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How the events of September 11 shaped the U.S. economy




Steve DeLoach said he will always remember seeing planes hitting the Twin Towers on a projection screen alongside his colleagues on the morning of September 11.

DeLoach, chairman of the economics department, was in his office earlier in the morning preparing for his classes when Tina Das, economics professor, called him to alert him to turn on the news and see this. that had happened in New York. DeLoach and his colleagues silently stared at a projection screen as they gazed at the North Tower after the first plane struck the building.

DeLoach said he still held his classes that morning, but instead of teaching he watched the events of 9/11 unfold in front of him with his students.

It was like one of those hundred minute lessons and we just sat there watching without saying a word, DeLoach said.

For business students like Victoria Russo, senior, September 11 was a time to learn how past events can influence the economy and 20 years later the impacts of September 11 are still memorable for many, although they were short lived.

Temporary closure of the New York Stock Exchange

In the wake of the disarray in New York after 9/11, the New York Stock Exchange, the largest stock exchange in the world and responsible for allowing American companies to buy and sell stocks, has temporarily closed its operations. doors for a week.

DeLoach said one factor that caused the NYSE to shut down temporarily was the fear that ensued on the trading floor in the hours after the Twin Towers collapsed and drove people to sell their stocks at a rapid pace.

The stock market is falling because people are selling stocks. So if everyone’s selling, the price drops, DeLoach said. And again it really comes down to when there is uncertainty the best thing you can do is save and save something close to money.

Although the New York Stock Exchange reopened the following week, many stocks still suffered significant losses, including the Dow Jones. The stock index, made up of 30 major companies, on the U.S. stock market fell more than 500 points, or 5.4%, a week after September 11, according to the New York Times.

The global stock market also saw significant declines in stock prices following the attacks. Europe has experienced stock market declines this ranged from 4.6% in Spain to 8.5% in Germany, according to the New York Times.

Airline and travel industries suffer loss

Prior to September 11, the number of air passengers traveling had reached an all-time high with 64.5 million passengers and with 90.6 million seats available for purchase on flights in August 2001. However, the number of passengers traveling by air changed dramatically in the months following September 11.

United States Bureau of Transportation Statistics reported that the number of seats available for purchase has declined dramatically as airlines ground planes and cut flights to meet declining demand for air travel. According to the US Department of Transportation, the number of available seats fell to 67.5 million in September 2001.

DeLoach said he noticed the impact of 9/11 on international travel when he attended a conference in Philadelphia in October 2001. He noted that it was an international conference and that many international economists had were invited, but many participants were unable to attend the conference because they could not obtain their visas.

Basically, international economists weren’t getting their visas anymore, DeLoach said. The United States kind of tightened it up, so there were a lot of no-shows.

The number of seats available on airline flights took about three and a half years to surpass pre-9/11 levels, according to the Bureau of Transport Statistics.

The US economy is recovering

DeLoach estimates that the US economy recovered within weeks to months after 9/11. DeLoach said the overall impact of 9/11 was shortlived, although it is still memorable for him almost 20 years later.

It turned out to be short lived because after a few weeks everyone realizes, okay, it’s not going to happen every week, DeLoach said.

DeLoach also noted that the economy was in a period of decline between the second and third quarters of 2001. According to the Federal Reserve Bank of Saint-Louis, the real gross domestic product rose from $ 13.3 billion to $ 13.25 billion between the second and third quarters of 2001. He said there were more market forces at play than on September 11. which caused an economic decline during this period, but in the fourth quarter of 2001 the US economy recovered and regained its losses.

When Russo reflected on the importance of looking at past events, such as September 11, Russo said she believed watching September 11 made her realize how quickly the United States economy can be affected by events. international.

I think looking at 9/11 in particular, seeing how quickly our economy and everything was crippled so quickly from a national event is really important, Russo said. Just sort of realizing how the United States, we think, was such a powerful entity in the world and in one day it sort of turned out to everyone that it wasn’t. .




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