C of C President Warns Against Premature Opening of Markets
U.S. Chamber of Commerce President Thomas Donohue last week warned against re-opening the stock exchanges on New York City's Wall Street before the damaged electricity and telephone grids have been repaired.
"No one understands the importance of the stock market more than American businesses, but re-opening it right is more important than re-opening it fast," he said. "Until rescue teams give the go-ahead and telephone and electric system reliability is restored, any opening bell would be premature. It is important that we do whatever is necessary to ensure a smooth re-start to the U.S. stock markets, and not make decisions based on the clock or the calendar."
If the markets re-open before the stability of the electricity and telephone systems is assured, a Chamber spokesman said it is concerned that "any small glitch" that may occur (power or phone failure) will be interpreted by investors as a "weakness" in the markets. "We're not confident that re-opening the market now is a wise decision." He noted that top Chamber officials have been in "daily discussions" with the White House, Capitol Hill and other government leaders about when to safely re-start the markets.
The latest information from New York City indicates that a "significant portion" of lower Manhattan's communications grid remains down and that electric service to the area has not been completely restored, according to the Chamber of Commerce. Both systems are integral parts of the stock exchanges and must be fully functional before the markets are re-opened, it said.
It was estimated last week that as many as 12,000 customers of Consolidated Edison of New York were without electric power. The utility reported that there was significant damage to three power substations and transmission cables in lower Manhattan, which includes Wall Street.
The telephone and electricity infrastructures were impaired last Tuesday when terrorists plowed airplanes into the twin towers of the World Trade Center, causing untold destruction and loss of life. The New York Stock Exchange (NYSE), the New York Mercantile Exchange (Nymex) and other exchanges were closed for an unprecedented four days last week as a result. The NYSE is scheduled to open today. On Friday afternoon, Nymex encountered some technical difficulties as it began to offer trading of its major futures contracts on a limited basis on the Internet.
The Chamber of Commerce represents more than three million businesses and trade associations.
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