Hundreds of New Yorkers past and present gathered downtown for an evening of celebration, rumination and time with family before facing a new year and uncertain economic times.

Larry Lampiasi came downtown to watch his granddaughter sing with her schoolmates in Brick, New Jersey’s Monsignor Donovan Choir. As a self-employed salesman, he says he’s felt the economic pinch, but thinks the holiday season will help.

Jack Ruppenthar, also present to support his grandson in the choir, agreed, noting that the current economic recession would hurt those with financial investments and retirement savings and 401Ks.  But with the holiday season upon us, he thinks it “will make people think more, being a little more frugal … putting more thought into the quality of gifts over the quantity of gifts.”

The ceremony outside the NYSE building on Broad Street between Wall Street and Exchange Place is quite possibly the most personal, meaningful and even oldest of all the high-profile holiday events in New York City, as it takes place in the heart of old New York and has been a tradition since 1923.

This year, while Mr. DeGraw and Ms. Franklin’s drew audience members who recognize their music and name, the evening’s entertainment and festive atmosphere also catered to the younger generation.  Performances from local teen musicians were featured: Long Island rock band Push Play and 14-year-old Tiffany Giardina – her music is included in an upcoming movie, “Another Cinderella Story” – who grew up in New York.

Also on hand was 25-year-old jazz pianist and singer Peter Cincotti, whose blend of traditional jazz and classic styles with rock and pop made his song “December Boys” and his Christmas-themed melodies transfix crowd members of all ages.

Alceste, a New Jersey native and former retirement center COO who moved to Florida several years ago, noted the impact of the current economic crisis on both the younger and older generations.

Janet Pritchard was pleased Wall Street was taking such a tough hit.

“It means the yuppies won’t be able to come and buy here,” Ms. Pritchard 44, said as she walked down the promenade in Brooklyn Heights with her 5-year-old son. “I have been living here for 10 years, I own my house outright, so personally I feel very safe.”

Down the road in Boerum Hill, Chris Mendoca, 33, said he hadn’t paid too much attention to the recent news.

“There are overpriced condos going up on every street corner, and rents are still skyrocketing, it doesn’t seem to be effecting much here,” Mr. Mendoca said. “My biggest concern is the price of gas, I don’t take the subway, so I hope that the price comes down a little,” he said.

Others thought there was reason to be concerned.

 “We should all be holding on to our seats,” said Don, 54, who declined to give his last name citing his position at the Federal Reserve. “I don’t think this neighborhood will feel the effects immediately, but they should be scared. All their money is in their million dollar homes, and guess what, when they need to sell, the buyers aren’t going to be there. Just watch what happens this week, it should have them shaking,” he said.

 Outside the courthouse Troy Griffith, 36, reiterated this sentiment.

 “I think the crisis will have a trickle down effect,” Mr. Griffith said. “The folks in this neighborhood will see it when their dollar doesn’t go as far, and when their houses don’t sell. It will be a rude awakening,” he said.

Robin Kahn, an agent for Corcoran, has a more upbeat attitude about the housing markets in the area.

 “I believe these neighborhoods will hold their value.  As long as people price their homes reasonably, they will sell. The greatest challenge I have, is convincing sellers their expectations might be too high,” Ms. Kahn said. 

http://www.cnbc.com/id/27239479

Reporter Stephen Labaton was present at the 2004 meeting where members of Morgan Stanley, Goldman Sachs, Lehman Brothers, Merrill Lynch, and Bear Sterns pleaded to be release from a limited regulation to the S.E.C board. 

The regulation had restricted the investment banks to allow their brokerage subdivisions to take on a certain “amount” of debt they could possibly handle. With the exemption, these firms would be able to tap into the billions of dollars that were on reserve.

Ironically, current Treasury Secretary Henry M. Paulson was chairman of Goldman Sachs at the meeting before stepping down two years later.

Here is an audio clip from Back Story with the Times:

http://graphics8.nytimes.com/podcasts/2008/10/03/03backstory-labaton.mp3

What do you think?

I sat down with Merrill Lynch Trader Waleed Shoukry and he shared his thoughts on the situation on Wall Street, how this is affecting the American taxpayer, the trader and what this all means.

Following my interview with Shoukry, I interviewed a current Executive MBA student for his thoughts on whether he had noticed any impact of the financial situation on business students.

See here.  Your questions/thoughts are welcomed.

Eventually protesters, journalists and onlookers began gathering at the site. The crowd of demonstrators included Socialists, members of Code Pink and other anti-war groups, and individual New Yorkers angered by the proposed government rescue of financial institutions. Spectators looked on curiously as cops advised people to stay out of the street.

