"I'm getting tired of this," said David Chalupnik, head of equities for Nuveen Asset Management, when I asked him to explain the latest series of erratic stock market moves.

Aren't we all?

In the past two weeks, the Dow Jones industrial average swung wildly, moving 400 or more some days. Market coverage is dominating the news, resurfacing the all-too-familiar questions facing individual investors in choppy times like these -- What the heck is going on and what do I do?

It's impossible to pinpoint exactly what makes the market go up or down on a given day. Much of the trading is electronic, computers programmed to profit from tiny market moves, seemingly disconnected from the value of the companies that make up the market to begin with. Sometimes I question whether it's worth all the energy we expend trying to figure out why stocks are zigging or zagging.

That said, I checked in with local market strategists who have participated in the Star Tribune's annual Investor Roundtable to get their thoughts about what's happening on Wall Street and how us Main Street folks should react.

They didn't pinpoint a single event that caused this manic market, or a single reason why we chose the first two weeks of August to panic. Many of the issues -- the ballooning U.S. deficit, debt problems in Europe, and high unemployment -- have been nagging at investor confidence for years.

Brian Belski, chief investment strategist for Oppenheimer Asset Management, said the under-the-wire debt ceiling agreement and S&P downgrade added to "a crescendo of news" that pushed some traders into freakout mode.

Beth Lilly, small-cap fund manager for Gabelli Woodland Partners, hopes the reaction to the debt ceiling debacle will serve as a wake-up call to politicians who have been more concerned with their reelection campaigns than the state of the economy. "What went on in Washington two weeks ago was embarrassing for this country," she said.

David Joy, chief market strategist for Ameriprise Financial, blames the "intractable debate" about raising the debt ceiling for destroying budding consumer confidence. "I think it's going to cause them to put their wallets back in their pockets," he said.


As for which way stocks are headed, you won't find consensus here.

Belski, who's bullish on stocks, thinks that Washington will turn its focus to job creation, which is necessary for stock market growth. He's proposed tax incentives for corporate America to hire workers.

Jim Paulsen, chief market strategist for Wells Capital Management, says he thinks stock prices have become unhinged from fundamentals, which is "frightening." But with the Japan tsunami, bad weather and $4 gas behind us, "we've got wind at the back of the boat."

Steve Leuthold, founder of the Leuthold Group, is heading for the bunker. Just 45 percent of his group's core portfolio is currently invested in stocks, and he said that could go as low as 35 percent in the coming weeks. "I think we're in a terrible crisis of confidence here .... I think eventually you'll get down to a valuation where you can shut your eyes and buy stocks and you're going to make money, but we aren't at that level yet." His Grizzly Short fund is going gangbusters so far this quarter, up 17.6 percent.

What should average investors do?

•Evaluate your risk appetite: Chalupnik hopes investors took a cue from 2008 and have already rejiggered their portfolios to match their risk tolerance. If not, they'd better figure this out because market volatility is now the norm.

If you are still getting some z's, Chalupnik says you shouldn't be "decreasing your risky assets and following the crowd into gold and Treasuries." But he also recognizes that preserving principal is a must for retirees and workers hoping to retire soon. "I do think the average individual investor is going to own less risky securities going forward in retirement. They're going to have to."

•Don't sell: "Unless you're retiring or need money in six months, it's the exact worst thing you can do," Joy said. On the other hand, if you are heading into retirement or are retired, he suggests having three years' worth of living expenses in cash.

•Don't open your account statements: "We'll look back and say, 'Oh, do you remember those days in August?' and the market will be higher two years from now," said Lilly.

•Rally the Federal Reserve to raise rates: Leuthold says the Fed keeping interest rates so low is a "great disservice" to individuals, who have no income-producing safe haven for their money, and lack access to some of the attractive fixed income opportunities available to institutions or the super-wealthy. "What are you going to do? You go and you buy a bond fund and you're going to lose money when interest rates eventually go up. Right now, I guess, all I can say is put it in cash or put it under your mattress, for heaven's sake."

•Think stocks that pay dividends: "The dividend yields are very competitive vis-à-vis bonds," said Joy. Plus "large cap stocks tend to hold up better anyway" in uncertain markets.

•Believe: "At the of the day, if we really believe in our heart that the U.S. is not going away and that we're open for business ... you want to find good assets," Belski said. He suggests investors look for companies that consistently grow, even if slowly, that are in tangible, understandable businesses.

Kara McGuire • 612-673-7293 or kmcguire@startribune.com. Twitter: @Kara_McGuire