NYSE Set to Reopen After Longest Weather Related Shutdown in Over 100 Years
By Shepard Ambellas
October 30, 2012
LOWER MANHATTAN — The New York Stock Exchange (NYSE) is set to reopen Wednesday morning from what will be the longest weather related shutdown in more than 100 years.
Sandbags still line the waterlogged entrance as workers remain optimistic in hopes of the reopening after being closed for two consecutive days.
The NYSE is currently running on backup power systems and officials have stated they will try their best to keep it going all week if need be, causing concern for some.
Areas of Lower Manhattan were hit with seas surges from the storm reported at 13 plus feet causing treacherous and almost unworkable conditions for NYSE repairmen and traders.
The New York Times reported;
As the markets prepared to go back online, exchange officials and regulators braced for technical problems. The Securities and Exchange Commission spent much of Tuesday walking the exchanges through checklists that aim to detect potential mishaps.
“Right now there are a lot of connectivity problems,” Larry Leibowitz, the chief operating officer of the NYSE Euronext, said Tuesday.
Some trading firms with damaged data centers, he said, encountered problems connecting to the Big Board’s systems. One nearby building that houses several firms, Mr. Leibowitz said, sustained significant damage that could hamper their ability to operate.
The industry is operating in relatively new territory.
The last time the New York Stock Exchange closed for two consecutive days for weather-related reasons was 1888. After 9/11, the Big Board closed for four days.
Regulators require financial firms to have detailed backup plans to deal with large disruptions like storms and terrorist attacks. Some market observers have been critical of the decision to close the stock markets, saying it shows these contingency plans failed.
Despite the financial concerns of American’s and others New York City itself is still in shambles from weather related damage.
Shelves at stores remain bare as vendors await supply lines to reopen citywide.
As of now airports and other modes of transportation are still closed.
According to some the storm alone will cause the economy to slow, while others claim it will boom.
An except from Bloomberg reads, “The storm may cut economic output by $25 billion in the fourth quarter, according to Gregory Daco, a U.S. economist at IHS Global Insight in Lexington, Massachusetts. He said that could reduce the fourth quarter pace of growth to between 1 percent and 1.5 percent, from the firm’s earlier estimate of 1.6 percent.”
JG Vibes recently wrote for theintelhub.com;
In the midst of a storm that has the whole east coast torn apart, a mainstream economics professor and Columnist took the opportunity to provide the world with a perfect example of “the broken window fallacy”.
In his new article “The Economic Impact of Hurricane Sandy … Not All Bad News“, Professor Peter Morici puts forward the idea that the clean up following Hurricane Sandy will stimulate economic growth, and thus be good for the economy.
Unfortunately, it seems that the the broken window fallacy is missing from Mr. Morici’s mainstream economics curriculum.
“The broken window fallacy” is used to debunk the popular but false argument that the destruction of property stimulates economic growth by creating messes that people will eventually be paid to clean up.
This is one of the arguments that we typically hear to defend war. People say that war is good for the economy because it creates jobs.
Whatever the case the NYSE has a big day on their hands in the morning picking up all the pieces. Hopefully trading will resume to an all normal level.