Transcript
On the morning of September 16, 1920, a horse-drawn cart stopped near the corner of Wall and Broad Streets in Lower Manhattan. It was a busy Thursday, clerks and bankers moving in and out of the Morgan Bank building. Then, at noon, the cart exploded. Thirty-eight people were killed and more than a hundred were seriously injured. The perpetrators were never caught. Wall Street did not close. It reopened the next morning.
That resilience is the thing about Wall Street. Eight city blocks running between Broadway in the west and the East River in the east, less than two thousand feet in total length. And yet this narrow strip of Lower Manhattan has, for more than three centuries, concentrated more financial power than almost anywhere else on earth. To understand why, you have to go back to when it was not a street at all but a wall.
In the 1640s, Lower Manhattan was a Dutch colonial settlement called New Amsterdam, a trading outpost at the southern tip of an island the Dutch called Mannahatta. The colony was governed by the Dutch West India Company, and in 1653 its director general, Peter Stuyvesant, ordered a defensive barrier built along the northern edge of the settlement. He feared an overland invasion by English forces from the colonies in New England, and he wanted a perimeter.
The structure Stuyvesant ordered was not elegant. It was a palisade of wooden planks about fifteen feet tall and nearly half a mile long, reinforced with a ditch in front of it. Stuyvesant's own decree made clear who would build it: citizens, soldiers, company servants, and, in his words, "the free Negroes, no one excepted". Enslaved Africans and white colonists dug the ditch and drove the planks into the earth side by side.
The Dutch called the path running along this wall Het Cingel, meaning the Belt, the same name given to the outer barrier street of Amsterdam itself. When the English took the colony in 1664 and renamed it New York, they kept the wall and, in their tax records, began calling the street the City Wall. Governor Thomas Dongan may have been the first to formally use the name Wall Street, in 1686. The name stuck, though the wall itself did not.
By 1699 the city had grown well beyond the palisade. It had outlived its purpose, and the authorities tore it down. The stones from its bastions were carted away and used as foundations for a new city hall built at Wall and Nassau. The wall was gone, but the street it had named was only beginning.
In 1711, the city found a new use for the foot of Wall Street. On December 13th of that year, the New York City Common Council designated the corner of Wall and Pearl Streets as the city's first official slave market, a place for the sale and rental of enslaved Africans and Native Americans. A wooden structure with a roof and open sides, capable of holding around fifty people, stood there until 1762. The city's own authorities collected a tax on every transaction. The market was not incidental to Wall Street's early commercial life. It was part of the foundation.
By the late eighteenth century, a different kind of trading had taken root nearby. Merchants and speculators gathered under a buttonwood tree at the foot of Wall Street to buy and sell shares and bonds in whatever company or venture was raising money that week. The arrangement was informal, competitive, sometimes chaotic. In 1792, twenty-four traders formalised it with the Buttonwood Agreement, pledging to trade only with each other and to charge a standard commission. It was a small document. It was also the origin of the New York Stock Exchange.
In 1789, before the exchange even existed on paper, Wall Street hosted the first presidential inauguration in American history. On April 30th, George Washington took the oath of office on the balcony of Federal Hall, which stood at the corner of Wall and Nassau. The Bill of Rights was passed in the same building. The street had already become, in some sense, the place where the new republic announced itself to the world.
The early nineteenth century brought the Erie Canal, opened in 1825, which gave New York a direct inland waterway connection to the Great Lakes. No other eastern port had this. Goods and capital flooded through the city, and Wall Street absorbed the financial energy of that boom. Businesses crowded out residents. One historian noted that there were "old stories of people's houses being surrounded by the clamour of business and trade", the owners unable to get anything done. By mid-century, most residents had moved north to Midtown. The money stayed.
