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To: Jill who wrote (617)	11/10/1999 10:22:00 AM
From: Jill	Respond to of 1817

For all of us: Frank Zarb sees Internet-led "mother of all bangs" In NEW YORK story headlined... Frank Zarb sees Internet-led ``mother of all bangs' please read date in dateline as Nov 10 instead of Nov 9. A corrected version follows. By Elizabeth Smith NEW YORK, Nov 10 (Reuters) - The Internet is about to hit traditional stock exchanges with ``the mother of all bangs,' Frank Zarb, chairman of the National Association of Securities Dealers, which owns the Nasdaq stock market, said on Wednesday. He said watershed changes were bound to rock the world's equities markets in the next couple of years, despite what he called enormous resistance by traditional stock exchanges to any regulatory and technological changes. Regulatory protection for the traditional exchanges would evaporate, as would physical trading floors with brokers carrying out stock trades, Zarb forecast in a speech to a group of executives at the Metropolitan Club in Manhattan. ``The reason for this change is the Internet,' he said ``The Internet is about to give us the biggest bang, the mother of all bangs.' Zarb outlined how his organisation was forging ahead to build the world's first global, digital market. In doing so, he made it clear he thought the Nasdaq was steaming past the New York Stock Exchange, the world's No. 1 stock exchange, by capitalising on technology and employing a democratic approach to the securities markets. Zarb said resistance to change by traditional stock exchanges was due to dependence on the status quo to protect the livelihood of many brokers working there. Nasdaq, the largest U.S. electronic stock market where some of the world's most prized technology stocks are traded, is prepared for the upheavals prompted by the Internet, Zarb said. In Japan, Nasdaq's decision earlier this year to partner Internet investment firm Softbank Corp. generated mass interest among Japanese entrepreneurs, Zarb said. Some 3,000 executives attended the first meeting of the recently formed Nasdaq-Japan club, a group created to promote the new electronic market that will become an alternative to the Tokyo Stock Market. Nasdaq Japan should be running by this time next year, Nasdaq officials have said. A plan to build a pan-European, London-based electronic stock market is the final pillar in Nasdaq's three-pronged plan to erect a seamless digital market where stocks would trade shares 24 hours a day, Zarb said. ``We are taking three major pools of liquidity and connecting them around the world,' he said. ``Since we are not stuck with a floor, we can do it more quickly. The need for a trading floor is disappearing quickly.' As part of the changes, the NASD in the next six to 12 months will sell stock in Nasdaq through a private placement, Zarb said. Large companies whose shares trade on Nasdaq such as Microsoft Corp. (NasdaqNM:MSFT - news) and Intel Corp. (NasdaqNM:INTC - news) will be allowed to participate in the offering, along with NASD brokers. Zarb also discussed the New York Stock Exchange's opposition to the idea of folding self-regulatory organisations policing the U.S. stock markets into one single self-regulator, an idea Zarb repeatedly advocates. Securities and Exchange Commission Chairman Arthur Levitt expressed interest in the idea in a speech in New York on September 23. New York Stock Exchange Chairman Richard Grasso is not a proponent of the idea. ``We'll wear them down over time,' said Zarb, only half-jokingly, in reference to the New York Stock Exchange. Securities industry experts in general have given a thumbs-up to the idea of a single self-regulator as a practical way for stock markets to become for-profit companies. The NYSE earlier this year announced it would explore the idea of becoming a publicly traded company. Its board has since authorised management to pursue the idea.