Experts are warning ordinary taxpayers not to panic despite the latest government bailout of an American financial giant and another huge drop for the Dow Wednesday.

The Federal Reserve Board announced Tuesday it would step in and rescue American International Group with an $85 billion emergency loan, paying for it with taxpayer money. Lehman Bros. filed for Chapter 11 bankruptcy this week, Merrill Lynch was sold to Bank of America and there was also word Washington Mutual was in danger.

The Dow took another nose dive Wednesday, falling 449 points after dropping 500 points Monday.

However, Dr. Joel Evans, a professor at Hofstra University?s G. Zarb School of Business, says investors should hang tight.

As for the money that?s in these failing banks, experts say it?s protected by the FDIC as long as people?s deposits don?t exceed the federal deposit insurance limits of $100,000 for an individual account, $200,000 for a joint account or $250,000 for Individual Retirement Accounts invested in insured deposits.

It?s best to have accounts with FDIC-insured banks, experts say, and to spread large amounts of cash across different banks. For stockholders, Dowling College economic analyst Marty Cantor says now is definitely not the time to sell. He also says not to put too much 401(k) contributions into company stock and instead diversify.

Still, some say they?d rather be safe than sorry and put their money in something foolproof like government bonds. "I think the government [is the] only safest thing around now, ?cause they are bailing everybody out,? says Tony Carbone, of Syosset.

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