Semilla, Hazel Erica B.

ABFS 201

Introduction to International Trade

Mr. Jumel G. Estrañero

Behind The Obscurity of Wall Street: Its Influences in the Economic Sector

I. Introduction

Wall Street refers to a street found beneath the Manhattan part of New York City and is
known for being the household of New York Stock Exchange (NYSE). It was known for being
the legendary region of various massive U.S. investment banks and even its brokerages.
(Murphy, 2020). Wall Street is sometimes view as the central geographic of U.S. capitalism. The
tasks being done in the Wall Street involves some of the markets which are futures, foreign
exchange, bond and the commodities market. In its early years, the street was beside of a visible
wall which constructed when the Dutch colonized the New York City. (Amadeo, 2020).

The current financial crisis led the history of Wall Street close to its cycle. The wealth
carried by the rise of economy and a vigorous amount of arrogance happening on Wall Street
generates hassle and the order itself was relinquished in the end of the 90s era along the
nonintervention which return the past period of surplus in the finance sector. The tale of Wall
Street symbolizes negative aspects like cupidity and greediness which loathed by a lot of regions.
(Geisst, 2018).

According to Kenton (2020a), economy refers as a massive group of interconnected

consumption, exchange activities, and production which support in deciding on how resources
are being distributed. All of the supplies as well as the sale of products even the services are
being utilized to meet the demands of those who are living and working therein. Among other
factors, the economy of a specific area or nation usually controlled either by cultural identity,
rules, tradition, and geographical appearance that is revolving because of the individuals’
decisions and behaviors.

On the other hand, sector is known as the division of community in the aspect of
economic, political or sociological concepts. (“Sector,”, 2021). Moreover, it refers as a sector or
industry sharing similar functional features. Nearly a lot of economies are consist of the
following four increased sectors, including some of which are composed of narrower industries.
Some of the sectors included were companies focusing in environmental means like quarrying
and agricultural, another is businesses that are associated to production and engineering. Next
were companies that use service providers like supermarkets, media corporations and financing
institutions. Lastly, is in the field associated to cognitive aspects, which included corporations
interested in education. (Kenton, 2020b).

II. Body (facts and figures)

Wall Street exhibits an important role to the global economy, it is said that it serves as
the center of trading system of the world’s richest countries’ largest stock markets. It is known
for being the home of the historic New York Stock Exchange, which in relation to its relative
daily share stock prices and overall market’s capitalization of its selected firms, is the absolute
leading finance system internationally. (Picardo, 2020). While according to Epstein and Pollin
(2011), Wall Street particularly its firms have big accounts at their disposal that can be mediated
at will through the detailed rule-setting process. This particular firm however, had its specific
and vigorous level of self-interest that is interconnected in the information of direct judgments.

The modernization of Wall Street literally implies that the huge banks were unofficially
monopolized by the Washington State with this a rapid transfer of wealth is transferred mainly
on the bankers. These establishments are indirectly prospering by assisting the government rather
than the entrepreneurs. With the government favoring the short-term arbitrage and hasty strategy
of trading of the giant banks rather than long-term allegiance, it just resulted a decreasing of
income from the middle class and disrupting of jobs, a method of zero-sum economy. But even
these negativities are happening, the Wall Street together with its computer-driven trading is
turbulently prospering and savoring the underground protection given by the government.
(Gilder, 2016).

Wall Street is also the popular place for youthful individuals who wants to begin their
career in owning and handling their company, or for those who wish to be part of NASA or
Peace Corps. (Cassidy, 2010). Furthermore, though it is still not considered as the major source
of employment, Wall Street’s account which is only 5% of all jobs in the City based on the data
collected in the year 2002, still pursues its goal to be the major source of income, contributing

1
more than one fifth ( ) of total paid salaries around the city area, therefore securities industry or
5
other known as Wall Street values this particular profit since it serves as their grounds mainly
because this generates a lot of jobs and also demands especially to other industries. (Hevesi &
Bleiwas, 2004).

According to Mukunda (2014), even for the past several years, the banking industry’s
scale and income have risen exponentially while the legislation’s plan to place authority on Wall
Street was never been a success, by this situation, they have managed to boost their effect
specifically its capacity to have a control to the government by wasting huge amount of money
on the representatives and some political funding. They were able to delay and diminish the rules
that were created recently right when the financial crisis ended, having their advantage to reel
their hazardous activities. Furthermore, this outcome cause significant downsides to the economy
like uncertainties, prevention of productivity and mismanagement of assets.

