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Thursday, 20 September, 2001, 08:43 GMT 09:43 UK
Back to work: What now for Wall Street?
The world's financial centre has been devastated, the stock markets are jittery, and the global air traffic system has ground to a halt.

How quickly can Wall Street recover from the attacks? Will the global economy be pushed into a recession?

Can the effort to rebuild New York be the foundation for an economic turnaround worldwide?

This debate is now closed. Read a selection of your comments below.

Your reaction

I visited Wall Street yesterday and I can assure you that the Financial District is full of life

Harry Matthews, USA
Authentic New Yorker here! I'm amazed at how little Europeans seem to know about New York. This is a city that prides itself on its ability to survive - storm, flood, fire, blackouts, war, bomb threat - been there, done that. We are so many, so diverse, so determined, that minor distractions cannot deter us. What so many outsiders perceive as rudeness and indifference is simply a concentration on survival and efficiency, not inhumanity.

I have worked for many years as a professional tour guide, and the most common observation I hear from my clients is this: "New Yorkers are much nicer than I thought. They're eager to help. They're charming. They're fun." I visited Wall Street yesterday and I can assure you that the Financial District is full of life. It will be weeks, if not months, before life returns to normal. But there's plenty of street life, shops and restaurants are re-opening, most landmarks will be open soon. Even the smoke is diminishing! New York will survive. New York will thrive. We've been doing it for three centuries.
Harry Matthews, USA

The markets always reflect the sentiments of investors also their faith in the system. I feel the later will prevail in the long run. US will spend more in infrastructure investments, also because of increased sense of insecurity insurance business will grow and in the near future we will see the markets all over the world back on track. The world then will be a better place to stay then
Prasad Jahagirdar, India

Global recession will be brought about by myopic foreign policies

Shivendra Tripathi, India
Global recession will be brought about by myopic foreign policies. The US must see this as a terrorist attack by a set of individuals who do not have any nationality except their wrong beliefs. Declaring a war and unnecessary attack on civilians could lead to polarisation and trigger of recession if the Arab world takes exception. With oil prices already going so high, it would not be very difficult to trigger a recessionary trend, and hence USA will have to be vary of this.
Shivendra Tripathi, India

Corporate America is doing its part to stabilize not only New York but the US economy as well. I pray that those who would pull out of the market realize that if we go down, we all go down together. Nothing says we will overcome like I am putting my money where my mouth is. Invest in America it is still the best bet you can make
Gregg James, USA

The recession, if it can't be fought off, will bring a good dose of reality to stock markets

Brendan Newport, UK
If a recession strikes, it won't be because of the attack on the 11th. The American economy has suffered because of an over-reliance on technology stocks; look at the way dot com firms were "pumped-up" to values way in excess of their actual worth. The feeding frenzy that was exhibited with anything Internet-related is now near an end, and it's perhaps time that Wall Street looked to more traditional manufacturing/property and mining etc. concerns in which to invest.

The recession, if it can't be fought off, will bring a good dose of reality to stock markets, and get rid of some of the dodgy firms with poor customer service and shaky financial foundations who somehow found their way onto the FTSE 100 in recent years. In Europe, huge losses have been provoked by telecoms firms investing ridiculous sums in mobile phone technology and licenses for a market as yet unproven. Remember WAP? Bluetooth? Innovation is a wonderful thing, but not if it's of no conceivable use to the consumer.
Brendan Newport, UK

I salute those idealists willing to invest their savings to try and buy their country out of recession. Unfortunately it doesn't work like that. The big speculators make their money from large movements in prices - whether they are up or down - and today, many of them became quite a bit richer. Lenin once said that if you announced that all capitalists were to be hanged, stocks in rope manufacturers would go up. Today the hypocrites on Wall Street proved him right.
Chazza, Scotland

The markets are sometimes reactive to bad news, and the worse the news the more reactive. If that were to occur that would play into the hands of terrorism and further any terrorist plan as to causing wider economic and social disruption. Fear that the markets and people's economic lives might be impacted remains fear, and would be another success for terrorism which always thrives on the basis of inducing greater fear.

