Trust in the US financial system and in Government has crashed to alarming levels.
According to the latest Chicago Booth – Kellog School Financial Trust Index, which surveyed more than 1000 American households, found that only 20% of those surveyed currently trust the financial system and that 11% of the respondents withdrew money from the bank and kept it in cash during the crisis.
Alarmingly, the study also found that US Government intervention had left 80% less confident of investing in the market. Three out of four admitted they had lost confidence as a result of recent federal intervention. Among those who opposed government intervention, 95% had lost confidence.
These sorts of figures are striking because trust is not something that can be easily restored. It might take many years to bring it back, even after the recovery comes.
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