Lynn Martin, NYSE President, speaking on CNBC’s Squawk Box outside the World Economic Forum in Davos, Switzerland on Jan. 22, 2025.
Gerry Miller | CNBC
The great American entrepreneur Henry Ford once said, “The only real security that a man can have in this world is a reserve of knowledge, experience and ability.” In surveying the recent volatility in global financial markets from my perch as president of the New York Stock Exchange, I believe this notion remains as true today as it did 100 years ago.
After 233 years, the New York Stock Exchange remains the beating heart of the global financial system. In recent weeks, the faces of our trading floor have been seen on the front pages of newspapers from New York to Tokyo. Our real-time market data is on constant display across television news and social media.
From my conversations with investors — ranging from everyday retail traders to the world’s largest asset managers — I thoroughly understand the challenges posed by the recent market turmoil.
Separate from the ups and downs of our markets, though, Americans should feel assured by another trend from recent weeks: The infrastructure and operational practices underpinning our markets are the envy of the world and have met the challenge posed by recent volatility.
U.S. markets come from humble beginnings. The New York Stock Exchange was started in 1792 by a group of twenty-four stockbrokers who met outdoors under a buttonwood tree. That has evolved from a structure which was once dominated by people shouting “buy” or “sell” to one that today blends the best of human judgment interacting with state-of-the-art technology.
Since April 3, our designated market makers have taken manual control of the opening and closing auctions at more than two times their usual rate to mitigate the market’s extreme volatility. This flexibility, unique to our model, has fostered greater engagement from market participants, with NYSE’s opening and closing auctions growing more than 20% to handle over 32 billion dollars in trading activity per day.
We’ve also seen trades settle and clear more efficiently than the last time our systems were battle tested. Following the Covid-19 market sell-off, the exchange industry accelerated the time to settle trades from two days to one — increasing certainty and diminishing risk.
With dramatic swings in the Dow, S&P 500 and other major indices, U.S. exchanges are absorbing a record number of transactions and volume. At the New York Stock Exchange, we have struck a record volume of trades on our exchanges three times in the last seven days — peaking on April 9 with over 30 billion shares exchanged hands.
On April 7 and April 9, we processed more than 1 trillion messages in a single day, with a median processing time of around 30 microseconds. Said differently, efficient certainty of execution has never been more crucial from a risk management perspective and the ecosystem has risen to the occasion.
Amid great uncertainty, our markets have provided investors with the freedom to digest global events, make investment decisions and execute trades with unrivaled speed and accuracy.
It is no accident that our system is working. It’s a system we have built and refined over more than two centuries. We make constant, immense investments in our technology. We push our teams to innovate. We prepare for every crisis imaginable.
In moments of uncertainty like these, we are constantly guided our north star of protecting the integrity of the U.S. market infrastructure. We rely on our reserve of knowledge and our experience to ensure the market’s strength and resiliency and the collective efforts from the financial industry maintain the U.S.’s position as the largest and most robust financial market in the world.
When it comes to risk management, and what it takes to run the largest and most robust markets in the world, Henry Ford got it right.