So we might hope for calm prudence on the part of investors, and that rash reactions will not happen. In that manner Wall Street and other world markets, trading stocks, bonds and commodities, can themselves share in fighting terrorism rather than submitting to terrorism and becoming terrorists, in the economic sense, themselves, even if that latter unwittingly. Anything that serves to minimize and reduce economic impact and upheaval, for the largest possible numbers of people, serves to combat terrorism.
Robert Morpheal, Canada

To assume that increasing the production of goods will somehow "jump-start" the economy is to make the same drastic error made in the 1920's, when production surpluses vastly outstripped buyer capacity to purchase. The statement about Americans (and Europeans) buying on credit is quite telling. I hear no one talking about a truly GLOBAL economy, but rather...always...the "haves"-vs-"the have-nots". It is a case of "The Emperor's New Clothes!" Our actual liquid assets are dismal, but we still continue to buy, buy, buy!

I find it somewhat sad that at my part-time bookseller/music seller job, the trade in "patriotic" tunes was up 100 fold this weekend. Yet, I agree that that the buying must continue so as not to precipitate the inevitable fall. As a harbinger, the travel industry is thus far devastated in the U.S., with both involved airlines laying-off thousands already.
Theresa Martinez, Colorado, USA

The greater the tension, the less the consumption; the less the consumption, the lower the market. Although I see strong futures ahead for flag makers, whichever publisher gets a book out first and CNN.
Michael Shiel, Cardiff, Wales

The main difference between today and one week ago is that now Bush has an excuse for a bad stock market. Greenspan's "irrational exuberance" slogan, among other things, turned the market lower, and little that he does now seems likely to move it higher.
David Hulme, USA

Let's face it, even in the pits of recession, we in the western world are better off than all of our counterparts in the eastern world. It is this attitude of only worrying about ourselves, and our fiscal health, that leads others to hate us. Indeed, some of us in this country are starting to hate ourselves too. This tragedy should be a point for us to ease off on our greed and start to help the world a bit. After all, we are all human and need essentially the same things. Let's stop the rhetoric and learn from what has gone before. We know that not only do "victors" of war suffer, "losers" can become stronger. What we need is understanding and temerity. Greater bravery than those in WWII, for a greater peacetime. We stand on the brink, I urge us all to not follow over.
Jonathan Urquhart, Scotland

Apart from buying shares, there is another quick way to prevent recession - hop on a plane in the US of A. Show the terrorists they cannot scare US citizens off their planes, prevent thousands of people losing their jobs, reduce the level of falling share prices- just by buying an air ticket!
Andrew, UK

If everyone sells off their stock in the US and it damages the economy then the terrorists will have won. Not only is a strike on the NY Stock exchange effecting the US, it is also having an effect on the rest of the world markets. It is a shame that a strike on one financial centre could generate this much chaos in the market place, as well as being aided by media reports on an impending recession.
Llewellyn Vaughan, United Kingdom

It is a gross misunderstanding of the Stock Market to think that 'buying' can be patriotic. The market is a cold slick money machine - not a Telethon.
Matt, UK

The markets will recover quickly but people will remember for a very long time

Chris Jones, UK
Buy BAE, sell BA. What's in a name. The markets will recover quickly but people will remember for a very long time.
Chris Jones, UK

I am buying today!!!
Roger Gain, USA

I'm a little concerned that some contributors are assuming that patriotism requires suspending one's normal critical approach to assessing the value of the stock market. Supporting America in its travails, admiring Wall Street workers getting back to their jobs, and supporting likely military retaliation against terrorists and the states that harbour them are all separate questions from whether the stock market accurately discounts the net present value of its constituent companies' future earnings.
Oliver Kamm, UK

As you can tell from my e mail address I work for a US investment bank in London.

We will carry on doing our jobs, the building will be rebuilt

Solomon Drury, UK
Although the shock and great sadness has affected us all here, we have worked hard so that disruption is kept to a minimum. Wall Street will carry on, latest reports from the exchanges say on Monday. We will carry on doing our jobs, the building will be rebuilt. The terrorists will not stop the onward march of capitalism. It has only hurt people...
Solomon Drury, UK

Putting the USA on a war footing will accelerate the whole economy, especially the "troubled" High Technology stocks. It no longer matters whether or not Greenspan has lost his touch.
David de Vere Webb, England

The first priority of Wall Street companies who have experienced devastating loss of life will not be back to business as usual. It will be to take care of the families of their employees. And that is as it should be.
A.Bradley, USA

Because of these terrorist attacks we should not let down the Economy, the back bone of our free life

Narendra Singh, USA
If consumer confidence is the key to hold recession back then there is very good chance that world economy would keep itself out of recession phase. After the attack on WTC the patriotism is touching its new dimension. People from most part of the democratic world are in clear mood to maintain the spending as it is now.

