ON WALL STREET: The other day a letter from the landlord was pushed under my apartment door.
It said: "Dear resident, the FBI has informed residential building owners and managers that a general, non-specific threat of terrorist activitiesmay exist for apartment buildings. . . If you should notice any suspicious activity or odd behaviour that causes you concern, please contact the FBI field office (telephone number supplied). . . These are trying times for our country and we are hopeful that none of us will have to deal with the activity addressed by this general threat.
Indeed we are, but the letter was hardly reassuring. New York has been jumpy since US Vice-President Dick Cheney said that another terrorist attack was a near certainty, and Defence Secretary Donald Rumsfeld warned that terrorists would inevitably acquire and use nuclear, chemical or biological weapons, on top of which the FBI reported threats against New York landmarks such as Brooklyn Bridge and the Statue of Liberty.
In a Time/CNN poll, 73 per cent of Americans said they took the threats at least somewhat seriously, and a Gallup poll found that 65 per cent of the public thought acts of terrorism were somewhat or very likely in the ensuing few weeks. This is the highest anxiety level recorded since November and it is felt most acutely in Manhattan.
To ensure that they don't "have to deal with" terrorist activity in the future, many Manhattan residents are thinking about leaving the island, with its vulnerable bridges and tunnels.
On a drive up Route 9W in the Hudson Valley on Saturday, I was told by several estate agents that more Manhattanites than usual are cruising around looking for vacant houses and condominiums.
In pretty waterside towns such as Piermont and Nyacks, the number of New Yorkers looking at the few available local properties has soared in the couple of weeks since the threats began. Property is climbing steeply in value - the price of apartments in one Nyacks condominium has risen 25 per cent since last year - whereas real estate values in Manhattan could well slump if another attack comes.
Indeed, house values pretty much everywhere across the United States have kept up despite the economic downturn, which only ended a few months ago.
One compelling reason is that property looks to be a better bet than stocks for long-term investment.
ONE of the paradoxes of the recovery is the failure of the stock market to rebound at the same time as economic data. The climate of uncertainty is being blamed for depressing the value of stocks and convincing the highest number of investors since September 11th that now is a bad time to plunge on Wall Street.
Sam Palmisano, president and chief executive of IBM, was reported as saying that "the fundamental issue we're dealing with is uncertainty". He blamed "geopolitical uncertainty in the aftermath of September 11th and the war on terrorism, and market uncertainty in reaction to the flame-out of the dotcoms and Enron".
The latest PaineWebber-Gallup Index of Investor Optimism found that optimism slumped dramatically in April and May. Only 63 per cent of investors think now is a good time to invest in the markets, compared with 71 per cent in March.
Some 40 per cent say they are less likely to invest in stocks or mutual funds, with the decline in interest most pronounced among those with more than $100,000 (€106,150) to invest.
This is understandable. The Dow Jones Industrial Average has fallen below the watershed 10,000 mark eight times this year, most recently on Tuesday of last week, and on Monday it had its biggest one-day points drop since February 4th.The Nasdaq composite is down by some 20.5 per cent since January 1st, and the Standard & Poor's 500 most popularly traded companies is off by 8.5 per cent.
Faith in the integrity of the markets has been eroded badly. A widespread mistrust of accounting practices and of the too-cosy relationship between analysts and investment bankers is responsible for dragging down stock prices, according to the majority of those surveyed.
The looming threat of war in the Middle East, and between India and Pakistan has also kept investors on the sidelines, not just in the United States but in Europe: the same poll conducted in Britain, France, Germany, Italy and Spain for April showed that 34 per cent of investors are pessimistic about European stocks, up from 31 per cent in March.
This all has far-reaching implications for Wall Street. Investor confidence is not likely to return any day soon. Property looks much more attractive. It will also be some time before New York recovers its pre-September 11th confidence that life in the city will continue as normal, especially with letters shoved under the door like the one I received last week.
Many New Yorkers hope that Cheney, Rumsfeld and the FBI are just crying wolf to obscure the uncomfortable truth that the administration's best and brightest failed to connect the dots before September 11th. Many share the scepticism of commentators like Maureen Dowd of the New York Times.
Al-Qaeda, she told us, will not find it easy to penetrate the apartment blocks of Manhattan. "First, the Qaeda rats would have to find an empty, affordable apartment. Then they'd have to get past the withering front line of real estate agents. Finally, they'd have to penetrate the maximum security defenses of Manhattan co-op boards."
Add to that the virtual impossibility of getting past the New York apartment concierge and you have real homeland defence.
