Well, well. The New York Stock Exchange has decided that Texas is worth an investment and that Dallas is the right place to stake a claim.
Welcome, we say, to our friends from the north. Those of us who made Texas home some time ago already understood that the devotion to light regulation, free markets, lower taxes and the flow of capital were making this state the place to do business. We’re glad the world’s most storied exchange is seeing the light.
But we can’t kid ourselves why the NYSE is suddenly interested in a Texas home. The founding of the Texas Stock Exchange, better known as the TXSE, has drawn a lot of interest in Dallas as a new financial hub for the nation.
We have long heard from business leaders on both coasts that the tangible and intangible costs of business have gotten too high. Whether it’s taxes in New York or regulation in California or declining quality of life in both, Texas presents an enticing alternative.
TXSE founder James Lee, a finalist for our 2024 Texan of the Year, plainly understood just how important Texas is becoming to national and international markets. Planting an exchange in a state where there is political alignment with freer capital investment only makes sense.
As Fortress co-CEOs Drew McKnight and Josh Pack wrote in these pages last summer, the TXSE is “a new breed of financial exchange — one that can deliver real commercial benefits to market participants and provide a competitive alternative to today’s virtual duopoly in the New York Stock Exchange and the Nasdaq.”
The NYSE’s decision to move its Chicago branch to Dallas is, in our view, an effort to forestall the success of a nascent exchange that could threaten that duopoly through the development of a lower fee market that is more attentive to the retail investor.
Or, it could force the NYSE and Nasdaq to reform entrenched ways that, over time, have not served the investor.
Either way, the investor should be better off thanks to Dallas.
What will happen over the long run is anyone’s guess. We live in strange political and financial times. The conservative principles at the root of Texas’ attractive business environment are morphing before our eyes.
If Texas strays from classic conservative values that trust markets and embrace capitalism into populist dealmaking for political gain, we could risk all we’ve worked for.
But if we adhere to what has made us great, there is no end to the possibility of a prosperous future.
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