“As stocks continued their brutal selloff Monday, the ramifications for one group of Americans were already evident in a canyon outside Las Vegas,” writes Bernard Wyscoki in today’s Wall Street Journal.

“A lavish retirement development called Sun City Anthem opened there four years ago, an icon of the boom years. Its 75,000-square-foot “Anthem Center” includes a ballroom, indoor pools and spas, art and ceramics studios and a huge fitness center.”

“But a few months ago, the developer, Del Webb Group, scrapped plans for a third luxury golf course. Instead of using the land for more lush greens and fairways, it will build some houses that are smaller than most at Anthem, costing just $130,000 to $220,000.”

“It’s because the 60-somethings are scaling back. ‘Two years ago, they would say, “Show me the most expensive house on the most expensive lot,” says the developer’s president, Anne Mariucci. Today, it’s ‘show me the best I can get for $150,000.’ “

“Del Webb spotted the first signs of caution in early 2001 among people on the verge of retirement, and it has seen this inclination to retrench increase ever since. It’s a pattern that meshes neatly with what has happened to the stock market: ragged in 2001 and a disaster in recent months.”

“Del Webb calls people in their late 50s and 60s the ‘Ikes,’ as in Eisenhower generation, a label suggesting the conservatism and quest for stability long attributed to them by pollsters. Now, approaching retirement age, they see instability all around, above all in the vulnerability of their financial nest eggs.”

” ‘The stock-market situation is causing them huge amounts of anxiety, and you can trace this to their coming-of-age experience, the 1950s, when times were good,’ says Charles Schewe, a professor at the University of Massachusetts who has studied generational beliefs.”

“Prof. Schewe speaks from experience: He is about to turn 60 and has seen some of his stock investments sink. His position in EMC Corp., a data-storage company, was once valued at more than $2 million, but EMC’s stock is off 90% from its high. His own anxiety is lessened because he isn’t on the brink of retirement, he says: ‘I’ve got more time, and things will change.’ “

“But those closer to retirement or already retired are being forced by the stock-market plunge to ponder unsettling questions. Their aggregate loss, totaling billions of dollars, raises the question of whether pain this bad will reshape their behavior on three key issues: going back to work, selling or not selling their homes, and where to put their financial assets.”

“How they respond will have sweeping implications beyond the Eisenhower generation, affecting the entire U.S. economy. If more of them hang onto their jobs longer, they’ll affect job opportunities for the young. If more sell their houses, the increased supply will weigh on prices as it adds to availability. If they shun riskier investments, it will be that much harder for stocks to mount a comeback.”