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Show B-10 The Parr Record WedThursFrl, July 31 -August 2, 2002 1 -t- ', I I ) i . 4 . ; Market Scandals, recession and terrorism shake faith in stock market but don't break it By MONIKA GUENDNEH Of the Record staff "We're going to have to decide if we can live at our level of lifestyle," said Ralph Taylor, a retired resident of Pinch-rook. Taylor and his wife Gcorgina have some tough choices to make in the next year. "We have to decide if we have to move out of the house and into something smaller and cheaper." The Taylors are facing what so many of Summit County's residents now face: Their savings sav-ings have diminished substantially substan-tially over the past two years, throwing a huge new question mark into their future. Taylor, who has been retired for nine years due to a disability, has no plans to take what's left of his savings out of the market. If his withdrawals are the only dips into his savings, he has about 1 5 more months of money. His financial planner told him that some people have put a floor on how much money they are willing to lose in the volatile market. "I haven't chosen to do that," he said. "I don't know where you'd do any better." "The majority of clients recognize rec-ognize the need to hold on for the long run," concurs Mat Thompson, the Morgan Stanley Park City branch manger. Thompson said that only a very small percentage of his clients have pulled their money from their stock investments. Thompson describes his average aver-age clients as above 50 years old, with a higher net worth and with a major focus of saving for retirement. Despite the proximity proximi-ty of the end of their careers, his clients are redistributing their allocations rather than pulling them. "Some of them, very few, I will add, have wanted to throw in the towel," he said. Thompson's role has been as hand holder for clients, reassuring reassur-ing them the market will rise again. 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Situated on 2 VH-vt kns in mc oaks. $4,150,000 HIGHLAND ESTATES 222 t CounlryMile circle Situated on 1.18 aires, in .un sqll home Including mother-in-law at) affords views and everything you horses need $379,000 GRAND SUMMIT located at (V base of The Canyons 4u resort within the remarkable resort vJjgr, fa frpt I bed. 2 bath quarter share unit is steps away from the gondola. $149,500 RED PINE UNIT ideafy located Ihe Canyons siu icsor. Ms 1 hdrm unit fn)ovs moonlan nun mh hardwood hard-wood floors, common area ameniiir-s and access to stopes. $139,000 m - investors mistake of buying high and selling sell-ing low.)" Bill Mullen, certified financial finan-cial planner and owner of Mullenium Finance, is talking to his clients more often these days. "I am telling them just to The reality of the things are there; would join his the economy stays down, going to have to downsize. " - sit tight, as uncomfortable as that may be." Financial planners are also discussing alternative versions of retirement for people like the Taylors who are at or near retirement. The life style clients had envisioned for themselves three years ago may no longer be possible, said Mullen. The alternatives are unpleasant: unpleas-ant: trim down the life style they chose or continue working past their originally planned retirement retire-ment date. "The worst thing that can happen in retirement is you can run out of money," said Mullen. (Jetting a job at 65 is much easier easi-er than 80, he added. For Taylor, returning to work is not an option. His wife, however, how-ever, plans to work another 10 years, until she is 70. Taylor said she had intended to work that long, regardless of their financial finan-cial situation, but admits that right now, they need her money. "She has to keep working right now to maintain our lifestyle and our house," he said. Still, he considers himself lucky. 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II9SXXX) 1378 Aerie Drive , Fjrxious panoramic views. $238,000 Visit our website at . wwwoenroseDarkciYXom for additional information on theses properties or to preview all of Park still holding on until she retires. "That's held sacrosanct," he said. As they continue to discuss their future, Taylor is optimistic, but continues to plan for some sort of loss. "The reality of the things are there; if the economy stays down... we're going to have to downsize," he said. If that happens, a 'for sale' sign in front of his house .we re neignoors . He estimates that maybe a fourth of the houses around are on him the Ralph Taylor retiree market. T h e stock market does not only affect the retired or near-retired in Summit County. Thompson has a number num-ber of much younger clients who earn their money from restaurant restau-rant and ski service industries. "Investment has become so mainstream over the last several years," he said. Their longer timeframe make them better candidates for buying buy-ing now. "Smart investors are adding money in to their portfolios port-folios because the values are so u My advice to people to believe in corporate America." - Mat Thompson Morgan Stanley branch manager compelling," said Thompson. Most are simply keeping to their original plans of saving a specific amount over time. Whether they are saving for a house or saving for retirement, clients have been nervous for the past two years. Since September 11 and the rash of scandals in the news, "people have turned even 'more bearish and skeptical," said Thompson. Even though negative num- Efficient Professionalism The Penrose Connection 435 649-4550 800 641-1884 toee penroseparkcityuLcom vvvvw.penroseparkcity.com REAL ESTATE HIGHLAND ESTATES 6450 Snow View Drive J Sedrooms. 2.S baths, great room farngy room, large kitchen with wood floors, river rock fireplace and panoramic views $250,000 PARK AVENUE 249 Park Avenue - 4 Redrooms. 