Financial philosophies and deals that give way to disintegrate under cumulative cost of
false commitments, wasted value of shareholders, even the extraction of assets excluding its
regeneration make the Wall Street evidently let the financial downturns happened. (Ho, 2009).
In his book entitled “Freefall: America, Free Markets, and the Sinking of the World Economy”,
Stiglitz (2010) stated about Wall Street using the mechanism of economic collapse to embezzle a
lot of money.

Maybe they were right, and if they were, no politician wanted to take the rap for the
demise of the American economy. Wall Street used the fear of an economic collapse to
extract enormous amounts of money, quickly, from American taxpayers. (p. 50).
 Wall Street firms had never been linked mistakenly to charitable organizations, instead
these corporations supported and encourage illegal corporate debts which is quite astounding. If
not from its intervention, their self-interest and greediness which brought the lending mania into
its peak will never be achieved. (Morgenson & Rosner, 2011). Additionally, according to Talbott
(2009), deregulated attempts were very evident on this street that it nearly pushes it limits as to
no regulation at all.

The so-called popular Wall Street utilizes a method of swindling making us rely on
amounts of frauds pretending to be an investment service that everyone is needed. How
desperate we are the most makes them push their limits to manipulate us. It encourage us to
entrust our savings in a phantom-wealth funds, giving us speculations about luxury until our
terminal age that is sort of unbelievable in the realistic world. It also persuade us that if we
purchase some stock shares from the Wall Street stock market we are contributing to certain
companies for the expansion of its productivity, but in reality, we are transferring our own
capital to the pockets of the Wall Street private assets unknowingly. (Korten, 2010).

III. Analysis

Based on the premises provided, Wall Street affects the stability of the economy. With
the scenarios being done inside this firm, it is truly obvious that there are anomalies that are
happening. There is a method of swindling and embezzling of other’s money just to prosper and
be wealthier. A zero-sum game is being practiced in this place, a strategy that is bound to disrupt
or perhaps majorly affect the development of the global economy while they on the other hand,
are continuing to develop. It also seems that they easily get money from others by just
manipulating them with flowery words or promises that will make them easily agreed on,
making them fantasize and believe that they will experience a luxurious lifestyle that they never
had, a life that all you will think about is how to spend this huge amount of money, when in
reality, it will never happen but instead the firm itself will benefit the most.

Also with all the gathered information presented, it is really obvious that the
government just keeps on tolerating this kind of illegal act, even if they want to take control of
the Wall Street or terminate their operations, they don’t have the courage enough because they
too are manipulated and being controlled by them on first hand. At some point, they have also
contributed to the economy before, like in the year 2002 where they had generated many jobs
and increase in salaries, but still they are committing an immoral act which shows selfishness on
those who are working or part of it. They are also good at monopolizing certain states and banks
to take orders from them, showing that they are in power because they are the leading financial
sector around the world. Furthermore, behind these negative impacts being done by this popular
Wall Street, some are still entrusting their assets or want to be part of this institution with the
reason of gaining money easier without having to put so much effort and just do the encouraging
technique to persuade the clients to buy stocks or invest to them.

IV. Recommendation

This study entitled Behind The Obscurity of Wall Street: Its Influences in the Economic
Sector has reached the end of this phase. Here are some recommendations for future researchers
who wish to enhance the study:

It is very evident that Wall Street has its own skeleton in the closet mechanism but still
they are continuing to operate in the financial sector. With that, future professionals who may
want to be part of this kind of institution or be part of it itself must think deeply if they really
want to be one of them or know the background of the firms they want to work with if it inhibits
legal regulations or not.

This study aims to know the influences that the Wall Street has in the global economy.
This can be very helpful for those who want to know the different strategies and techniques
happening inside a firm and understand the works inside of it and if it has major effects in the
economy.

For the future researchers, the researcher suggests that he/she should have insights on the
Wall Street, perhaps a further study on how this institution started and how or why they’ve done
this kind of situation and why they are still operating despite of the illegality that’s been going
on.
 Also, when it comes to advancing the study enhancing it by providing more facts may
really be helpful. Moreover, weighing its pros and cons in the economy may also be added for
the justification if it is really helpful or not in the sector making the study even stronger.

V. Conclusion

Based on the researches conducted, the researcher therefore concludes that, Wall Street
has a lot of influences in the economic sector since the early 90s. With the given information
from various sources, Wall Street weighs a lot of negative impacts to the economy but still no
one has ever had the courage to track them down. This institution truly symbolizes greediness
and self-interest, some sort of parasite who sucks blood to be able to live while its host is slowly
dying. They gain money by manipulating others through broken promises and encouraging them
to continue investing their assets because it will eventually pay off in the future, when in fact it
will only make them suffer and lose their wealth at the same time.

