Return to Manhattan
NY Board of Trade---Falk, Harry---President (slow)
>> gas futures in new york fell for a sixth session to a one-month low. speculation below normal cooling demand this week in midwest and northeast will leave more fuel available for winter. it’s likely to cut into u.s. gasoline demand. price of crude oil in new york plunged. gold futures fell for a second time in three sessions in new york trading. the new york board of trade returned to manhattan today two years after the september 11th terrorist attacks destroyed its home in the world trade center. three billion in agriculture futures changes hands at the new york board of trade. its new headquarters in a shared space with the new york mercantile exchange. harry faulk is president and c.e.o. joining us talking about the return to manhattan. welcome back.
>> thank you.
>> give me a sense of how you feel today after the trading returned to manhattan?
>> i sort of feel like a new father. i mean this has been like having a baby, actually. i woke up at 3:00 this morning saying i hope everything goes well and we don’t have any blichs and everything, and everything went well and the baby was born and we are very happy to be back. it’s terrific. i mean 721 days from last time we were in manhattan, 489 trading days. but who was counting.
>> and the trading did change when you headed out to queens because you had less space to trade so you had to break up the trading.
>> we had to trade sequentially for a long time. we ohm had one ring. what happened is coffee, sugar and cocoa had set up a backup site in long island city after the 1993 bombing. then when we merged with the cotton exchange nobody thought about we’ll need more space if anything happened. we only had this two rings, when cotton and orange juice came with us, we couldn’t get them all in at once. then we made a couple new rings.
>> now you find yourself with the merc once again as you were several years back.
>> it’s quite nice, actually. it’s the way it should be. all commodities in new york should be in one place. there are synergies and also opportunities for traders that way, being in the same building if one market is very hot, people move to that market and so on.
>> how about making it one market, how about emergencying the markets, would that make sense?
>> it may make sense. obviously we don’t have the money to go out and sort of make an offer for somebody else. but if somebody made us an offer we couldn’t refuse we’d take it. >> what does it mean moving back to manhattan as far as the trading you’ll see. you’ll have an increase in trading. what do you expect as far as the day to day.
>> my guess is we’ll improve 10% over the next six to eight months. we’ve already seen interest in buying seats on our exchange from ko mex and nymx members, and i think that’s in anticipation of setting up small trading operations in our businesses.
>> seat prices on the cotton exchange have doubled this year.
>> yes.
>> there has been a rise in the seat prices on the coffee exchange. why are the seat prices growing.
>> one thing is we had a merger with the cotton exchange. cotton exchange seat prices went cheaper than coffee and cocoa. next year they’ll be equal. all members in the coffee exchange and sugar and cocoa exchange will be one member. therefore the seats will coming the. what’s happened is it’s coming the by the cotton exchange seat prices coming up to meet coffee, sugar and cocoa.
>> are the merks seats more expensive.
>> merck seats are 10 times more expensive. we’re the poor relative.
>> if there was a merger there would you expect to see the seats on your exchanges grow to the size of the merck.
>> we think our seats are worth more and they are slg out.
>> we have great possibilities. we have great projects on line that we think will enhance the value of our exchange over the next year.
>> now that you have the cotton, do you have any expectation of expanding the queens backup location?
>> we are going to keep the queens backup location. you never cancel your insurance certainly after once you get hurt. we got hurt once so we would never want to have that happen. had we not have that backup site i have to give great credit to the boards that existed and the staff that fought like crazy to make sure we did that, we’ll keep a backup site no matter what. it’s very important for all business in this day and age to have a backup site. when we had the blackout a couple weeks ago we found that some of our clearing members still didn’t have backup sites. so we were ready to open again the next day, they weren’t quite ready. they couldn’t get into the building, they didn’t have power. i think it tells you you better have a backup site. it’s not just terrorism but it can be acts of god and, you know natural occurrences.
>> they could find themselves outside of the market in a very difficult or serious time when prices are changing dramatically.
>> absolutely right.
>> as far as the future in manhattan, give me a sense of how different it is now as far as leaving queens, the feelings that your members have and the expectations for growth in the future.
>> well, believe it or not, some of our members didn’t want to leave queens. two years in the same place and people get sort of used to going to that place. a lot of our members had what i described as like the new kid in a school syndrome. i’m going there. i’m uncertain of where everything is. i don’t know where the bathroom is, i don’t know where everything is, but after one day they are settling in and they are quite happy with it, i believe.
>> back home. thank you very much. president and c.e.o. of the new york board of trade. now, the pair of parcel delivery firm d.h.l. is cutting back on its u.s. workforce.
