Page 8 - Module 1 History of wall street

The

IMPORTANCE of Wall Street

As an economic engine other financial centers were growing faster. year period dangled over $100 million in migration from Wall Street: Jersey economy.In 2009, the Wall Street financial services sector in the fallout of the
In the New York economy Another estimate (2008) was that Wall tax incentives to persuade Goldman Sachs The financial industry has been slowly employment wages were paid in the subprime mortgage crisis.
Finance professor Charles R. Geisst wrote Street provided a fourth of all personal to build a 43-story headquarters in the migrating from its historic home in the amount of almost $18.5 billion in the state.
that the exchange has become “inextricably income earned in the city, and 10% of New financial district near the destroyed World warren of streets around Wall Street to the The industry contributed $39.4 billion or 8.4 Competing financial centers
intertwined into New York’s economy”. York City’s tax revenue.The city’s securities Trade Center site.In 2009, things looked more spacious and glamorous office towers percent to the New Jersey’s gross domestic Of the street’s importance as a financial
Wall Street pay, in terms of salaries and industry, enumerating 163,400 jobs in somewhat gloomy, with one analysis by of Midtown Manhattan. Morgan Stanley, product in the same year. center, New York Times analyst Daniel Gross
bonuses and taxes, is an important part of August 2013, continues to form the largest the Boston Consulting Group suggesting J.P. Morgan Chase, Citigroup, and Bear The most significant area with Wall Street wrote:
the economy of New York City, the tri-state segment of the city’s financial sector and an that 65,000 jobs had been permanently lost Stearns have all moved north. employment is in Jersey City. In 2008, In today’s burgeoning and increasingly
metropolitan area, and the United States. In important economic engine, accounting in because of the downturn.But there were — USA Today, October 2001. the “Wall Street West” employment integrated global financial markets — a vast,
2008, after a downturn in the stock market, 2012 for 5 percent of private sector jobs in signs that Manhattan property prices were Nevertheless, a key magnet for the contributed to one third of the private neural spaghetti of wires, Web sites and
the decline meant $18 billion less in taxable New York City, 8.5 percent (US$3.8 billion) rebounding with price rises of 9% annually Wall Street remains the New York Stock sector jobs in Jersey City. Within the trading platforms — the N.Y.S.E. is clearly
income, with less money available for of the city’s tax revenue, and 22 percent of in 2010, and bonuses were being paid once Exchange. Some “old guard” firms such Financial Service cluster, there were three no longer the epicenter. Nor is New York.
“apartments, furniture, cars, clothing and the city’s total wages, including an average more, with average bonuses over $124,000 as Goldman Sachs and Merrill Lynch major sectors: more than 60 percent were The largest mutual-fund complexes are in
services”. A falloff in Wall Street’s economy salary of US$360,700. in 2010. (bought by Bank of America in 2009), have in the securities industry; 20 percent were Valley Forge, Pa., Los Angeles and Boston,
could have “wrenching effects on the local The seven largest Wall Street firms in the remained “fiercely loyal to the financial in banking; and 8 percent in insurance. while trading and money management are
and regional economies”. 2000s were Bear Stearns, JPMorgan Chase, Versus Midtown Manhattan district” location, and new ones such as Additionally, New Jersey has become the spreading globally. Since the end of the cold
Estimates vary about the number and Citigroup Incorporated, Goldman Sachs, A requirement of the New York Stock Deutsche Bank have chosen office space in main technology infrastructure to support war, vast pools of capital have been forming
quality of financial jobs in the city. One Morgan Stanley, Merrill Lynch and Lehman Exchange was that brokerage firms had to the district.So-called “face-to-face” trading the Wall Street operations. A substantial overseas, in the Swiss bank accounts of
estimate was that Wall Street firms Brothers.During the recession of 2008–10, have offices “clustered around Wall Street” between buyers and sellers remains a amount of securities traded in the United Russian oligarchs, in the Shanghai vaults of
employed close to 200,000 persons in 2008. many of these firms, including Lehman, went so clerks could deliver physical paper copies “cornerstone” of the NYSE, with a benefit of States are executed in New Jersey as the Chinese manufacturing magnates and in the
Another estimate was that in 2007, the out of business or were bought up at firesale of stock certificates each week.There were having all of a deal’s players close at hand, data centers of electronic trading in the U.S. coffers of funds controlled by governments
financial services industry which had a $70 prices by other financial firms. In 2008, some indications that midtown had been including investment bankers, lawyers, and equity market for all major stock exchanges in Singapore, Russia, Dubai, Qatar and
billion profit became 22 percent of the city’s Lehman filed for bankruptcy,Bear Stearns becoming the locus of financial services accountants. are located in North and Central Jersey. A Saudi Arabia that may amount to some $2.5
revenue.Another estimate (in 2006) was was bought by JP Morgan Chaseforced by dealings even by 1911. But as technology In 2011, the Manhattan Financial District is significant amount of securities clearing trillion. -- Daniel Gross in 2007[24]
that the financial services industry makes the U.S. government,and Merrill Lynch progressed, in the middle and later one of the largest business districts in the and settlement workforce is also in the An example is the alternative trading
up 9% of the city’s work force and 31% of was bought by Bank of America in a similar decades of the 20th century, computers United States, and second in New York City state. This includes the majority of the platform known as BATS, based in Kansas
the tax base. An additional estimate (2007) shot-gun wedding. These failures marked and telecommunications replaced paper only to Midtown in terms of dollar volume workforce of Depository Trust Company,the City, which came “out of nowhere to
from Steve Malanga of the Manhattan a catastrophic downsizing of Wall Street notifications, meaning that the close of business transacted. primary U.S. securities depository; and the gain a 9 percent share in the market for
Institute was that the securities industry as the financial industry goes through proximity requirement could be bypassed Depository Trust & Clearing Corporation,the trading United States stocks”.The firm has
accounts for 4.7 percent of the jobs in New restructuring and change. Since New in more situations.Many financial firms In the New Jersey economy parent company of National Securities computers in the U.S. state of New Jersey,
York City but 20.7 percent of its wages, and York’s financial industry provides almost found that they could move to midtown After Wall Street firms started to expand Clearing Corporation, the Fixed Income two salespersons in New York City, but the
he estimated there were 175,000 securities- one-fourth of all income produced in the Manhattan four miles awayor elsewhere westward in the 1980s to New Jersey,the Clearing Corporation and Emerging Markets remaining 33 employees work in a center in
industries jobs in New York (both Wall Street city, and accounts for 10% of the city’s and still operate effectively. For example, direct economic impacts of Wall Street Clearing Corporation. Kansas.
area and midtown) paying an average of tax revenues and 20% of the state’s, the the former investment firm of Donaldson, activities have gone beyond New York City. Having a direct tie to Wall Street
$350,000 annually.Between 1995 and 2005, downturn has had huge repercussions for Lufkin & Jenrette was described as a Wall The employment in the financial services employment is problematic for New Jersey,
the sector grew at an annual rate of about government treasuries.New York’s mayor Street firm but had its headquarters on Park industry mostly in the “back office” roles however. The state lost 7.9 percent of its
6.6% annually, a respectable rate, but that Michael Bloomberg reportedly over a four- Avenue in midtown.A report described the has become an important part of New employment base from 2007 to 2010 in the

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