Chicago

Chicago exists because of a six-mile stretch of swamp. In 1673, French explorers Marquette and Joliet discovered what Native Americans had known for centuries: a short portage where waters almost touched—the Chicago River flowing to Lake Michigan, the Des Plaines River flowing to the Mississippi. Whoever controlled this muddy gap controlled the connection between the Great Lakes and the Gulf of Mexico.

For 175 years, that gap remained a strategic curiosity guarded by fur traders and later Fort Dearborn. Then in 1848, the Illinois and Michigan Canal opened, and Chicago transformed from lonely outpost to transportation node. The city's population tripled in six years. St. Louis, the established Mississippi hub, watched helplessly as commerce rerouted through its upstart rival. The canal was soon superseded by railroads, but the pattern was set: Chicago had become the place where things passed through.

That hub position created an unexpected specialization. When farmers shipped grain through Chicago, merchants needed ways to manage price risk across time. The Chicago Board of Trade, founded in 1848, invented standardized futures contracts. When the Chicago Mercantile Exchange launched currency futures in 1972, it pioneered financial derivatives—applying risk management tools honed on pork bellies and wheat to the world's currencies. Chicago didn't just move physical goods; it began moving risk itself.

Today, Chicago's $906 billion regional economy reflects layered path dependencies. CME Group processes roughly $1 quadrillion in derivatives annually—making Chicago the undisputed capital of global risk transfer. Financial services employ 7.3% of the city's workforce, well above the national 5.8%. Yet the city's economy now trails peer metros. Professional and business services (19.3% of employment) are shedding jobs. Healthcare and logistics remain the main growth engines.

By 2026, Chicago faces a familiar test: can a hub adapt when the flows change? The city has reinvented itself before—from portage to canal to railroad to derivatives. Whether it can capture the next transformation will depend on whether that original logic of convergence still applies in a world where transactions increasingly need no geographic center.