In my view, because of these terrorist attacks we should not let down the Economy the back bone of our free life. If it happens, It would be a symbolic win for the terrorists and They must not be a winner in any form.
Narendra Singh, USA

Markets always fluctuate. The usual autumn fall of the stock indices in the next few weeks may be somewhat accentuated because of this week's incidents in the USA but S&P500 and FTSE 100 may be expected to bounce back, say, some 20 percent from their nadir, by the new year.

To pin the blame for the long-awaited recession on those responsible for the demolition of the World Trade Centre is, however, rather disingenuous.
Mohansingh, India

We have scraped up all available cash to buy stock in American Companies when the stock market re-opens Monday

Dr. Kathryn Presley, USA
My husband and I, retired educators, scraped up all available cash and gave it to our financial advisor to buy stock in American Companies when the stock market re-opens Monday. This is our small gesture to show support and faith in our system.
Dr. Kathryn Presley, USA

In case of military vengeance, there will be a deeper recession than normally expected before the attack. Who wants to invest in a period of uncertainty, specially when it is clear that this uncertainty will be universal and the period will take years.
Pieter van Herpe, Belgium

If anyone thinks that destroying two buildings in New York is going to trigger a depression, they need their head looking at.

The US is not in recession, and I've already heard that companies that supply large servers to Wall Street are ramping up production to replace the machines destroyed in the attack.

Meanwhile, producing the extra supplies needed for whatever military actions are taken will give a further stimulus. I've read doom and gloom predictions and ranting about the so-called service economy for the past ten years solid. Why does the predicted catastrophe never actually happen?

Jon Livesey, USA

No, recession is already here

Brian C. Dobson, New Zealand
No, recession is already here. The gross mistakes made by the regulators and politicians cannot be repaired. This event may delay the inevitable slightly but in the end it will be worse.
Brian C. Dobson, New Zealand

On Wall Street awakening on Monday - I do believe that we will see US investors sending a message showing our country's strength. We are not in fear... "we live in the home of the brave" and I expect that will be evident.
Daniel Karvonen, USA

I think New York will find its feet again even though, regrettably, not having the sight of the two towers as its symbol of economic might. Perhaps it is about time a think-tank is created to restructure the basis of the western economy in such manner as to address the rich-poor divide and create various other categories which avant-garde economists have been recently thinking about. The president of the World Bank expounded these thoughts clearly on BBC World today. There are, after all, many facets to historical events and it would be stubborn for us not to learn from history. Athena.
Athena, Malta

Re: Michael Thomas comment. There is a point where any further reduction in Interest rates is going to be self defeating. The government could make many feel poor as their income from savings is substantially reduced. We should learn from Japan, where interest rates have been reduced. A businessman does not mind paying double the interest rates if he can earn money from his investment.
Sikander, London

Buy, Buy, Buy!

In conversing with friends worldwide I think we are going to rally

Alexander Miller, Scotland, UK
The day we let our confidence drop is the day we let them win.

Don't sell anything. Nothing's changed except we've got a little job to do. In conversing with friends worldwide I think we are going to rally. We are going to give them something to talk about.
Alexander Miller, Scotland, UK

In order to avoid a deep recession my only advice to Americans is to show their patriotism by buying American services and products, even if they lack all the bells and whistles. In this way, they will help their economy, ease their unemployment, help reduce their trade deficit and - above all- help in their country's war effort in the years ahead. The rest of the world can show its solidarity with the Americans by deciding to buy at least one product next Christmas that has the label: "Made in the USA".
S. Suri, Finland

The first priority of Wall Street companies who have experienced devastating loss of life will not be back to business as usual. It will be to take care of the families of their employees. And that is as it should be.
A.Bradley, USA

There has been much talk over the past few days about standing up to the terrorists and the democratic countries uniting against a common enemy in terms of defence.

