Trust in the U.S. financial system has fallen to 20%in March from 26% in December, as measured by the Chicago Booth/Kellogg School Financial Trust Index, which surveyed 1,007 adults to obtain the reading.
This low level of trust is equal to the readings in the earliest months of the financial meltdown, when the index stood at 20% in December 2008 and 19% in March 1009.
Likewise, the percentage of Americans who are angry about the country’s current economic situation increased from 52% in December to 57% in March, near the 60% who felt this way in December 2008, in the early stages of the financial meltdown.
Authors of the index survey believe Americans’ trust in the financial system may have been shaken by Japan’s earthquake and subsequent the Fukushima Daiichi nuclear plant disaster, as well as the sluggish housing market.
Trust in mutual funds fell from 31% to 25%, trust in the stock market fell from 16% to 12%, and trust in banks fell from 43% to 32%. And whereas in December, 40% said they believed there is risk of a large drop in the stock market, in March that rose to 50%.
“The latest findings show how fragile and temperamental the country’s financial system is right now, even as we slowly climb out of the recession,” said Luigi Zingales, co-author of the survey and professor of entrepreneurship and financial at the University of Chicago Booth School of Business. “This drop in trust offers some insight into how global catastrophes can affect Americans’ trust in the financial institutions where they invest their money.”