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Posted on 09/16/2001 8:27:18 PM PDT by Professional

I'm a Financial Consultant for a large bank. For those of you that care, here our some of my thoughts, recent events, based on my 10 years in the business.

I have 725 clients and manage about $45 million in assets. These clients are typically blue and white collar folks with medium sized net worths. These people essentially are your "average" American investor.

Not one single customer called with pending "sell" orders. In fact, since Tuesday the branch and my office were like a ghost town. Between customers and employees in tears, all we did was follow the news. On Thursday, my assistant and I called most of our top clients to discuss events. They were very happy we called with news that we were fully operational, but they weren't worried excessively.

I told clients that our bank, the subsidiaries of our company, and our strategic partners were all operational. The European and Asian markets had stabilized somewhat after an initial panic sell off. I let my clients know that their fellow customers weren't heading for the exits.

Since the market had already sold off for over a year, downside was already in the market, sparing us of a DRAMATIC down move. As tragic as the event was, the capital spending to rebuild NY and the activity of the fed would act as a stimulus. Furthermore, Vanguard and Invesco have reported similar declines in calls and very little sell activity.

That said, I did warn of heavy volatility at least through the remainder of the year, as earnings continue to greatly disappoint. There's no kidding ourselves, we will all be affected financially by this event, in the short term.

Fortunately, I've always been pretty conservative with clients. Many of them have high quality bonds in their portfolios and a good mixture of equities has spared them of significant damage. Still,there has been no way of avoiding the bear market we are in. I'm feeling this like you folks no doubtedly are.

Some advice? Well, don't panic, selling now and timing a re entry successfully is virtually impossible and makes losses magnify. If you were lucky to have a very large bond or cash exposure, maybe do some buying. There have been 7 rate cuts in this year. This has happened 4 times in the past, resulting in an average of 24% by the S&P 500 and over 40% by the Russell 2000 (smaller companies). This could actually be a very good buying opportunity, as most market recoveries are signified by the WORST of news. No more money to invest? Well, read the food section of the paper instead of the finance section until things get better. There is no law that says you have to read your statements!

Playing the event for gain usually backfires. Don't call about casket companies etc... In fact, calling your broker and giving him an encouraging word is not only thoughtfull, but puts you at the front of the line next time you need GREAT service or fresh ideas.

This has been a tough time for clients and financial institutions alike, even without tragedy. I wish you the best. I've always loved FR for the deep expertise that WE all bring, happy to share in my two areas, food and finance.

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