Stock Certificates Damaged

The flooding in New York from Superstorm Sandy hit the vault of the Depository Trust & Clearing Corporation (DTCC). While the DTCC is relatively unknown, it holds $35.6 trillion in securities and settled nearly $1.66 quadrillion in trades during 2010. The DTCC is the primary clearinghouse for securities in the U.S. The job of the DTCC is to keep track of the trades made in stocks, bonds, and other securities and track who owns those securities after each trade. Many financial instruments, such as Treasury bonds, are book entry only. This means that ownership of a particular Treasury bond is electronically recorded, often at the DTCC. Physical stock and bond certificates have been rapidly declining in favor of the book entry system, although as the damage from this flooding shows, there are still a significant number of physical financial certificates.