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Wall Street: A Visit to the Financial Center of the World

The New York Stock Exchange (NYSE) is located at 11 Wall Street, New York, NY in lower Manhattan.  This area, for obvious reasons, is known as the financial district.  Historically, it is a crossing for our Federal Government and the financial markets.  Today, although some activities are still conducted here, the vast majority of the transactions and interactions take place online and a physical presence on Wall Street is not as important as it used to be.  Today more than $21 trillion worth of stocks are based out of this building.

A wall, yes that is why it is called Wall St, once stood directly in the middle of Wall Street.  The wall kept the natives away and allowed European businessman to trade in lumber and firs without fear of attack.  In the picture below, you see those rectangles in the middle of the street? This is where the original posts once stood.  Though it was considered a wall at the time, we would call is a fence today.

The Structures

JP Morgan has a a building there that still bears scars from a little-known terrorist attack that occurred in 1920; more on that soon.  At 40 Wall Street stands what was once the world’s tallest building but was soon over taken by the Chrysler building and then fell in the rankings again after the Empire State building’s completion.  It was originally built to be the headquarters for The Manhattan Company, which eventually merged into Chase Manhattan Bank.  Today, that building is known as the Trump Building, not to be confused with Trump Tower in mid-town that contains President Trump’s residence.

Trinity Church is actually the third structure to stand on this site and be called Trinity Church.  The first was the church of England and faced toward the Hudson River.  The second structure faced Wall St. and was standing during the foundation of our nation.  Washington, Jefferson and Hamilton were regular worshipers,  Alexander Hamilton is actually buried on the property, I’ve included a photo. The current structure is the third, it was built to replace the second after damage from a massive snow storm.

Hamilton was a strong influence on our financial system from the founding until his death.  If it wasn’t for him, every state would likely have its own currency.  Hamilton believed in a strong central financial system while many others thought it was best to leave it to each state.  Hamilton got his way.  Today some powers belong to the Federal government while other are left to each state to decide.  The decisions of who got what were hashed out on Wall St between the Federal Hall and Trinity Church.

Government & Finance

The Federal Government has the Federal Hall there, too.  Adorned with a statue of George Washington, this historical building is now a museum for all to enjoy.  It was the Federal Government’s first capital, where President George Washington was as they tallied the votes from our first election.  President Washington was inaugurated in this building.  The first congress met here and hashed out the constitution with Ben Franklin and Thomas Jefferson, to name a couple.  The Bill of rights was written in this building.  Today there is still a strong relationship between our federal government and the financial sector, not too surprising to see that they built buildings next to each other at the foundation of our nation.

The Market & Tour

Today, most transactions take place online and the trading floor is restricted to employees only.  Still, the work done here does support the financial markets around the world.  The NYSE is the largest stock exchange in the world.  From the original fir traders that pre-date the United States, there has always been trading happening here.  The markets are connecting buyers to sellers and allowing transactions to take place.  The now defunct Leeman Brothers had a building here across from the cotton exchange.  We know them as a the 100+ year old financial institution that went bankrupt during the great recession.  However, they had humble beginnings trading cotton and turning a profit.

The tour we took was called The Wall Street Experience.  We took the “insiders” tour.  The tour was scheduled to last an hour and 15 minutes, but lasted about an hour more than that.  The guide was very knowledgeable but was hard to hear especially with all the construction going on around us.  He did drone on about some of his personal experiences for a long time.  Most had little relevance and seemed to detract from the overall experience.  We did learn a lot when we were able to hear and did enjoy the tour overall.  I would not do it again, but as a one time experience it was worth the $35 price tag per person.  Here is a link to their website if you have plans to travel to NYC.

The Attack

On September 16, 1920 a horse and buggy was abandoned just before noon on Wall St. between Broad and Williams.  As the bells in Trinity Church toned at noon signaling a lunch break for many, the buggy exploded.  100 pounds of dynamite propelled 500 pounds of window weights through the air of the busy street.

The explosion killed 38 people and damaged the surrounding buildings.  JP Morgan’s building still bares the scars, I’ve included a photo where you can still see where chunks of concrete are missing from the wall.  The Federal Hall and the building currently known as the Trump Building  were also damaged. Miraculously, the statue of George Washington was untouched.

The case has never been solved, although the authorities and historians mostly agree that it was carried out by Italian Anarchists.  Attorney General Mitchell Palmer pushed to deport virtually all Italians from the country in years prior to the bombing.  He used the tragedy as an example of why they should be deporting more Italians.  After several months without a conviction or another attack, the public grew weary of the rounding up of Italians and the practice ended.  AG Palmer faded from public image not long after many considered him a strong candidate for President.

The Result

The 38 victims were mostly under 30 years old.  Although powerful men from the government and banking industry were likely the target, the victims instead were messengers, stenographers, clerks, and brokers.  The victims were everyday people who put in a hard day’s work and provided for their families.  The bombing was the last gasp of a dying militia instead of the call to arms they sought.  It also ended the practice of rounding up and deporting people based on their race and political ideology.  This bombing happened nearly 100 years ago and has never been solved.

“Those who do not learn from the past are doomed to repeat it.”
-George Santayana

The Original Ticker

On a lighter note, it was incredible to see how technology has changed the way information is conveyed and the market works.  These days when you want a current stock quote you can check any number of websites that will happily share the information for free.  I use Yahoo! Finance a lot but Google, FOX, and CNBC offer similar services.

The Ticker Tape machine was a radical new invention.  Patented and produce by the Edison Manufacturing Company, the machine used telegraph technology to transmit stock information to offices around the city and eventually around the world.  The picture I included is of one I saw at the NYC Museum.  This link will take you to a video of one being operated in modern day.  There is no information being sent to these machines so the text is gibberish but you can see how it works.  The operating starts around minute 3 if you don’t want to nerd out too much.

Final Thoughts

It’s good to see how things started because it helps to better understand where things are going.  At Wall Street’s foundation, powerful entities centralized power with physical locations.  Governments and the financial markets were, and still are in many ways, directly tied together.  Today, we have decentralized cryptocurrencies, which was not backed by any government, and exists without any regulation in many cases.  The landscape is changing but it has never not been changing, either.  If you are in NYC, stop by and see the exchange and other sites. You won’t regret it.

 

Thanks for reading and happy trading!

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