Financial Planning / The Compound Effect

The four days Wall Street went silent, and the bell that rang anyway

2026-09-11 | 5 min | By Heath J. Harris

Twenty five years ago this week, the market closed for four days, fell 14 percent, and recovered in a month. A remembrance, and what it still teaches.

Twenty five years ago this morning, the opening bell at the New York Stock Exchange never rang. It was a Tuesday. By 9:30 a.m. both towers of the World Trade Center had been hit, and the exchange, a few blocks away, was evacuating. Markets did not open that day. They did not open all week. And 2,977 people never came home, including 658 employees of a single bond firm, Cantor Fitzgerald, whose offices sat at the top of the North Tower.

We write about markets in this letter every week. This week we want to write about the people underneath them, because what happened to the market after September 11 is really a story about people, and 25 years on it deserves retelling.

Four days of silence

US stocks had not stopped trading for this long since March 1933, when Franklin Roosevelt closed the banks. The strange part is that the exchange itself was barely damaged. What died was the plumbing. A Verizon switching center at 140 West Street, hard against the towers, carried roughly 300,000 phone lines and 3.6 million data circuits for Lower Manhattan, including a meaningful share of the lines the NYSE floor ran on. No lines, no market.

What happened next is the part worth retelling. Verizon crews rerouted a mid sized city's worth of connections through the wreckage and had the exchange's network live hours before the reopening. Cantor Fitzgerald, which had just lost two thirds of its New York office, had its electronic Treasury trading platform running again within about 48 hours, operated out of London. Largely because of that, the Treasury market reopened that Thursday, September 13. Stocks followed on Monday.

The bell rings again

On the morning of September 17, before trading began, the Federal Reserve cut interest rates by half a point. At the exchange, the floor observed two minutes of silence, sang God Bless America, and then firefighters and police officers helped ring the opening bell.

Nobody pretended it would be a good day, and it was not. The Dow fell 684.81 points, 7.1 percent, at the time the largest one day point drop in its history. By Friday the Dow had lost 14.3 percent, the S&P 500 11.6 percent, the Nasdaq 16 percent, and roughly $1.4 trillion in market value was gone. Airline stocks gave up about 40 percent in a single session. Insurers were looking at some $40 billion in eventual claims, at the time the largest insured loss the industry had ever absorbed.

Behind the scenes, the Federal Reserve was doing quiet work of its own. Banks that normally borrowed less than $1 billion a day from the Fed's emergency window borrowed about $46 billion on September 12 alone, and the Fed opened credit lines with central banks in Europe so that money kept moving worldwide while New York dug out. The financial system's shock absorbers, the ones nobody notices in normal weeks, all fired at once.

Here is the number we think matters more: about 10.5 billion shares changed hands that week, a record at the time. The system took the worst single blow ever aimed at it and processed record volume without missing a trade. Prices broke. The market did not.

A month, then twenty five years

On October 11, 2001, less than a month after the reopening, the S&P 500 closed above its September 10 level. The Dow took until early November. The Fed kept cutting, four times in all, from 3.5 percent before the attacks to 1.75 percent by December.

Then the market went on to do what it does, which is not "go up every year." The quarter century since included the rest of the dot com bust, the 2008 financial crisis, a pandemic that closed the world economy, the 2022 bear market, and this year's bond turmoil. Along the way it also delivered the longest bull market in American history, and it turned patience into the best performing strategy nobody brags about at parties. Through all of it, $10,000 left in the S&P 500 at its September 10, 2001 close, dividends reinvested, is worth about $110,900 today. Call it 10.1 percent a year for 25 years, earned by nobody clever. Just everybody patient.

The people who bought on September 17 were not making a market call. Many said so plainly. There was a documented wave of what researchers later called patriotic buying, ordinary investors who treated placing an order as a civic act. The week's numbers say their orders did not stop the fall. The next 25 years say they were right anyway.

What we take from it

Not a lesson about predicting. Nobody walking onto that floor on September 17 knew the S&P would be back in a month, or that the next quarter century would compound at ten percent a year. What they knew was the thing that sits underneath every price: a few thousand people, many of them grieving, who decided the system would open on Monday.

That is the asset you actually own when you own a broad piece of the American market. Not a ticker. The accumulated stubbornness of people who rebuild.

The market lost four days. The families of the 2,977 lost something no recovery chart can show. Twenty five years later, we remember them, and the ones who rang the bell anyway.

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