Decline in Stock Prices in America - 2002-07-22

The stock indices in America are still low but have recovered some of their previous losses, while President Bush is trying to reassure Americans that the foundations of the U.S. economy are strong. The Dow Jones Industrial Average, which is the most important measure of the economic power of the U.S., has dropped 300 points in the last two weeks due to a lack of investor confidence, losing about 15% of its value, which is unprecedented since the severe market crash in 1987. During a visit to the Argonne National Laboratory near Chicago, Illinois, the President told reporters that he is neither a stockbroker nor a stock market commentator, but he is optimistic about the state of the U.S. economy. Recently, investors in America have become cautious due to scandals in the accounts of some major companies that have led to their bankruptcies. Among these unfortunate developments was the announcement of the bankruptcy of the major telecommunications company 'WorldCom' earlier this week. This is considered the largest corporate collapse in U.S. history. WorldCom's bankruptcy occurred about a month after the revelation of deceptive accounting practices that reflected the company's expenses as $4 billion less than the actual amount. The head of WorldCom stated that the reorganization of the company will take at least until the end of next year, and during this time, employee salaries and debts to equipment and service vendors will be paid.