Last Updated: 10:48 AM, September 10, 2011
Posted: 10:12 PM, September 9, 2011
My father, a construction worker, spent a lot of time laying iron rods in the World Trade Center’s concrete foundation back in the late 1960s. Dad was never big on the architecture of the day: He said skyscrapers like the Trade Center -- built with far less steel and concrete than earlier towers -- were ripe for disaster. “You can light that place with a match,” he once told me.
It was, of course, something much larger than a match that took the Towers down.
I was lucky that day: Though I worked downtown at The Wall Journal Journal, covering the big Wall Street firms and banks, I had a doctor’s appointment in the Village. We could all see the smoldering towers, but the closest I came to the chaos was seeing people fleeing uptown near the Astor Place subway station.
COMPLETE 9/11 ANNIVERSARY COVERAGE
It was only when I got home and heard the roar of what were probably F-16 fighters circling above StuyTown that I realized the country was at war -- and that my first assignment as a war correspondent was to cover the Wall Street rebuilding effort.
Because the terrorists didn’t just aim to shed blood and sow fear -- they wanted to kill our economy, too.
This was the era just before widespread electronic stock trading: Most orders to buy and sell were matched on the floor of the New York Stock Exchange by human traders. And even if those traders could get to work so close in the frozen zone, the wiring linking the exchange to the firms that customers traded through was housed below Ground Zero and the surrounding area.
In other words, the stock trading would have to cease for the foreseeable future. And while the US economy is far bigger than the stock market, those trades are vital to keeping it up and running -- and now it was shut down.
Then something miraculous occurred: The same Wall Street executives who fought tooth and nail over deals and wouldn’t think twice about screwing a client out of a dime did something out of character, and began acting like they were on the American team.
They shared office space; they refrained from shorting the stocks of the hardest-hit firms, like Lehman Bros, located adjacent to Ground Zero. Jimmy Cayne, who viewed every competitor as an enemy, opened Bear Stearns’ doors in Midtown for meetings on the rebuilding effort.
Vital as Mayor Rudy Giuliani was, Richard Grasso, then the head of the NYSE, was equally important in those first days downtown. He’d later be vilified for being paid exorbitant sums, but Wall Street and investors should be thankful they had him around on 9/11. Sharks like Cayne, Lehman’s Dick Fuld and Citigroup’s Sandy Weill cooperated with each other because Grasso was twisting so many arms behind the scenes.
And not just Wall Street arms: Using his vast connections to top officials in government and in corporate America, he made sure that the wiring was fixed and that his people -- the floor traders -- could get to work in relative safety.
That following Monday, the stock exchange opened, and the business of capitalism resumed. On at least one account, the terrorists had lost.
Wall Street has changed much since those days. Grasso was ousted as exchange chief over his pay package, though his reputation has fared a lot better than the rep of the guy who tried to make a crime out his pay deal, then-Attorney General Eliot Spitzer: Most people recognize he was one of Wall Street’s most effective leaders. For the first time since his 2003 ouster, Grasso returned to the NYSE as it commemorated the anniversary this week.
The big firms haven’t fared as well. Not long after 9/11, Wall Street became a boom town; the banking honchos felt they could do no wrong. Yet they did. The easy-money policy of the Federal Reserve -- which slashed interest rates after the terrorist attacks and never let up -- led to a huge bubble in financial products, including housing and investments tied to housing. On 9/11’s seventh anniversary, just about every major Wall Street firm that survived the attack was either insolvent or heading in that direction.
On its 10th anniversary, nearly all the remaining firms have now been bailed out. What a difference a decade makes.
Charles Gasparino is a Fox Business Network senior correspondent.
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