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CNN Live At Daybreak

America's New War: What to Expect From Markets

Aired September 17, 2001 - 07:03   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA ZAHN, CNN ANCHOR: Right now I'm going to catch up with Lou Dobbs, who will also join us consistently throughout the morning from the New York Stock Exchange -- and Lou, if you could, give us a preview of what investors might expect later on this morning.

LOU DOBBS, CNN CORRESPONDENT: Paula, good morning. Investors don't really know what to expect and the traders, who will be people in this floor at the New York Stock Exchange, opened today after being closed for four straight sessions -- and by the way, that hasn't happened since the Great Depression -- people here are anxious. They are not particularly upset in any way, but they are anxious to see what the market will do, what investors ultimately will vote on with their dollars and with their stock purchases and sales.

The stock exchange has gone to heroic lengths to open at all and the fact of the matter is that they are remarkably well prepared. This floor is typically -- and I'm between the trading post where the specialists work and move stocks -- 10 and 11. Normally, there would be no one on this floor until usually about nine o'clock in the morning. We've been here since about 6:30 this morning when the Treasury Secretary, Paul O'Neill, arrived to meet with Dick Grasso, the chairman of the New York exchange.

So the participation, the preparation all in place and it's, and some, some anxiety, as well.

ZAHN: So, Lou, I know you are immersed in all the details of this, but for those of us who see that overseas markets have sounded an initial alarm and the Nikkei Index hit an 18 year low this morning, how are we supposed to react to that news?

DOBBS: I think that we have to react to it today the same way we would on any other day and as a matter of fact, that's one of the points that most of the heads of the major brokerages, Dick Grasso, the chairman, has said. This is not a place for heroics. This is not a place in which to look at anything other than this marketplace in a long-term manner, which is what investors should be doing on any day.

Warren Buffett, on "60 Minutes" last night, made what I thought was a great point. Federally this economy is not appreciably different than it was a week ago and a CNN poll conducted yesterday shows that actually investor and consumer confidence is actually higher today than before the bombing. The fact that the Nikkei average fell five percent and is at almost an 18 year low is really more indicative of what is happening with those markets than with this one. This market, the largest in the world, it is so important, so critical that this market be open, dwarfing, as it does, Tokyo, London, Frankfurt, all of the other world markets, those major markets combined, with some $13 trillion in market cap here.

ZAHN: All right, Lou, you mentioned those consumer confidence numbers and yet there appears to be a very strong networking campaign bringing together folks that normally are trying to compete with each other to prevent a sell-off today. Can you describe to us exactly what they're doing to prevent a sell-off?

DOBBS: Well, Paula, as you say, there are an interesting group of people who've come together, just as all American -- all the American people have come together in this time of crisis. But this crisis here on Wall Street will bring together the head of the SEC, the treasury secretary. In fact a competing exchange, the Nasdaq, the CEO of the Nasdaq, Rick Simmons, will be up on the balcony for the opening bell.

They represent the diverse interests that are making certain that these markets are orderly. They cannot nor would they want to -- Dick Grasso, the chairman of the exchange, has made it clear. If people want to sell they're going to sell and this is a market and it's a free market and that's precisely what has to be preserved here.

But they are working together with the Fed, the Treasury, with the clearinghouses and all of the firms, the brokerage firms and specialists here on the floor to make certain that whatever investors want to do is carried out, traded in an orderly manner. And that's the most important thing that we'll see today irrespective of whether there is volatility or a market that sells off or trades high -- Paula.

ZAHN: All right, Lou. We look forward to talking to you all morning long.

I wanted the point out that you will be joining us at the opening of the exchange and filing reports throughout the day.

Thanks, Lou.

DOBBS: Thank you.

ZAHN: And Lou mentioned the chairman of the stock exchange, the New York Stock Exchange, Dick Grasso. He will be our guest in the next hour and we hope to ask him some questions that some of you may have on your minds this morning.

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