Few are talking about the expected opening of the Texas Stock Exchange later this year. It is something that people who are watching the demographic and economic activity in the United States. With populations shifting around, especially at the upper end, we are seeing capital formations appearing in different areas.

New York City has been the global financial hub for more than a century. Like Hollywood, a topic I covered in great detail, we are looking at the potential death of the industry in that location.

Wall Street is synonymous with finance. Many of the world's biggest firms have a presence on (or near) Wall Street.

This is rapidly changing however.

Texas is becoming a major player in the financial arena. The opening of an alternate exchange in Dallas could be the nail in the coffin for New York City.

Texas Stock Exchange: The Death of NYC

What we are dealing with is more than just an exchange. The appeal to many businesses, especially in the energy sector, is enormous.

Texas is providing an alternative to California and New York in terms of the regulation. It is home to some of the largest Fortune 100 companies. Oracle, Tesla, SpaceX, and Chevron have all moved their headquarters (and large parts of their operations) to Texas.

Regulation is one area that business leaders are often concerned about. Many cite the impossible environment in California as a reason for the exodus.

As for the exchange, it promises to offer less stringent requirements. The New York Exchanges have gotten political. Things such as the make up of the board is now being regulated by the exchanges, not the companies themselves.

Y'All Street (as it is being called) is going to be different. The promise is the focus can be upon profitability. Energy companies have felt targeted over the last couple decades, having to comply with onerous environmental regulations.

The target market here is spread throughout the southern half of the country. There are thousands of companies for the exchange to target.

What we are seeing is an entire ecosystem being constructed around the luring of financial firms to the state.

No Need For NYC

Companies are relocating to Texas. This alone should be subject for concern. That said, there is another layer to this which has to be considered.

Anyone who is doing business with the exchange in Texas will have access to financial markets without touching New York City. In other words, it is completely shut out.

Major banks are already leading the charge.

JPMorgan, one of the stalwarts in American banking, now employs more people in Texas than New York. Goldman Sachs, another household name, is building a 800K sq foot facility that will employ more than 5,000 people. This is going in Dallas.

Wall Street is going to have some major competition.

The NASDAQ and NYSE are also opening up operations in Dalls. They are joining the party, realizing the appeal that is being offered to companies. Their goal is not to be left behind.

Wall Street is a major contributor to the tax base in New York City. A lot of the spending over the last few decades is due to the fact that Wall Street pays an outsized amount of the total tax revenue.

If business dries up, the city will be cut short. Most noticeably is the fact that Texas has no state income tax. This compares with New York having a 10% state tax along with one from the city. Then we get into the cost associated with housing and it becomes a seismic opportunity.

Detroit was a city that saw this happen. When the automotive industry left, the city was thrown into a death roll. Today, it is a shadow of what it once was.

If the financial sector leaves New York City, it will be another Detroit. Cuts will have to be made since the revenue generated by the industry cannot be replaced. We are talking about trillions of dollars from companies that have markets caps that will be nearing trillions.