new York Peter Tuchman has already checked the situation on Wall Street. “It still looks like a ghost town down here,” he says on Thursday during his tour of the New York Stock Exchange. “But that will change soon. It starts again on Tuesday. It’s still the best financial institution in the world. ”
The man with frizzy white hair is the most photographed trader on the New York Stock Exchange (Nyse) and has made a name for himself as “Einstein on Wall Street”. Tuchman has been working on the floor for 35 years and is ready to return to his old job.
The New York Stock Exchange had closed its traditional trading floor for two months. The trading room should open again on Tuesday, as Nyse boss Stacey Cunningham announced. But Cunningham warns that retailers will have to get used to a “new normal state”.
This means that only a part of them can return in the first phase – and only if they do not arrive by public transport. Masks are required on the parquet floor and strict rules on distance. The fever monitoring stations that the Nyse had already set up in early March will be retained. Anyone who has a fever is prohibited from entering.
Like the New York Stock Exchange, Wall Street is preparing for profound changes. It is slowly becoming clear how the virus will change America’s financial metropolis.
The big banks are rebuilding
Large banks are preparing their buildings so that only a fraction of the employees will work there in the future. JP Morgan Chase, America’s largest bank, assumes that the offices will be at half full for the time being. Morgan Stanley plans similarly – and everything is on a voluntary basis. “Under no circumstances will employees be forced to come back to their desks this year if they have health concerns,” CEO James Gorman said at the bank’s general meeting on Thursday.
Citigroup is considering renting additional offices in New Jersey, Westchester and Long Island outside of New York. A number of employees live there, which would save them the long commute into the city.
Other financial institutions, but also technology companies and lawyers are interested in office space outside of New York City, as brokers report. Barclays is considering letting certain employees back to the London and New York offices for a day or two, and arranging for homework the rest of the week.
The previous office layouts are not suitable for complying with the new distance rules. So conversions are necessary. JP Morgan, Morgan Stanley and many others will spread the workplaces of their employees over larger areas. This also means that bankers have to get used to not having their designated workplace.
JP Morgan had the employees’ personal belongings packed in boxes. Since only a part of the employees will work in the offices, flexibility is important. The canteens will also look different. You will have fewer seats, only offer cashless payments and instead of buffets, meals will be offered individually packaged to reduce the risk of infection.
Nyunning will initially let the rest of its employees continue to work from home, Cunningham announced. The sudden change has worked amazingly well in the heavily regulated financial sector – especially for securities dealers who have had no alternative for years to find a permanent job.
Debate on floor trading
Most took their new work environment with humor. Under the hashtag “Rona Rigs”, traders show their workstations set up at home – with several monitors, telephones and televisions. IPC, a trading technology specialist from New York, is delighted to be in high demand, including devices that connect multiple phone numbers so that multiple traders can call up information.
This again fuels the debate about whether exchanges still need floor trading at all. A study published on Thursday by the New York University and the University of Illinois in Chicago shows that the auctions at the close of trading on the Nyse were even smoother when the floor was closed. In doing so, they contradict Cunningham, who has always advocated maintaining floor trading in addition to electronic trading.
The brokerage firm Charles Schwab also noticed a similar trend at the CBOE options exchange in Chicago. It closed its trading hall on March 16 and is now planning to reopen it on June 1.
Cunningham and other advocates of floor trading say there are advantages to directing buy and sell bids to a central location and making important decisions by experienced traders. However, she must also admit that it will still be months before the parquet is fully occupied again.
The consequences of this are not yet foreseeable. And a risk remains. “We have to have realistic expectations. Our plan is designed to avoid, but not eliminate, the risk of new infections, ”said Cunningham. And if more people come back to the office, the risk of new infections increases. Wall Street is preparing for the new normal to continue for quite a while.
More: The head of the New York Stock Exchange is fighting for the trading floor.