There’s some fascinating news out this morning about former Citibank CEO John Reed being named interim chief executive chairman of the New York Stock Exchange.
At a press conference Sunday morning, Reed was introduced by Laurence Fink, head of a search committee named by the board on Friday. Reed was not at the meeting, but in a conference call he said he was not going to be a permanent candidate for the position.
Fascinating that Reed would be willing to step into this role — even on an interim basis. The salary he’s taking for the position: $1. Maybe, just maybe, Reed — known, among other things, for his skills in applying I/T to business problems — will be able to make some real progress toward changing the specialist system that is currently the heart and soul of the NYSE. Vanguard Group founder
John Bogle had an excellent op-ed piece on this subject in Friday’s Wall St. Journal (subscription required).
While the NYSE bills itself as “a private company with a public purpose,” there is no doubt that its chairman’s most important role is to protect the interests of its members. And no interest is more important than the protection of the trading profits derived by the NYSE’s floor-based specialists. Thanks in large part to Mr. Grasso’s efforts, the NYSE has, until recently, enjoyed a remarkable level of prestige, providing the cover necessary to protect its inherently unfair and inefficient trading system.