"Through 2010, giving was really struggling in terms of getting donors to commit to the same level of giving that they had previously met," says McGlaughon. "By the first part of 2011, giving was really picking up. But in the last few months, the volatility in the markets has slowed that down again."

He says the trend now is that people are hesitating to make long-term commitments because of the sine wave market gyrations in the stock market. That is affecting giving in the short run. But it remains to be seen what 2011 will look like until the end of the year, since the fourth quarter is usually the biggest one for making donations, when people do more charitable giving for the holidays (and, not coincidentally, have a better idea of what their year's tax bill will look like).

"I would say the trend is toward waiting to make large commitments," says McGlaughon. "Everyone I'm talking to in the nonprofit sector, as well as our private clients that I talk to here at Foundation Source, don't intend to make significant changes in their giving from last year. But they are waiting closer to the end of the year to make those gifts."

Still, another baleful trend he sees is that foundations are shrinking the pool of charities they give to, he says. "They're trying to make their dollars go further in their charitable giving strategy," he says, "by giving more dollars to fewer organizations."

According to Foundation Source's own research, smaller foundations that are $2 million to $50 million in size are giving more than they were two years ago, likely because they are more closely tied to local organizations and are seeing, up close, the greater demand for help from vulnerable people in stressed economic times. Though private foundations are required to pay out 5% of their holdings, the smaller foundations in his universe are paying 7% to 9%, he says. "They understand how stressed those local organizations are. They know the employees personally. Many times, they or their families have benefited from the services." 

Sarah Herrian, a founder of the charity Forgotten Ministries in Enid, Okla., a 501(c)(3) Christian organization that partners with churches to run clothing and blanket drives for the poor, says that her $50,000 annual budget has stayed about the same. Mainly, she says, she's up to her eyeballs in blankets and clothes from individuals. But at the same time, she hasn't seen her big donors leave the charity, she says.

"We do have people giving on a monthly basis," she says. "They commit to a certain amount. We haven't seen a lot of wavering in that giving as far as their commitment. But I know a lot of people with larger budgets are definitely seeing a difference in annual budgets." One of the make-or-break facets of a good charity she says, is its willingness to take donors out to see the people they're helping.

"That is so much more of an enticement than sending them something in the mail."

Foundation granting, however, has likely been hurt by the lower stock values of foundation assets. Matthew Chope, a partner at the Center for Financial Planning in Southfield Mich., is also a board member of the Southfield Community Foundation, which has $2 million in assets and has given away $2 million that has passed through in donations in the past three years for after school programs, battered women awareness, senior programs and scholarships. Chope says that a lot of foundations have funds that are under water and their policies limit how much they can give in that circumstance.

"A lot of the endowments were fully invested to their strategic allocation code or model for portfolios, but the portion that was in equities, probably 50%-60% for a lot of endowments probably fell by half or more," he says. "That made a lot of the pools within the endowment under water, so they couldn't give. Because a lot of the policy statements state that if you're under water from what the contributions to the endowment were or the specific donation pools were, then you can't give. You have to wait until it gets back above. And the only way it gets back above is new donations and growth in the portfolio."