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GREENSBORO — The fallout on Wall Street could stretch to Elm Street here as investors assess Monday’s historic shakeup that killed one financial giant and crippled two others.

As many as 500 workers at Greensboro’s United Guaranty Corp. office downtown are paying close attention to the news from parent company American International Group, which is struggling to raise enough cash to stay afloat as its stock plummets.

AIG is reviewing its operations and discussing alternatives with others to sell parts of the company or receive loans.

AIG. Lehman Brothers. Merrill Lynch. Amid a relentless stream of bad news from Wall Street on Monday, brokers spent much of their day trying to calm jittery investors, reminding many that it’s a good time to buy and keep in mind the long-term nature of their investments.

“Take a deep breath,” said Jonathan Smith, managing partner of Greensboro’s Jonathan Smith & Co. Investment Counsel and a registered investment adviser.

Learn all you can about your investments, and look for high- quality stocks, preferably those that pay dividends, he said. You can find some bargains in a down market.

“We believe that if we focus on companies that have the ability and willingness to reward patient stockholders,” Smith said, “then we have no reason to stay glued to the TV for the latest headline.”

Still, the news Monday was hard to ignore:

* Lehman Brothers, a 158-year-old investment bank choked by the credit crisis and falling real estate values, filed for the biggest U.S. bankruptcy ever and said it was trying to sell off key business units. Lehman fell under the weight of $60 billion in soured real estate holdings.

* Bank of America added to its growing financial services empire, buying Merrill Lynch in a $50 billion deal that would create a bank that offers everything from fixed-income trading to credit card lending.

Merrill’s Greensboro office is the third-largest brokerage in the Triad, according to a 2007 survey by The Business Journal, with more than 80 licensed brokers.

* AIG’s United Guaranty, which provides mortgage insurance to banks, has been hard hit by the foreclosure crisis. As of June 30, it insured $31.8 billion in mortgages. The 60-day delinquency ratio was 4.9 percent. In comparison, it insured mortgages of $26.5 billion and a delinquency ratio of 2.5 percent on June 30, 2007, according to SEC documents.

United Guaranty’s Judy Johnston, the senior vice president for corporate marketing and communications, declined to comment on AIG’s situation. She said the Greensboro labor force fluctuates from 450 to 500, not including contractors, temporary workers and interns.

Monday’s biggest winner was Charlotte-based Bank of America, but the world view it gave wasn’t the most comforting.

During a news conference, Bank of America Chairman and Chief Executive Officer Ken Lewis said it could be 18 months before the nation’s economy will become strong again.

That’s a bleaker outlook than just a week ago, when experts hailed the federal takeover of the Fannie Mae and Freddie Mac mortgage companies as marking the bottom of hard times.

“I’d be hesitant to give an exact time frame,” said Matthew A. Martin, an economist at the Federal Reserve Bank of Richmond’s Charlotte office.

But he agreed with Lewis’ overall view.

The Associated Press contributed to this report

Contact Richard M. Barron at 373-7371 or richard.barron@news-record.com