Sal Sodano, Chairman and CEO of the American Stock Exchange

This is a partial transcript from Your World with Neil Cavuto, December 20, 2002, that was edited for clarity. Click here for complete access to all of Neil Cavuto's CEO interviews.

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NEIL CAVUTO, HOST: It's time for Wall Street firms to pay up. A landmark settlement was announced today... What will all this mean for investors? Let's ask the chairman and CEO of the American Stock Exchange, Sal Sodano.

Sal, good to see you.


CAVUTO: For your day-to-day business what does it mean?

SODANO: Well, it's a very important move. There's really nothing that could be more important for the exchanges and the markets and all the firms out there to make sure the investor feels good about the marketplace. And this is a really important step saying, hey, the investor is the most important part of this marketplace and they need to know that. This is really a good step to making sure that we restore confidence.

CAVUTO: Still, the way this kind of fund is set up, only half of it makes its way back to investors. You're really talking about $715 million or so when investors have lost trillions. Is this just like a Band-Aid on a gaping wound?

SODANO: Well, I think the way you really need to look at this is there are clear and definitive rules and penalties for doing the wrong thing. So before where maybe some of this was possible due to the way the system was set up, well, that's not really possible any more. So you have to look at where we are right now and going forward. A billion dollars is a pretty big number. That's nothing to sneeze at. And I'm really pleased at the way this whole resolution has come about.

CAVUTO: Well, do you think, Sal, in your heart of hearts, you're quite an experienced Wall Streeter yourself, that we are able it disassociate analysts and what they research and then what they recommend?

SODANO: Well, I think history has recently shown us that there clearly was a conflict. So the requirement to truly separate what the analyst does and the investment banking activity, this is - this was a clear conflict. And I think we have done a really good job to make sure it is properly addressed.

CAVUTO: Do you have any doubts that we've had chances to address Wall Street behavior in the past only to revisit that same sort of - not even necessarily criminal activity, but just shoddy activity. You think we'll revisit it? Well, I hope not. If you look at what's happened in the past year, there's been a lot of issues in the market which have hurt investor confidence: the corporate scandals; this analyst conflict that we are talking about now; threat of war; news of layoffs everywhere. It's been a pretty negative environment for investors. But there are positive things as well. All the corporate governance standards that have come out from the exchanges and the Congress. A new Congress in place which is likely to put a stimulus package into the market which is going to stimulate the economy, hopefully put money back in the individual investor's and consumer's pocket, which drives the economy. Interest rates are still low. So there's a lot of good things happening, Neil.

CAVUTO: All right. Sal, have a great holiday.

SODANO: You too, Neil, it was to speak to you.

CAVUTO: Sal Sodano, the American Stock Exchange chairman and CEO from his home at the AMEX.

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