said they were pessimistic about the overall economy -- a sharp rise from last year's rate of 57 percent. Just 10 percent said they were optimistic about the economy, down from 23 percent in 2010.
This kind of pessimism echoes the consensus of many economists and analysts, who believe the country's economy will only grow at a slow rate in the next year -- if it doesn't lose momentum entirely and slip into a double-dip recession.
The poll reached out to people with a salary of at least $150,000, and investable assets -- that is, money available for investment -- of at least $500,000. That puts the survey respondents well above the average worker in terms of wages: As of 2010, the median salary for U.S. employees was down to a 12-year low of $26,364.
This isn't the first time this year that wealthy Americans have registered their anxiety. In September, a Gallup poll found that 80 percent of affluent Americans said that the economy was getting worse, a higher rate than middle- or lower-income Americans.