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September 30, 2001

Terrorist Creates a Financial Phoenix

By Brian O'Connell

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How trading on the New York Stock Exchange and Nasdaq survived the worst terrorist attacks in American history is a lesson in the law of unintended consequences.

Osama bin Laden, who supposedly hid out in the desolate mountain regions of Afghanistan, must have thought the destruction would finally bring Wall Street to its knees.

He must not know Wall Street.

By reopening the Big Board and Nasdaq on Monday, Sept. 17 - six days after the unprecedented attacks - the financial community hung up its own open for business' sign and declared that terrorism would not interrupt business.

It wasn't business as usual, but it was business.

Thumbs Up

"We started the day with our thumbs up and we ended the day with our thumbs up," said Paul O'Neill, U.S. treasury secretary, after trading stopped.

"We wanted to put a thumb in the eye of the murderers and show them that they couldn't stop our markets today. And that's just what we did."

Traders, shaken by the previous week's events, were also pleased. "You're looking for a sense of normalcy three blocks away from the greatest act of lunacy in the history of mankind," said a somber Robert Fagenson, vice president of Van der Moolen Specialists USA, pointing to the destruction at the World Trade Center on the tip of Manhattan. "I don't know that we found normalcy but we had to focus ourselves and reopen the markets as soon as possible."

"It was," he added, "a tremendous effort on everyone's part to resume trading." None of the operations at Fagenson's firm, located several blocks from the World Trade Center, were significantly damaged.

At the Nasdaq offices in the 49th and 50th floors of One Liberty Plaza, officials had an unnerving view of the attack. Scott Peterson, a Nasdaq media communications executive, recalled seeing an American Airlines plane crash into the north tower of the World Trade Center.

Taders were apprehensive when the Big Board and Nasdaq markets re-opened on Sept. 17. "I think it's important that we opened but I also think it's important that we closed down for four days," said Paul Olsen, a two-dollar broker on the Big Board. "The attack was such a shock that we needed to regain our senses."

Olsen lives in the shadow of Ground Zero. Back to work was a brutal experience, an experience that he will never forget.

"I live in lower Manhattan so I really never got away from it. I was in a funk all week," he said. "I was not in a position to be making smart trading decisions."

Police and Firemen

Olsen says he started to feel much better on the day the markets reopened.

"It really was an event," he said. "Seeing your friends again was refreshing and seeing the police and firemen was great. We felt the whole world was watching so trading was purposeful and alert."