The Federal Reserve Bank of New York works to promote sound and well-functioning financial systems and markets through its provision of industry and payment services, advancement of infrastructure reform in key markets and training and educational support to international institutions.
Regional & Community Outreach connects the Bank to Main Street via structured dialogues and two-way conversations on small business, mortgages, and household credit.
Economic Education improves public knowledge about the Federal Reserve System, monetary policy implementation, and promoting financial stability through the Museum and programs for K-16 students and educators, and the community.
According to McAndrews and Stefanadis, the competition spawned by electronic communications networks (ECNs) stock-trading systems that match buy and sell orders and execute transactions is already encouraging faster order execution, lower transaction costs, and better customer service.
McAndrews and Stefanadis also find that:
ECNs might eventually enable stock trading to migrate from a single site, such as an exchange floor, to highly interconnected market centers.
ECNs already have a sizable share of Nasdaq trading volume, but it is too early to predict exactly how they will reshape the equity markets.
Traditional exchanges and market centers are investing in new technology and trading systems in response to the growing challenge of ECNs.
James McAndrews is an assistant vice president and Chris Stefanadis an economist at the New York Fed.