The Civil War, which began in 1861, accelerated New York's dominance. The war economy poured capital into northern cities, and Wall Street became, in one account, the connective tissue between "Old World capital and New World ambition". In the decades after the war, figures like J. P. Morgan, the era's most powerful banker, and John D. Rockefeller, whose Standard Oil relocated to New York, made Wall Street the undisputed centre of American industry. Between 1860 and 1920, the economy shifted from agricultural to industrial to financial, and New York led every stage.
In 1884, a financial journalist named Charles Dow began tracking a small group of stocks, mostly railroads, watching whether their average prices rose or fell over time. He started with eleven companies. When the average peaks and troughs climbed consistently, he called it a bull market. When they fell, a bear market. His method was simple arithmetic: add up the prices, divide by the number of stocks. But the resulting number gave investors something they had never had before, a single figure that described the mood of the whole market.
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In 1889, Dow's original stock report, known as "Customers' Afternoon Letter", became "The Wall Street Journal", a daily business newspaper that would grow into one of the most influential publications in the world. By October 1896, it was publishing Dow's expanded list of stocks. A century later, that list had grown to thirty companies. The Dow Jones average had become the shorthand by which the world understood whether American capitalism was, on any given day, going up or going down.
By the early twentieth century, the address of 23 Wall Street, the headquarters of J. P. Morgan and Company, was described by business writer John Brooks as "the precise centre, geographical as well as metaphorical, of financial America and even of the financial world". The building was known simply as The Corner. Nothing on the street carried more weight than that address, and nothing illustrated how completely Wall Street had moved from a Dutch colonial palisade to the engine room of global capitalism.
September 1929 was the peak. The market had climbed for years, fed by easy credit and collective optimism. On October 3rd it began to slip. By October 24th, stock values had collapsed. A renowned economist at Yale had reassured investors just days before that their money was safe. It was not. The crash of 1929 ushered in the Great Depression, in which a quarter of working Americans lost their jobs. Soup kitchens stretched around city blocks. Farms were foreclosed. Prices fell. Wall Street, which had floated the boom, now bore the name of the disaster.
During the New Deal years of the 1930s and into the 1940s, Washington clamped down on speculative credit. For a time, stocks could not be purchased on margin at all, meaning investors had to pay the full cost without borrowing. The rules eased gradually through the 1950s, each relaxation producing a small rally. The broader economy recovered through the 1960s, though the early 1970s brought turbulence in the wake of the Vietnam War.
Trading volumes climbed back. By 1967, according to Time Magazine, the exchange was handling seven and a half million shares a day, enough to cause what one reporter called a "traffic jam" of paper, with clerks working overtime to process the transactions manually. The paper was the problem: the New York Stock Exchange still required that brokerage firms cluster around Wall Street so that clerks could physically deliver paper stock certificates each week. Technology had not yet dissolved geography.
Reforms came in the mid-1970s. The Securities and Exchange Commission eliminated fixed commissions in 1973, forcing brokers to compete openly for investors. Two years later, the exchange's rule requiring most trades to occur on its own floor was scrapped, opening the door to electronic trading. In 1976, banks were allowed to buy and sell stocks. Together these changes lowered costs, opened the market to more participants, and began a slow migration away from the physical floor.
The Reagan years of the 1980s brought deregulation across the economy and a renewed appetite for risk. Money flowed. Bonuses swelled. The 1987 film "Wall Street", directed by Oliver Stone, captured the era's excess in the character of Gordon Gekko, whose phrase "greed is good" passed immediately into common use. Stone later noted with some dismay that the film had not served as a warning. Instead, it had recruited a generation of young people who wanted to become Gekko.
Then, in October 1987, the market plunged. The surrounding area lost an estimated hundred thousand jobs in the recession that followed. Telecommunications costs were falling, and suddenly firms discovered they could operate just as effectively from Midtown Manhattan, four miles north, or even from across the river in New Jersey. The NYSE itself looked at leaving. In 1998, the city struck a deal worth nine hundred million dollars to keep the exchange from relocating to Jersey City, described at the time as the largest deal in city history to prevent a corporation from leaving town.
