WASHINGTON, D.C. - The Investment Company Institute's 2002 General Membership Meeting opened last week with a discussion of changing investor priorities and how mutual funds can respond. Recent events - most notably the market downturn and events of September 11 - have caused investors to become less certain about the future and more risk averse, and as their overall priorities are changing, so is their spending and investment behavior, according to industry executives.

"Suddenly we wake up one day and the marketplace has undergone a dramatic shift, and consumers' priorities have changed," said J. Walker Smith, a managing partner at Yankelovich Partners, a Norwalk, Conn.-based marketing consultant firm specializing in consumer trends.

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