Evolution of the NYSE / the “Equification” of the Capital Markets
1903 | NYSE MOVES INTO NEW BUILDING AT 18 BROAD STREET More than a century after 24 brokers and merchants signed the Buttonwood Agreement, which led to creation of the NYSE, the exchange moved into 18 Broad Street. The main façade of the building features six imposing, Corinthian columns and a pediment titled “Integrity Protecting the Works of Man.” At the center, Integrity wears the winged cap of Mercury, the Roman god of commerce, and is flanked by figures representing mining, agriculture and industry.
1918 | PNEUMATIC TUBES SPEED TRADES New pneumatic tubes allowed floor brokers to send order slips to clerks quickly. The system contained six miles of tubes and almost 250 miles of wiring. Capsules carrying buy and sell orders and other information traveled through tubes connecting broker booths and trading posts. Old tubes recently were found during construction. Capsules inside the tubes contained stock-market orders.
1981 | TECHNOLOGICAL TRANSFORMATION WRAPS THE TRADING FLOOR IN METAL FRAME A nearly two-year renovation of the trading floor fully brought the NYSE into the 20th century. A key change was the addition of a huge metal frame, which was needed to hold up the weight of the floor and support all the new wiring and technology that came with the upgrade.
1995 | ANOTHER TECHNOLOGY UPGRADE: HANDHELD TERMINALS The NYSE launched an ambitious campaign in 1995 to modernize its trading floors. Large-scale installations of flat-screen panels, handheld terminals and fiber optics transformed the NYSE into a technology-powered commerce hub with the fastest operations available.
2006 | FAREWELL TO THE OLD SCHOOL: SEATS TO SHARES After converting members’ “seats” into shares the year before, the NYSE began trading as a public company in 2006. John Thain, the company’s chief executive at the time, says his biggest challenge was changing the culture and convincing seat-holders to let him turn the NYSE into a listed corporation. Before long, the Stock Exchange Luncheon Club, started in 1898, and basement barbershop where a man nicknamed “Jerry the Barber” worked for 43 years were both gone.
2013 | AN OUTSIDER BUYS THE BIG BOARD On Nov. 13, 2013, electronic commodities- and derivatives-exchange operator Intercontinental Exchange completed its $8.2 billion acquisition of NYSE Euronext. Jeffrey Sprecher, ICE’s chairman and CEO, called the deal “a game-changing transaction.”
2016 | VILLANOVA VISITS THE BIG BOARD
On April 15, 2016 – 2016 NCAA Men’s Basketball Champion Villanova University lead by Head Coach Jay Wright visit the trading floor of the NYSE.
The impact of Dodd-Frank Legislation resulted in placing once off-balance sheet products such as SWAPs on balance sheet, the legislation served as a catalyst driving efforts to simplify and consolidate business models. NYSE Transaction execution costs declined as the NYSE employed more technology to increase transaction execution volume. Today – the same process is playing out across Capital Markets across Fixed Income, Commodities, Fx and OTC Derivatives.
With the passage of Dodd-Frank in 2010, the same process of leveraging technology to reduce transaction costs while increasing transaction volumes as observed on the NYSE referred to as “Equification” began in earnest across the Capital Markets of Fixed Income, Commodities, FX and OTC Derivatives.
The “Big Four” are the largest international professional services networks, offering audit, assurance, tax, consulting, advisory, corporate finance, and legal service. The Big Four handle the vast majority of audits for publicly traded companies as well as many private companies, creating an oligopoly in auditing large companies. It has been reported that the “Big Four” audit 99% of the companies in the FTSE 100, and 96% of the companies in the FTSE 250 Index, an index of the leading mid-cap listing companies.
The “Big Three” refers to the name colloquially given to the world’s three largest strategy consulting firms by revenue. These three firms have stood out from other competitors, and have consolidated as the top-tier of management consulting business
The Rate Structure of Top-tier Consultancies are considered among the most expensive and remain vulnerable to rate / margin compression as Wall Street / Global Financial Services continue to dis-intermediate in response to Industry transaction margin erosion / compression.
At Patriot Solutions, we have aligned our operating model / consulting model to today’s Regulatory Paradigm to acknowledge and reflect the rapidly changing and cost efficient marketplace. We seek to expand and improve our global financial service’s client business by executing and delivering successful client engagements that leverage our specific core expertise areas of Risk Management, Regulatory, Compliance, and Litigation support.
Our niche boutique Consulting firm is supported by Industry expertise that aligns with our clients professional consulting needs to ensure successful project implementation, execution and delivery. As a niche Consulting boutique, we are often able to deliver appropriate Capital Markets resources with commensurate expertise at more competitive prices.