Spectrem Millionaire Investor Index (SMII)TM Down 14 points to 5

The Spectrem Millionaire Investor Index suffered its largest single-month plunge ever, exceeding an 11 point drop in June 2006. Falling from mildly bullish down to neutral territory, the index gives up a half-year of gains.

The Spectrem Affluent Investor Index dropped sharply into neutral territory. Its largest single-month plunge ever, giving up a half-year of gains. territory, for only the second time in the past 12 months.

Both the Millionaire and Affluent Indices have suffered their largest single-month drops since the measure’s inception in 2004. A month after the February 2007 global stock market plunge, the previous sentiment of cautious optimism has given way to an overall gloom among the affluent.

Spectrem research shows, however, that the shocking, February 27th global stock market sell-off, is just one of the factors leading to this month’s negative outlook among the affluent. When asked to identify the “most serious threat to achieving household goals,” affluent households did not point to any one factor, as they usually do, but instead indicated a wide array of issues they were concerned about. Even factors which have scored traditionally high, did not illicit a reaction this month.

This decline was also reflected as the affluent sounded a general retreat from new investments in the coming month, with all categories—from stocks to bonds, and cash equivalents to mutual funds—dropping, often sharply. The only investment that witnessed a slight rise was Real Estate.This wide-ranging disengagement is alarming, because it indicates a general pessimism and hopelessness about the overall economic and political environment.

Millionaires, who are often more intuitive than other classes of citizen investors, reacted most negatively to recent developments, with their index falling more sharply than the Affluent Index. Millionaires also expressed more concern about the economy than non-millionaires, choosing to cut back sharply on stock investing.
Surprisingly, non-millionaires showed slightly more interest in stock investing than millionaires. But unsurprisingly higher numbers for Not Investing than millionaires.Stunned and pessimistic, the affluent are pulling back from their bullish stance to regroup in neutral territory.

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