Chants erupted spontaneously, such as, “We are pissed! Bail out this!” One man repeatedly yelled, “Don’t believe Bush’s lies! Don’t believe Paulson’s lies! Don’t believe Bernanke’s lies!” After about 40 minutes of chanting, mingling, drum-pounding and sign-waving at the terminus of Broadway, the protesters began to march toward Wall Street. For the most part they stayed on the sidewalk and the police didn’t hassle them. As they walked, many chanted “No deal for Wall Street, new deal for Main Street!”

I spoke with a woman who was walking from work to the subway in the midst of the crowd. Diane K., as she asked to be identified, empathized with the cause. “This is one protest I agree with, and I’m a conservative,” she said. “I’ve had it.”

Zelig Stern of the Socialist Party of New York City

Several protesters linked the economic crisis with the war in Iraq. John MacDougall, a member of a group called Peace Action and a veteran of the Korean War, said he was concerned that most Americans seem unaware of the economic consequences of the war. “I get worried about where the country’s going,” he said.

When the group arrived at the intersection of Wall Street and Broad Street, moving up the steps of Federal Hall and filling up the street between that building and the New York Stock Exchange, many yelled “No bailout!” repeatedly.

Protester Bobby Rodriguez, American flag in hand, criticized the federal government for its handling of the economy and other issues. “I think our founding fathers are turning over in their graves, and no one’s even reading the Constitution,” he said.

As the protesters held their signs aloft and chanted various slogans, a few Wall Street workers rushed to nearby subway entrances, some looking distinctly uncomfortable, others amused. One twenty-something guy in a suit yelled “Get a fucking job,” though this sentiment was drowned out by whatever the crowd was chanting at that moment.

Shane Miller, who works for a boutique trading firm, remarked that the stock exchange had already closed for the day before the protest arrived there. “They’re doing something for nothing,” he said. “They need to go to Congress — that’s where the bill is being worked on.”

A member of Billionaires for Bush who identified himself as “Rob DaPore” sipped what appeared to be champagne and responded to the protesters’ chants of “You broke it, you bought it!” with “We broke it, you bought it.”

Until I watched Rachel Maddow’s post-debate analysis show Friday night, I assumed that the protesters represented a small sliver of American public opinion. As a relatively cynical guy, I’ve come to see the population of this country as overwhelmingly apathetic even in the face of developments that affect their lives profoundly. However, I learned that the sentiments voiced by these street marchers actually reflected a wave of solid opposition to the plan among average Americans.

Now that Congressional leaders have apparently reached a deal, it remains to be seen whether this action will revive the financial services industry and the economy as a whole. If economic conditions worsen, Americans who view this deal as a handout to wealthy Wall Street institutions at the expense of taxpayers may not look too kindly on politicians who supported it.

UPDATE: The bailout bill did not pass on Monday. Some Republicans blamed partisanship, and Barney Frank ridiculed them. What I’ve heard from conservatives over the past week, including those who cried foul at Pelosi’s speech, is unbelievable. They don’t want to admit that their anti-regulatory ideology directly caused this crisis. Instead, some are blaming minorities.

The announcements came late on Sunday, after a weekend of nervous meetings between the Federal Reserve, Henry Paulson and the country’s top bankers. Paulson and Bernanke had already made it clear that they had reached their quota on bailouts. Despite the Wall Street heads’ agreement on an emergency fund, the fate of both firms was sealed. Merrill Lynch, the more fortunate of the two, is being bought by Bank of America for $50 billion. Lehman Bros, already $60 billion in the hole for the first time in 158 years, failed to close any buyers.

All this a mere week after the fall of Fannie and Freddie makes for a situation that the country hasn’t seen in decades, according to Peter G. Peterson and a certain Alan Greenspan on ABC news. Greenspan referred to the bailout of Bear Stearns alone as a “once in a half century, probably once in a century type of event.”

While Bernanke and Paulson are not bailing out Lehman, they are relaxing some regulations to calm the wild-eyed hordes of frightened investors. For instance, the purchase of Merrill drops Bank of America below minimum required funds – a condition the Fed is planning to overlook. The Fed may also start taking junk bonds and other previously unacceptable assets as collateral.

Predictably, thousands of workers were laid off during the process. Right now is the worst time on Wall Street to be unemployed.

Are we scared? Perhaps we ought to be. AIG’s stock went down 30 percent and Washington Mutual is allegedly teetering on the brink of failure. With the federal government already balancing the fate of the country’s biggest mortgage lenders on the heads of the taxpayers, no one knows which firm will implode next. Ironically, a major factor in keeping the players alive, is our confidence as consumers.

Update: Washington Mutual has $143 billion in insured deposits according to Financial Times. The FDIC – the corporation responsible for giving citizens their money if the banks fail has just about $45.2 billion. If Washington Mutual fails, it can drain the FDIC or force a redirection of funds from the treasury.