Twenty-five years ago this week, I dropped my son off at school and drove past Blount Memorial Hospital to my office at PaineWebber in Maryville.
I was an old-fashioned stockbroker in those days. The Internet was still in its infancy. Social media didn’t exist. My morning routine was scanning a few investment message boards and then flipping on the office TV to CNBC for the pre-market news. That morning the news was unmemorable until 8:46, when the first plane hit the North Tower.
You can watch the moment the coverage broke here.
The initial speculation was that it was a small plane accident. When the camera zoomed in on the damage, the gash in the building made it obvious that this wasn’t a small plane accident but an act of terror.
My wife called me from the gymnastics studio where she had taken our 2½ year old daughter. She caught the news on the vintage console TV in the lobby. As we spoke, I watched live as the second plane crashed into the South Tower. About half an hour later a third plane hit the Pentagon. A fourth went down in a field outside Shanksville, Pennsylvania, after the passengers on board decided to fight back.
The market never opened that week. The World Trade Towers were the epicenter of Wall Street activity, and we were already dealing with huge market losses after the dotcom bust in 2000. When the NYSE finally reopened the following Monday, the Dow fell 684 points. That was the largest one-day point drop in its history to that date. By Friday markets were down about 14%. The uncertainty in the aftermath of the attacks sent a panic through markets.
I still recall the horrific images of the Towers burning and collapsing, of bewildered workers wandering the ash-covered streets in the financial district, the heroic actions of firefighters and police that day. I also recall how the attacks united all Americans together.
Our country has always been divided along religious, political and economic factions, but the attacks that day were an attack on our entire nation. 9/11 made all those debates meaningless. What mattered was to first mourn the innocent citizens who died. After that, we remained united in resolve to answer for the 2,977 people who died. It’s hard to imagine this considering how divided and contentious our online discourse is today, but after 9/11 we were truly united behind a single cause.
I’ve been to Ground Zero on a couple of occasions. You can’t visit it without reliving those days. When you walk away, you understand that, as painful as that moment was, it wasn’t the end but the start of a new chapter in our nation’s history.
The market’s chapter took longer to write than anyone expected.
Stocks rallied from the September 2001 lows through March 2002. After that brief rally, they resumed the downward path. It took until May 2003 for the Dow to close a month back above where it stood the month of the attacks, and until December 2003 to permanently clear the pre-attack level. From the month-end before 9/11 to the low in September 2002, the Dow lost 24%.
Enduring that three-year decline was the biggest professional challenge I had faced in my financial career. Markets cycled through a series of false rallies and then rolled over to new lows. I frequently called my brokerage clients to encourage them to buy the dips and accumulate more shares. I didn’t know when it would end, but I knew it would eventually.
After three years of this rollercoaster, most of my clients probably thought I was crazy. I didn’t realize it at the time, but the endless assurance and encouragement that I offered clients during that crisis was instrumental to my own future. When we started LeConte in 2007, the brokerage clients who stayed with me after 9/11 became the foundation of our new firm.
That is the part of the story I’d ask you to keep. Markets don’t recover on a schedule. They recover when the fear finally wears out, and nobody rings a bell the day it does. The only thing you control in the meantime is whether you’re still in your seat when it happens. Staying is the whole strategy.
I will never forget that day and the days and weeks that followed. I pray our nation remembers it too, and that we are never again reminded of how much we hold in common by losing so much of it at once.
