NEW YORK – From TEXIT to TXSE: given that Texas’ attempts at political secession from the rest of the United States (Texits like Brexit) do not take off despite the efforts of the activists of the Texas Nationalist Movement, why not try more forms soft, creeping, economic secession, especially on a financial and legal level? Elon Musk began by first moving his company headquarters and some factories to Texas, fed up with California’s high taxation and regulatory constraints. Then, when the Court of Chancery of Delaware, the state in which many American companies are legally incorporated, rejected the decision of board of Tesla to guarantee the founder new share packages (judged against the interests of the shareholders), the billionaire entrepreneur-inventor has also threatened to transfer the registered office of his companies to the more accommodating Texas. The great Southern State, which did not have a commercial court of standing, gave itself a Business Court in record time. Musk, for now, has moved SpaceX. For Tesla, a shareholder vote is needed: many resist. And it is not certain that many other companies are ready to abandon Delaware which imposes constraints but also offers advantages.
Now, however, another challenge arises from the South, this time financial: Texas attacks the monopoly of the New York stock exchanges – Wall Street and the Nasdaq technology market – by launching a stock exchange in Dallas, the TXSE. And this time behind the operation there is not a political movement or a single entrepreneur, but two of the major market operators: BlackRock, the largest investment fund in the world (manages assets of 10 trillion dollars, four times Italy’s national income) and Citadel Securities, a leading fund in electronic transactions.
James Lee, CEO of the company that wants to create this new financial market hoping to oust New York by offering lower costs and, above all, fewer rules to respect, has already raised $120 million from Texas businesses interested in the project. Lee has already requested the necessary authorizations from the SEC, theauthority federal government that regulates the stock exchanges. The green light should arrive within the year: The new exchange – all electronic but with a physical location in Dallas – is expected to begin trading next year while for the listing of new companies we will have to wait until 2026.
The project is ambitious not only because of the weight of its financial supporters. Texas is the state that is growing the fastest economically thanks to deregulation and low taxation (which also means reduced supply of public services and little assistance for the population). Today, Texas has a smaller number of large companies (those in the Fortune 500 index) only than California: they are Texan Exxon-Mobil, AT&T, American Airlines. While the Wall Street Journalwho broke the news of the stock exchange project, notes that even the largest investment bank in America, Goldman Sachs which has profoundly New York roots, is creating a headquarters in Dallas, the most important financial center in the state, which will have five thousand employees.
The operation is based on the liberal logic of Texas, but it is not just about fiscal convenience and fewer documents to produce and submit to the supervisory body. There is also a more political aftertaste: there is talk, even if in a whisper, of an anti-wokecapable of attracting companies that no longer want to submit to the constraints of diversity (such as the presence of quotas for women and representatives of ethnic minorities in top management bodies) introduced above all by Nasdaq. More generally, resistance to the introduction of DEI criteria is growing in many societies, especially in conservative states (diversity, equity, inclusion) in business management: an ebb compared to the wave wokeprogressive, grown in recent years.
It is not certain, however, that Texas will be able to put New York into crisis: It is not the first time that alternative stock exchanges to that of Wall Street have been created. Some are still standing but have very small market shares. While the stock exchange of Chicago, Boston and Philadelphia eventually merged into that of New York.
