markets have many Bermudians wondering when -- or if -- global market chaos will wash up on Bermuda's sheltered shores. Despite it's relative protection behind the powerful US economy Bermuda, like the rest of the world, could find its economy buffeted by forces outside its control. Reporter Nicole Williams Smith set out to find what the investment pros forecast, and what the average Bermudian can do to weather the storm For the moment the average Bermudian can rest easy, claims Emerald Financial's president David Bolden.

Mr. Bolden said the recent stock market turmoil was prompted by last October's economic problems in Asia and the recent mayhem in Russia.

"Investors became concerned that countries doing trade with Russia and Asia would suffer,'' he explained.

"Investors were worried that the trouble would spread to Europe and then firms like Coca Cola would loose sales.

"The stock market instability was the result of investor's perceptions that firms and banks would suffer as a result. That there would be a slowdown.

"What you have is the stock market reacting to global activities, trying to predict how global events would affect profits.'' Ministry of Finance economic advisor Ron Holberton said the full indirect impact of the Asian/Russian turmoil may take some time to be felt in Bermuda.

"It is one of those events that will take time for the impact to be felt,'' he said. "Russia and Asia are pretty far removed and we do not have a huge exposure to Asia, so there will only be an indirect impact.

"If it slows down the global economy it could have a worldwide impact on interest rates. It should put a damper on interest rates.

"But interest rates in Bermuda do not change with the US rates.'' And Mr. Holberton said there were no easy answers for the general public who are trying to sort out how the recent stock market upheavals will effect them and their portfolios.

There are no clear answers or crystal balls, he says, to help predict global economic moodswings or the events that drive world market psychology.

A case in point says Gulfstream Financial Limited's Managing Director, Chris Hough, is while the US economy remains strong and somewhat sheltered from Asia and Russia's woes, they are not immune from their own, homegrown problems -- and their problems are Bermuda's problems.

There has been and could be more negative fallout from US president Bill Clinton's Oval Office excapades with White House intern, Monica Lewinsky, he cautions.

Last week, as revelations of Starr report rocked the US Congress and public, the American greenback fell to a sixteen-week low while the Dow Jones Industrials dropped 249 points, before recovering slightly at the close of the trading week.

If the US Congress becomes locked in a battle to impeach the president says Mr. Hough, the American economy could feel the effects: "If there is a negative impact (from Congress) on the markets, then Bermuda will be effected indirectly,'' Mr. Hough explained. "A lot of local institutions hold US investments, and they will feel it.'' Adds Mr. Holberton: "For most (Bermudians), all the turmoil will result in a negative impact but it will vary depending on their circumstances.

"If they have money invested in stocks, they will feel the drop in the market. A lot more people are owning shares in the stock market so when it drops, a large number of people will not feel as wealthy as they use to. This will probably mean that they will not spend as freely.'' Ann Kast, of Kast Investment Management, said: "There is a lot of volatility in the markets and volatility is another term for risk.

"We are definitely in volatile times and this tends to make people cautious.

Cautious people tend to spend less and save.'' And Mrs. Kast heralded the benefits of savings and pointed out that people should always save -- no matter what the economic climate.

Mr. Holberton said a decrease in global spending could slow down tourism -- one of the two pillars of the local economy.

"But maybe Bermuda has a niche market and that segment of the population, who take cruises -- or are middle-class to wealthy -- may not put off their travel plans.'' And Mrs. Kast points out the historical connection between the US and Bermuda's economies.

"You could see a decrease in tourism if cautious Americans decide to save their money and not take a trip to Bermuda,'' she explained. "It happened in the 1991 recession.

"I don't think we are heading into a recession, but all of this nervousness is about whether the Western world is going into one.'' A recession occurs when a country's living standards decreases while prices increase. Once a country's gross national product (GNP) declines for at least two quarters (there are three months in a quarter) it is considered to have entered into a recession.

"I don't think we are into a recession; the US economy is strong,'' she added.

Mr. Holberton agrees, Bermuda he says is "no where near a recession''.

"It would be an extreme reaction for all of this to cause a recession,'' he said. "The probability of an out-and-out recession is low.

"There may be a slow down in the American economy, but the European economy is doing well so far.'' For those contemplating making major purchases or doling out dollars in the near future, Mr. Holberton said the disturbances on the other side of the world should not play a huge factor in making your decision.

"What is needed is a closer look at home,'' he explained. "Because of what's happening in Asia, someone should not put off their decision.

"They should just concentrate on what's going on in Bermuda, in their lives and their income when making personal financial decisions.'' And with respect to the job market, Mr. Holberton said Bermudians should not worry about their employment security.

The job market should be fine,'' he said. "It is strong and there is reasonable low unemployment.

"Often there is a mismatch in the job market -- jobs either require high skills or they are low paying. But there is opportunity out there.

"It is unlikely that a company here will go under because of this.'' And for those planning for their retirement, Mrs. Kast said the current upheaval in the market was an opportunity to pick up some good bargains in the equities and pensions markets.

"The beauty of retirement plans are that you have to buy every month,'' she explained. "Therefore you are now buying at low prices.

"This is an opportunity to pick up stocks at good prices.'' And she advised those who invest in the stock market to pass on high risk investments and opt for high quality assets.

"Avoid emerging markets like Asia and Russian,'' she advised. "They are high risk.'' Overall, the threesome said Bermuda should weather through the economic uncertainty relatively unscathed.

"I would not think that there was going to be a big impact on Bermuda,'' said Mr. Holberton. "If anything there will be a global slowdown.'' Mr. Bolden said: `For the average person here, nothing will change unless tourism is affected, but nothing like that is predicted to happen.

"Prices won't change, Bermudians should just carry on with business as usual.'' Mrs. Kast added: "I think we in Bermuda need to keep an eye on this and not panic.

"And it is always a good idea to save.''