2 S baths on Park city Oof Course with wonderful views. FuVy kjmished with upgrades and great amenities $290,000 dtyls available listings. i .;-JrJHiD bers on monthly statements, may be hard to stomach, Thompson advises clients to keep informed on their investments. "I think you need to pay attention," he said. "I disagree with sticking your head in the sand." . Now is the time to reassess portfolios rather than ignore them, he added. Mullen pointed out that corporate cor-porate scandals are nothing new. The 80s saw the securities fraud and insider trading of Michael Milken. "Ten years from now something else will pop up," he said. "I think the markets are very resilient," said Thompson. "Their ability to bounce back is just as significant as their ability abili-ty is to pull down." The scandals of WorldCom and Enron may have pulled the market down quickly, but not entirely wrongly, said Mullen. It was unrealistic to think that profits would continue as they had, he said. "My advice to people is to continue to believe in corporate America. ..make sure you are diversified. ..stay focused on the long term," said Thompson. The advice may be hard to believe in a period where it seems that a new company admits to restating its profits each is to continue week, but is unwavering. unwaver-ing. "There's a lot of cynicism cyni-cism and I don't blame them," he thousands of said. "There are companies out there Don't let one or two bad apples spoil the bunch." As the future looks back at this period in history, today's scandals will seem less significant, signifi-cant, contends Thompson. "If you look at the radar screen over time, this is just a blip." Until then, however, "People are gritting their teeth and holding hold-ing on," said Taylor. Come See us for 2 for 151 577 Main Street 135-615-0300 . 1 Bring this ad with you and receive a complimentary entrle when you purchase one of equal or greater value Customer Name ) Address ' Attorney says state violated law; SALT LAKE CITY (AP) An attorney for some of the nursing homes involved in a dispute over how increased Medicaid reimbursement reim-bursement funds should be apportioned appor-tioned has accused the state of violating the open-meetings law. Attorney Jan Jenson said a meeting July 19 between some nursing home providers and Rod Betit, director of the Utah Department of Health, violated the law. She said the meeting was not publicly posted and was by invitation invita-tion only. Because the meeting concerned con-cerned how the state would distribute dis-tribute an additional 12 percent or $15 million in Medicaid funding, it should have been treated as a public meeting under state law, Jenson contends. Department of Health attorney attor-ney Doug Springmeyer said the state honored federal law on how extra money could be disbursed, and, have doing so, was not bound by state open-meeting and rulemaking rule-making laws. Utah gas SALT LAKE CITY (AP) Unusually warm weather expected next week in the Northeast pushed natural gas futures higher for the. region, but the scenario was the reverse for Utah and other Rocky Mountain states. With temperatures expected to reach an unusually high 95 degrees on Monday in Philadelphia and Washington, D.C., electrical utilities were poised to use more of the fuel to produce extra power to run air conditioners. Natural gas for August delivery rose 1.5 percent, or 4.2 cents, on the New York Mercantile Exchange to $2.94 for 1,000 cubic feet But in the Intermountain West, natural gas prices on Friday remained well below the national average, a condition that has existed throughout the summer and has more to do with the scarcity of pipeline capacity serving the region than a lack of demand. There always is a "basis differential" differen-tial" between the Rocky Mountain price and other areas of the country, Questar spokesman R. Curt Burnett said. "This year though, that difference differ-ence in price is wider than anyone our 1 Locals' At Main Street 435-65-0636 (Dm so Not valid with any other offer or promotion One free entree per ad Valid all open nights Offer valid June 1 thru August 15,2002 ; Reservations Recommended . "We do not believe the state, Rule Making Act applies in a sit-, uation where a state agency is applying a rate increase to an, existing methodology," he said. Springmeyer said that the state chose the shortest of all legal routes available to distribute' it. Jenson, who represents several nursing homes, said the change, proposed is significant and requires that rule-making acts on both the federal and state levels be honored. Utah nursing homes currently are reimbursed for Medicaid patients on a flat-rate basis, with a slight differential added for labor and property costs. Nursing homes are at loggerheads logger-heads over whether the money should be distributed uniformly! or if a differential should be provided pro-vided for those urban facilities with higher property and labor costs. . . , The Health Department is expected to reach its decision con-' cerning the $15 million within the next week. prices low can remember." ' The average price for 1,000 cubic: feet of natural gas in the Rockies! averaged $1.87 on Friday, up 3 cents for the day. . The Rocky Mountain states have a shortage of pipeline capacity. With nowhere for most of the natural gas' produced in the region to go, sup-' plies back up and prices are kept down. ' Questar is taking advantage of its excess production to increase natur- ' al gas storage for winter. The compa-' ny underground storage facilities now are holding approximately 53.3 billion cubic feet, up from 35.6 bil-; lion cubic feet last year at this time. Utah consumers used record' amounts of electricity earlier this month when temperatures soared throughout the state, Utah Power spokesman Dave Eskelsen said. ( Still, Utah Power did not need to increase its purchases of natural gas ' to produce the extra electricity its) customers were demanding. Only a small amount of the electricity Utah Power produces is generated by' burning natural gas. Most of the ' companyls electricity is generated ; from coal. ' - - t Special '4 it: immmmmmmmmmmmammmmmmmmm (PO$RC( |
