We Are Wall Street

Big ideas often come to grief because of small details. The Germans and Americans have just forged the largest stock exchange in history, and what is the financial branch talking about? What to name this new giant.

A minor detail? It is not that simple. In the supposedly objective world of finance, feelings play a large part. Rise and fall, wealth and bankruptcy, no other institution embodies this combination of cool heads and passionate hearts like Wall Street.The New York Stock Exchange is the cradle of capitalism. It is the symbol of America’s economic power. And now it is going to become German — at least a little.

Many Americans fear they will lose out in the fusion of the German and New York exchanges. After all, the Europeans will form the majority in this future financial giant. Or, to put it more simply: We are now Wall Street, too.

Outrage in Manhattan! Newt Gingrich sees the merger as a clear sign of America’s decline. Of course, it is obvious that the Republican politician, who made Bill Clinton’s life so difficult, is mainly looking to attack President Obama. But his remarks go beyond mere political rhetoric. They touch a national nerve.

At the same time, the trans-Atlantic stock exchange marriage — seen soberly — is a rational step. The liberalization of trading has increased competition. Investors are no longer impressed by big names. They want to be able to act as quickly as possible, as securely as possible and as cheaply as possible.

New, privately organized exchanges are taking market share away from the old guard. Profit margins are shrinking, and developing new computer models is expensive. Pressure to reduce overhead costs is increasing. New York and Frankfurt expect their marriage to save 300 million euros. Globally, other exchanges are planning similar moves. London and Toronto just recently announced their intention to merge.

New York’s acceptance of Frankfurt’s proposal is a success for the German exchange. Even if sheer size alone does not guarantee survival, one thing is certain since yesterday – Frankfurt will not be swallowed up. It is not abandoning the battlefield to others. After many a false start, it is poised for a leap to world leadership.

The music plays on in the German financial orchestra. And the Americans will soon get used to their role as supposed junior partner — secure in the knowledge that Wall Street will continue to play first chair violin. The only problem left is that name business. A minor detail.