In a stark illustration of why back-up trading floors in out of town locations don't necessarily work during an epidemic, Morgan Stanley's back-up trading floor for New York City is closer to the cluster of New York virus cases than its existing trading floor.
The Wall Street Journal reported this week that Morgan Stanley was preparing a backup trading site in suburban Westchester County. Morgan Stanley declined to comment on where the backup site is exactly, but it seems likely to be in Purchase, a wealthy hamlet 50 minutes drive outside New York where the bank already has a commodities trading floor.
Purchase might be a good alternative to Broadway Avenue for many contingencies, but it's closer to New Rochelle, where the new cluster of New York coronavirus cases has emerged than it is to Manhattan. An attorney who lived in New Rochelle, his wife, daughter, son and neighbor have all been diagnosed with the virus today.
While this doesn't necessarily imply that lots of others in New Rochelle are also infected, or that the attorney didn't spread the virus to New Yorkers while commuting to Manhattan, it does underscore the fact that people at disaster recovery sites out of town are still liable to catch the virus.
Morgan Stanley declined to comment on the implications for the Westchester site, although it's understood that the nearby outbreak is unlikely to have any impact. Ultimately, banks may end up equipping traders to work from home. However, senior traders say this would likely be accompanied by a significant reduction in market making activities and a parallel drop in liquidity.
Photo by Jermaine Ee on Unsplash
Have a confidential story, tip, or comment you’d like to share? Contact: firstname.lastname@example.org in the first instance. Whatsapp/Signal/Telegram also available. Bear with us if you leave a comment at the bottom of this article: all our comments are moderated by human beings. Sometimes these humans might be asleep, or away from their desks, so it may take a while for your comment to appear. Eventually it will – unless it’s offensive or libelous (in which case it won’t.)