Stock Market Plunge After September 11, 2001

The 9-11 terrorist attack had a profound impact on the economy of NY City, Washington DC and the nation. Labor markets, financial markets, transportation and small businesses were dramatically affected.

According to the Report to Congress on Economic Effects of 9/11 published in 2002, "The 9/11 attack dislocated, disrupted and destroyed nearly 18,000 businesses in and around WTC...Economic disruption quickly spread to countless firms across the U.S." In attacks of this magnitude small businesses are more vulnerable.

A June 2004 study by the Bureau of Labor Statistics highlighted the productivity loss in New York City. "Within the city, the attack resulted in about 430,000 loss job months and loss in wages of $ 2.8 billion. These lost job months were equivalent to approximately 143,000 jobs each month, for three months. The effect of 9/11 was centered on city's 'export' economy, which represented 68 percent of all lost job months and 86 percent of all lost wages."

A study conducted by the New York Foundation of the Arts found that of the 150,000 artists and entertainers in the NY City 22% respondents became unemployed; 66% lost sales/income; 69% lost business opportunities/independent contractor jobs.

Immediately after 9/11 according to a number of reports, Boards of Directors of scores of American companies handed out millions of bargain-priced stock options to their top executives. Ninety one companies that didn't regularly grant stock-options in September did so in the first two weeks following the terror attack. They were worth about $ 325 million. The terrorist attack shut the stock market for days. When it reopened on September 17, the stock market had slid more than 14% over five days, in the worst full week for the Dow Jones Industrial average since Germany invaded France in May 1940.(The Big Picture Post-9-11 Option Grants Under Scrutiny.htm)

Sources

The Big Picture Post-9-11 Option Grants Under Scrutiny.htm

Know More Media Economic Impact of 9-11 Attacks Still Resonates.htm