ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Friday, April 4, 1997 TAG: 9704040046
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: MAG POFF THE ROANOKE TIMES
William R. Johnston talked about opportunities and the state of the market at Hollins College Thursday.
William R. Johnston is president of the New York Stock Exchange, but he said he doesn't "have a clue" about whether declines on Wall Street are a slight correction or whether we are sliding into a bear market.
Johnston, in Roanoke Thursday to speak to students at Hollins College, said the only sure thing is that "the market fluctuates."
The Dow Jones industrials - the widely watched monitor of 30 major stocks - took only 82 days to gain 1,000 points to an index of 7000, he recalled. Then Alan Greenspan, chairman of the Federal Reserve Board, said the market was guilty of irrational exuberance.
Now, Johnston said, the market may be saying "we went a little too far too fast." It has lost almost 400 points in five days.
He said the gains were partially driven by money "sloshing around" from pension funds, Individual Retirement Accounts and Keogh plans. If that money slows to a trickle, he said, the markets will stop gaining.
The other factor in the gains, he added, was momentum, which used to be said only of sports teams.
Most young people today are accustomed only to market gains, he said. College students hardly remember the 1990 correction during the Persian Gulf War, much less the one that stands out in his mind. That's the period of 1973 and 1974 when the market lost half of its value over 20 months.
Johnston's wife is a Hollins graduate, and they met on the campus in 1959 when he was a student at Washington and Lee University. Johnston graduated in 1961, and they were married the next year.
He has set up summer internships at both colleges for rising seniors who are interested in careers on Wall Street. Last year's intern from Hollins, he said, has one job offer and several more interviews lined up.
Johnston often speaks to student groups. The first thing they want to know, he said, is how to find a job. He advises them to network and "pound the pavement."
The second thing they ask is "how to make a lot of money." But he believes today's students are less interested in money than previous classes. They are more concerned than their predecessors were about quality of life and spending time with their families and children.
They will also switch jobs more frequently, looking for work that is "exciting and worthwhile."
That will differ from Johnston, who has worked in one building for 35 years. He was a specialist working on the floor of the New York Stock Exchange in various capacities, and he became its president last July.
Three executive vice presidents report to him.
One is in charge of all regulatory effort because the exchange regulates its own members. This function takes a third of the payroll.
The second person is in charge of "prospecting" new companies for listing on the New York Exchange. Trigon Healthcare, for example, is a recent addition. Johnston said the exchanges compete for good companies, talking to institutional buyers and to brokers about the stocks.
The third vice president supervises technology and the daily operations of the trading floor.
The exchange, he said, is "relatively lean and mean," employing 1,450 people. "I have a very simple job," Johnston joked.
LENGTH: Medium: 66 lines ILLUSTRATION: PHOTO: (headshot) Johnston. color.by CNB