On September 11, 2001, the World Trade Center was destroyed. The communications network that the Financial District depended on was crippled. Roughly forty-five per cent of the area's best office space was gone. The NYSE was shut. It reopened on September 17th, six days later. Trading resumed. The closing bell rang. Year-end bonuses fell by an estimated six and a half billion dollars, but the exchange itself did not close permanently, and the street did not empty.
Security transformed the neighbourhood permanently after 2001. Wall Street between Broadway and William Street was closed to through traffic. The intersection of Broad and Wall in front of the NYSE became a pedestrian square. Concrete barriers went up, and the city eventually spent between five thousand and eight thousand dollars apiece on specially designed bronze bollards, faceted sculptures whose slanted surfaces doubled as public seating. The bollards were called the Nogo. Cars could not pass. People could.
The years from 2006 to 2010 were, as one journalist put it, tumultuous. Wall Street banks had bought and packaged mortgage loans from across the country without examining them carefully, relying on credit-rating agencies that certified toxic debt as solid. When the housing market collapsed, the damage spread everywhere. In 2008, Lehman Brothers filed for bankruptcy. Bear Stearns was bought by a rival at the government's insistence. Merrill Lynch was sold to Bank of America in what one report called a shotgun wedding. The financial crisis wiped out an estimated sixty-five thousand jobs permanently.
The United States government stepped in with the Troubled Asset Relief Programme, a bailout of the banks using taxpayer money. The Federal Reserve worked weekends and holidays, allowing Wall Street firms to borrow directly from its emergency lending facility. The interventions were deeply controversial. Critics argued that the rescue saved large firms while ordinary homeowners lost everything. When reports emerged that banks were using bailout funds to pay bonuses to their own employees, the public fury was considerable and lasting.
By 2010, the firms were recovering. Bonuses returned, averaging over a hundred and twenty-four thousand dollars. A report described what one writer called a "phoenix-like resurrection" of the Financial District, with residential development, hotels, and retail filling the streets around the exchange. And yet the anger that had accumulated during the crisis had not dissipated. In September 2011, the Occupy Wall Street movement began gathering in parks and plazas around the street, protesting the concentration of wealth and the immunity, as they saw it, of the financial industry from consequence.
In October 2012, Hurricane Sandy struck. Its storm surge, the highest ever recorded locally at fourteen feet, flooded the streets of Lower Manhattan. The NYSE was closed for two consecutive weather-related days, the first such shutdown since the Blizzard of 1888. The exchange reopened two days later. The street endured.
Today the New York Stock Exchange, the largest stock exchange in the world by total market value, still stands on the corner of Broad and Wall. The Federal Reserve Bank of New York sits nearby. The seven largest Wall Street firms of the early 2000s have been reshaped by bankruptcy, merger, and scandal, but the industry they represented still accounts for roughly twenty per cent of all wages earned in New York City and a significant share of the state's tax base. The street's economic weight extends to New Jersey, where data centres now execute a substantial portion of all American securities trades.
Wall Street has always carried two meanings at once. There is the actual street, narrow and short, hemmed in by towers, still bearing the name of a defensive wall that was torn down more than three centuries ago. And there is the idea of Wall Street, which functions as a shorthand for financial power itself, for the concentrated wealth of a nation, for the gap between those who own capital and those who do not. Herman Melville understood this in 1853, when he set his story "Bartleby, the Scrivener" in a Wall Street office and called it a portrait of alienation.
What makes the street endure is not the buildings or even the exchange. It is the logic that drew traders under a buttonwood tree in 1792, the same logic that brought Peter Stuyvesant's enslaved labourers to drive planks into the earth in 1653: the logic of proximity. When decisions about money happen in one place, more money flows to that place, and the place grows harder to leave. Wall Street has been bombed, crashed, flooded, and protested. Each time, it reopened. The wall is long gone. The street it named shows no sign of following.
Image: Wikimedia Commons contributor, CC BY-SA 3.0 · AI-narrated · Drawn from Wikipedia · CC BY-SA 4.0
