Introduction: When the stock market performs poorly, people’s wealth decreases. And that can affect labor force participation, and the following video clip explains.
PETER JENNINGS, ABC NEWS
So we're going to take A CLOSER LOOK at the brutal impact thefaltering stock market has had on many people who thought they wereabout to retire. The stock market's long swoon means that $7.7trillion in value has been lost in stocks since they peaked more thantwo years ago.
TEXT:
Stock Market
Since March 24, 2000 $7.7 trillion lost value
PETER JENNINGS
And middle-aged Americans are very heavily invested in stocks. Here's
ABC's Erin Hayes
ERIN HAYES, ABC NEWS
(VO) The news about the stock market is playing havoc with thisWisconsin couple's retirement.
JEFFREY NADOLNY
And I'll go out and I'll get a part-time job to supplement ourincome.
ERIN HAYES
(VO) Two years ago, the Nadolny thought they'd invested wisely. Theyretired early. Barbara, from the phone company; Jeffrey, from alocal factory.
BARBARA NADOLNY
We thought we were going to be able to travel.
JEFFREY NADOLNY
We've lost over $370,000. And that amounts to about 33 percent ofour total portfolio. The corporate CEOs are making hundreds ofmillions of dollars. And Barbara and I took a duping.
ERIN HAYES
(VO) Not an uncommon tale, as retirement funds invested heavily instock shrivel as the market slumps.
NANCY SMITH, RESTORETHETRUST.COM
Retirees are very scared about facing the future with diminishedresources. In some cases, their life savings have been slashed by 30to 50 percent.
ERIN HAYES
(VO) Nancy Smith, a former director with the Securities and Exchange
Commission, started an organization calling for truth in corporateaccounting. Retirees are e-mailing her every day.
NANCY SMITH
People are very angry about these accounting scandals. For the firsttime, the veil has been lifted, and they can see behind the scenes.
And what they're seeing is ugly. They're seeing lies, distortionsand half-truths.
ERIN HAYES
(OC) And losses. Americans, age 55 to 64, have invested more instocks than the average American has, nearly twice as much, hoping toquickly build retirement funds. But that is now backfiring for many.
DAVID CERTNER, AARP
Over the last year, there's been a large increase in labor force participation among those over the age of 55, a full 8 percentincrease. We think that the inability to retire, the inability toafford to retire is a key factor.
ERIN HAYES
(VO) The case for Jim and Jan Pringle@: starting all over again inthe ad agency business.
JIM PRINGLE
Two and a half years ago, we met with our broker, and he encouragedus to retire because we were doing really well in the market.
ERIN HAYES
(VO) They've lost half of what they had then.
JIM PRINGLE
We now have a new plan. We're aggressively out there, seeking newclients. And we're doing great work for them. Whether the marketgoes up or down, we're going to take care of ourselves.
ERIN HAYES
(VO) For millions of Americans, plans are changing as the stockmarket continues to lurch into uncertain territory. Erin Hayes, ABCNews, Atlanta.
PETER JENNINGS
When we come back, this evening, the final item in the broadcast. The
young killer whale hears the call of her family.
TEXT:
Orca female...
Average Length and Weight: 16-19 ft. 3-8,000 lbs.
Largest recorded: 28 ft. 16,5000 lbs.
Source: SeaWorld