April 6, 2000


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Cool heads of individual
investors save Wall Street

By Phillip Fiorini, and Max Showalter

Journal and Courier

Again, the individual investor appears to have saved Wall Street.

Instead of joining the madness that sent stocks spiraling out of control around midday Tuesday, the individual investor heeded the lesson learned in October 1987 and decided that unless he or she is turning 65 this week, there's no need to panic.

In other words, let Wall Street have Wall Street, the investor on Main Street is saying.

Too bad those many investors who borrow money to make a buck on Wall Street don't understand the notion of investing for the long haul.

"You don't lose money until you sell," said individual investor Rich Johansen of Lafayette.

"Basically you buy stock for the sake of the dividends you'll get in the future," said P. Raghavendra Rau, a finance professor at Purdue University's Krannert School of Management.

Though Wednesday was still bumpy for investors -- the Dow Jones industrial average lost another 130.92 points to close at 11,033.92, while the Nasdaq composite index rose 20.33 to 4,169.22 -- it was far from the chaos that churned stomachs around the world Tuesday.

That day, the Nasdaq and Dow each dropped more than 500 points. The stampede swiftly reversed as buyers returned in search of bargains, and most stocks ended the chaotic session with only moderate losses.

On Tuesday, the Nasdaq and the Dow each recorded their widest point swings in history with record volume, with blame ranging from the fallout of the Microsoft Corp. antitrust ruling Monday to pseudo-day traders facing margin calls to the general uneasiness about the stratospheric prices for many


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