Americans Stop Stressing About Economic Instability

Americans Stop Stressing About Economic Instability

Here's another smart story from our friends at Kapitall. Check it out:

People have a way of adjusting to all sorts of stressful situations, including market volatility.

A recent study by the American Psychological Association showed that Americans are becoming more used to shocks, and that the population of self-described “very stressed” individuals has dropped to 22%, down from 24% in the previous year and 32% in 2007.

So what’s easing the stress of the average American? Two theories reign. The first is that the survey itself is flawed.

The second, voiced by some psychologists, is that “after five long years of financial turmoil, Americans might—just possibly—be getting used to shocks. The type of instability and economic pain that used to spark stress, in other words, is losing its ability to unsettle people.”

Go With the Flow

Consider, says Gillian Tett of FT Magazine, before 2007 many economists and citizens alike thought America was on the right economic path. “That sense of stability extended into many non-economic areas, too: after the collapse of the USSR, it seemed that western capitalism had triumphed and trust in most western institutions was pretty high.”

But things changed, and people reacted. Studies show that in 2007, 65% of Americans trusted their banks. Today that number is 35%. Trust in the government isn’t much better.

“But, while this new mood of cynicism has some debilitating consequences, it also has an advantage: When people have already lost their innocence—or faith—they are less prone to being shocked … For the generation now entering the working world for the first time, such instability and pain might almost be the new normal.”

To read stock picks for a resilient American consumer, head over to Kapitall.

More on Investing

What is the difference between a mutual fund and an ETF? The answer is important for your portfolio. Find out!
When it comes to investing, you should ignore your friends. Here's why.
Avoid these three traps when looking for mutual funds.


Learnvest

Financial planning made simple.

Get your free financial assessment.

Related Tags

Get the latest in your inbox.

Subscription failed!

You're Now Subscribed!