They were able to manipulate even the government by bribing them with a lot of money
they got to have protection for them to continue their operations and to prevent them to be
interrupted by some rulers who want to drag them down. They are the example of people who is
greed enough to earn money easily without suffering enough rather working hard to earn money.
They can cause misallocations of assets. They can also delay the development of the economy
because of the embezzlement of money and a lot of illegal acts that are evidently happening on
this street.

Talking about zero-sum game, Wall Street will be the perfect example, they leave
everything behind just for them to be on top, drool by their ambition to have a luxurious life in a
short span of time and having a convenient life in a little effort is one of their goals. Not caring if
there is someone who is suffering while they are being successful shows an act of being selfish.
Wall Street reflects that there are certain people who will do everything and anything so that
they’ll become in power, greed, greediness, selfishness, being materialistic, fraud, swindling,
illegality, etc. these following words will always be interrelated with Wall Street, a place for
tolerating immoral acts, lying and cheating are never limited to them, it had been their lifestyle
ever since.
 VI. Way Ahead

Wall Street causes economic collapse based on studies, with the financial crisis that had
happened before it will not be impossible that another crisis will arise if these continue to
operate. Many people will suffer and be manipulated but can’t do anything and just let it flow
because of the privileges they have. With many people suffering, a lot of people will also most
likely to be part of this firm due to its easy-money technique that will surely gain them a lot of
wealth in a short period of time.

On the other hand, maybe Wall Street will benefit the economic sector if they change
into a regulated method of work, disarming their illegal acts and help boost the economy instead.
They have able to done that few years ago, and at some point with the field of work they are
conducting maybe they can be able to inhibit positive outcomes over the negative aspects they
have in the whole sector.

VII. Reference

“Sector”. (2021). In Merriam-Webster.com. Retrieved January 8, 2021, from

https://www.merriam-webster.com/dictionary/sector

Amadeo, K. (2020). The Secrets of Wall Street: How It Works, Its History, and Its Crashes.
Retrieved January 08, 2021, from https://www.thebalance.com/wall-street-how-it-works-
history-and-crashes-3306252

Cassidy, J. (2010). What Good Is Wall Street?. The New Yorker, 29, 49-57.

Epstein, G., & Pollin, R. (2011). Regulating Wall Street: Exploring the political economy of the
possible. Microeconomics, Macroeconomics and Economic Policy, 268-285. Houndmills,
Basingstoke, Hampshire: Palgrave Macmillan.

Geisst, C. R. (2018). Wall Street: A history. New York, NY: Oxford University Press.
Gilder, G. (2016). The scandal of money why Wall Street recovers but the economy never does.
Washington, D.C: Regnery Publishing.

Hevesi, A. G., & Bleiwas, K. B. (2004). The Impact of Wall Street on jobs and tax revenues.
New York State Office of the State Comptroller.

Ho, K. (2009). Liquidated: An ethnography of Wall Street. Durham: Duke University Press.

Kenton, W. (2020a). Exploring How an Economy Works and the Various Types of Economies.
Retrieved January 08, 2021, from https://www.investopedia.com/terms/e/economy.asp

Kenton, W. (2020b). What is a Sector? Retrieved January 09, 2021, from

https://www.investopedia.com/terms/s/sector.asp

Korten, D. C. (2010). Agenda for a new economy: From phantom wealth to real wealth. San
Francisco, CA: Berrett-Koehler Publishers, Inc.

Morgenson, G., & Rosner, J. (2011). Reckless endangerment: How outsized ambition, greed,
and corruption led to economic Armageddon. New York, NY: Henry Holt & Co. LLC.

Mukunda, G. (2014). The price of Wall Street's power. Harvard Business Review, 92(6), 70-78.

Murphy, C. (2020). How Wall Street's Name and History Remain Relevant Today. Retrieved
January 08, 2021, from https://www.investopedia.com/terms/w/wallstreet.asp

Picardo, E. (2020). Why Wall Street Is a Key Player in the World's Economy. Retrieved January
10, 2021, from https://www.investopedia.com/articles/investing/100814/wall-streets-
enduring-impact-economy.asp

Stiglitz, J. E. (2010). Freefall: America, free markets, and the sinking of the world economy.
New York, NY: W.W. Norton & Co. Inc.

Talbott, J. R. (2009). The 86 biggest lies on Wall Street. New York, NY: Seven Stories Press.