Within two seconds of the lights going out, the New York Stock Exchange sealed the building. "You could get out, but you couldn't get in," recalls Richard Rosenblatt, president of Richard A. Rosenblatt & Co., an institutional floor broker on the NYSE. "I was very impressed by the security."
When the blackout hit, Rosenblatt had just left the elevator and walked into his firm's offices on the 26th floor of an NYSE building after the 4:00 p.m. market close on Thursday.
Rosenblatt then ran down those 26 floors because his daughter was waiting to give him a lift home. Knowing that he would not be able to leave, he first had to convince the security guard to let him go outside and come back in.
Once he managed to get back in the building, Rosenblatt ran back up those same 26 floors.
Joe Gawronski, Rosenblatt's chief operating officer, says the firm continued to receive uploads from the order-management system at 3:30 p.m., 4:00 p.m. and 4:30 p.m., which were then entered into the clearing system.
He says all systems were running. "We were partly lucky, we do have redundant connectivity to electronic-trading systems and to clearing firms," says the COO.
Though Rosenblatt usually trades OTC stocks through Archipelago over a T1 line, that line was down, so the firm reached Arca via the Internet. To ensure that the Internet connection remains viable, Rosenblatt can connect via either PSI Cogent or MCI, says Gawronski.
As for clearing, Jefferies handles nearly all of Rosenblatt's customer trades, with LaBranche as a backup provider.
According to a spokeswoman, the NYSE converted to generator power at around 10:00 p.m. Thursday evening and was prepared to operate, but the exchange converted back to Con Ed power shortly after 6:00 a.m. Friday. The Big Board opened on time and operated normally throughout the day.
Friday morning, Rosenblatt arrived at the exchange at 6:40 a.m., leaving extra early to avoid traffic. As an agency broker that represents institutional orders in the auction market, Rosenblatt felt he had to come to work that day, even though the firm had four other floor brokers. "We're agents. If our clients are going to be trading stocks, we have to be here," he says. The firm had a full crew of trading and technology personnel that day.
Gawronski arrived at 7:00 a.m. and took the elevator, which was a good sign, he says. "The metal detectors were working too," he notes.
Rosenblatt says, "Then we simply called all of our clients to let them know we could provide the upstairs service for OTC stocks and we were fully operational." But the firm's long-distance service was out, so employees used regular phone lines and cell phones.
Buy-side customers were able to route orders to the firm, says Gawronski. "We use BBSS (Broker Booth Support System) on the floor and we use NYFIX upstairs, and I believe we were up and running."
Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio