Concern about the national economy's prospects led to a sharp decline in confidence among affluent investors during the third quarter, according to a survey scheduled for release today.
McDonald Financial Group's quarterly Affluent Consumer Confidence Index said its confidence measure had fallen 10 points since June 30, to 42 out of a possible 100, its lowest level since April 2003.
"This is a stagnant market with difficult interest rates, and employment rates are still not very good," David Legeay, a senior vice president at McDonald, a subsidiary of KeyCorp in Cleveland, said in an interview Friday.
The survey said affluent Americans' intentions to spend and invest in the next three to six months had slipped after staying strong in recent quarters. About 54% are more focused on preserving assets than generating new wealth. This attitude has steadily grown this year, Mr. Legeay said."Folks are keeping their money on the sidelines in cash or in bonds, and there is an unwillingness to commit money to the stock market," he said.
Furthermore, 57% in the survey said the economy is headed in the wrong direction, the highest reading for this measure since the index was begun in January 2003. The index is based on a nationwide survey of 400 randomly selected people with more than $500,000 of investable assets.