Unless people have faith in the markets they will collapse

James Flanagan, UK
The same must apply in the world of Business - unless people have faith in the markets they will collapse otherwise there is a danger the terrorists will win and the free world economy will be left in ruins alongside the World Trade Centre.
James Flanagan, UK

Do I think that the rebuilding of NY will help the global economy? Yes, eventually, but the rebuilding will take years, whereas the global economy is going to hell in handbasket at internet speed.

The Japanese economy (the world second largest) is a basket case, and the US economy, (the world's largest) relies on foreign direct investment to the tune of $30bn a month to sustain it's current account deficit, this relies on a strong dollar, (currently going south as I speak) and reckless consumer spending, (currently Americans spend 33% more than they earn, financed by credit card debt).

If consumer spending falls off a cliff so will the US (and world) economies, and then recession is a certainty. Unless of course we all get out there and spend our way out of recession, and with the UK jobless figure dropping to the lowest since 1975 that may yet happen.
John Barry, Brit living in Germany

Recessions are normal and happen roughly every ten years on a cyclical basis

Patrick Vance, England
Recessions are normal and happen roughly every ten years on a cyclical basis. The governments cannot help this as investor confidence is a very sensitive and area. This tragic event has merely expedited the inevitable - a global catalyst. However, there will be boom times again.

I'm confident that the US will come back much stronger in the middle of this decade, but not before - ditto for the UK, Japan et al
Patrick Vance, England

The markets will recover but I'm not sure that Wall St (or the City of London) as physical entities will last much longer. With today's technology office workers do not need to be packed together in city centres.

Spreading offices around the regions could do a lot to ease the everyday problems of commuting and overpriced property. In addition it would make it far more difficult to damage everything in one go as has been done on this occasion.

This could provide the spur to overcome the inertia of doing things the traditional way.
B Essada, UK

There are two answers to any threat of forthcoming recession - trade liberalisation (reducing tariffs and policies which hamper employment) and tax-cuts.

Both of these stimulate spending and capital flows, which are the lifeblood of developed economies. Stagnation is the last thing we can afford to allow now.
Pete Morgan-Lucas, Wiltshire, UK

Be strong, be courageous and don't start selling everything

Gerry, Scotland
Now is the time for the money men to show that they are true patriots and not just parasites that live off others. Be strong, be courageous and don't start selling everything and bring on recession.
Gerry, Scotland

We are on the brink of the largest recession for the past 60 years. The market has dropped for the past two years, although it may recover through the normal cycle.

The catastrophe of this week, linked with the globalisation of the economy, may tip us over the balance.

So what do we do? For those who remember the Wall Street Crash & the Great Depression of the 30's - there was a solution. It started in September 1939 in Britain and forced companies into production and brought employment.

We have moved so far into a service-based economy that we have little industry left. If our services move (a simple task) - we have no economic base - politicians of the last 20 years (yes you; Tony, John & Margaret - all of you are to blame) sold it and shut it down.

We are left with nowhere to hide - welcome to Britain, 3rd world country of the 21st century.
David Lane, Leeds, England

David Lane really is talking off the top of his head. The remedy to this terrible situation we find ourselves in is the liquidity of the banking sector. If interest rates can be kept low and cut further this will help to maintain confidence in the economy.
Michael Thomas, London, UK

I don't believe that another recession will hit quite with the effect people are predicting

Tim Chapman, Worksop, England
I agree with Michael Thomas. David Lane is talking off the top of his head. One of the great causes of recession is people talking about recession; namely "Consumer Confidence".

Actually, I don't believe that another recession will hit quite with the effect people are predicting. If military action is to be taken, America, and NATO allies will indeed have to spend money - and a lot of it - on defence; and even if the US did not take military action; their defence budget will certainly be a lot larger now.
Tim Chapman, Worksop, England

See also:

14 Sep 01 | Business
US markets to re-open on Monday
13 Sep 01 | Business
Disaster planning saves Wall Street
13 Sep 01 | Business
Has economic crisis been avoided?
13 Sep 01 | Business
Will US consumer confidence fade?

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