"I remember they were throwing paper in the air and there was just this mayhem." "I looked at him and said 'what's going on?" "'" "He said well you know this is where they work, this is what they do'" "'This is what happens every day.'" "I was just like thrilled, I was like this is something I've never seen before." "You know, eyes got wide, I was just ahh." "Everybody looked like they were in a riot." "But there was some kind of order to it." "And I just had to be part of it." "From that moment I went literally back to my workplace and game my two-week notice." "Without having a contact." "Without knowing how I was going to get on the floor." "I Just knew this was where I needed to be." "I needed to be onto the floor." "FLOORED" "The biggest pits in the world are here in Chicago." "Chicago Mercantile, the Board of Trade, Board of Options Exchange, even the Chicago Stock Exchange." "There's no place else that you have nine thousand pit traders all in one city, no where else in the world." "This is the bastion of capitalism." "Player of railroads of the nation." "Stacker of wheat." "Hog butcher to the world." "That's what we do here." "If Chicago's know for anything else, let it be trading capital of the world." "This is Lasalle Boulevard, all the way down." "In the summertime it's absolutely beautiful, all the trees full up." "This is where trading started." "Why do we have so many traders here?" "I think it really is an entrepreneurial spirit and It's a very competitive environment." "I know the guys on the trading desks in New York are also very competitive but it's not physical." "Chicago it's physical." "It was based on gentleman's rules." "It was based on integrity, honesty, mutual respect." "But the business in the pit was the furthest thing from gentleman's rules." "I mean, you saw the worst in everyone." "You're standing there and somebody spits in your face somebody inadvertently stabs you with a pen or steps on your foot or spits on you like I said." "It's like something that you don't even really address" "It's like completely, you're immune to it it's like, it's silent-- quiet in the chaos." "The physicality in the pit was ridiculous." "We got to the point where at times the pit was physical that before the start of the opening bell we could pick our feet up off the ground and not fall." "The open-outcry process is you know, eighty percent bravery." "I mean it's a perspiration game, you have to have-- you have to have nerve." "Some are brilliant, some are totally eccentric." "Some are totally nerdy, some are just flagrant jerks." "At the Board of Trade." "The interview process that I had to become a member" "I remember the one question they asked me:" "'What do you want to do?" "'" "I said 'I want to make a lot of money and leave'." "You never found an ad in the paper you know, it was all people who trusted you." "A friend of the family got you on there because you were sharp or you had potential." "I grew up in the suburbs of Chicago." "My older brother is four years older than me." "He had already been trading for maybe about a year or so." "He thought I'd be really interested in it." "I played sports in college and my brother said that trading in general is kind of like sports." "When the bell goes off... 'boom'." "Like throwing a touchdown pass in Michigan Stadium with a hundred thousand people cheering." "Just that adrenaline rush," "I mean it's insane." "It's not a normal job." "I mean it's not a normal job you're not getting a salary every two weeks." "You don't have this health plan, you don't have your 401K." "You have to do it yourself." "When you've had a taste of the money you don't want to go back to being in the corporate world." "I mean, I just couldn't see myself working for a firm and getting reamed on by a boss." "Probably, Seriously, I'd probably tackle him or something." "I'd be like, you know, 'Who are you?" "'" "This is Credence Clear Water Revival, that's my acronym." "This is my brother's first album" "The Endless Summer." "And I got it for you know, colorful reasons." "You've got your little groups." "You've got your South Siders," "Your North Siders you've got the Jewish click, you've got the Irish click." "You've got the Italian click" "I'm Polish, I don't think we have a click." "You've gotta mesh and mind your niche." "There's a lot of uneducated people, which doesn't matter." "The uneducated people have a tendency too to make good money." "When you're in there from 8:30 to 3:15 it's all about money." "One guy's misery is one guy's, you know, profit." "Sad to say but that's true." "Not that I take advantage of that." "But maybe I would." "FUTURES TRADING 101" "By the middle of the nineteenth century" "Chicago was emerging as the transportation hub of America." "Trade routs by rail and water converged on the city giving birth to its famous stock yards and slaughter houses." "And a town hall market that would later become known as the world's first modern Futures exchange." "On April 3rd, 1848, eighty three merchants founded the Chicago Board of Trade." "Futures trading provided an opportunity for buyers and sellers to manage their risk against unpredictable price fluctuations." "Too many cattle this year?" "The beef prices are low." "Drought in the Midwest, the corn prices go higher." "If both the buyer and seller can agree on a price ahead of time we call this a Futures contract." "This agreement allows them the opportunity to protect themselves against paying to much or selling for too little." "So who are all these guys yelling and screaming and what are they doing?" "As the exchange grew in popularity, at times there'd be more sellers than buyers." "Or a demand with no one there to meet it." "Entrepreneurs saw an opportunity to take advantage of this imbalance." "Working in the middle as both buyer and seller." "This allowed them to profit by speculating with their own money while filling a vital need for market liquidity." "Or the ease with which goods can be bought or sold in the marketplace." "These early speculators became know as Local traders." "As their roll expanded over time they became major players on the trading floor." "In 1981 the Chicago exchanges introduced:" "Metals, Energy" "Currencies, Bonds and Stock Indexes." "Attracting more interest than ever before." "Soon calls were coming in from all over the world." "The modern Local trader might trade hundreds if not thousands of contracts in a single day." "Often getting in and out of trades in seconds." "Each time risking their own money in the hopes of profiting as they hold their own against the expanding market!" "Eighty bid!" "Eighty bid!" "Eighty bid!" "Eighty." "Thirty on two!" "Thirty on two!" "It was a live auction where the price of the commodity you were trading was determined by who would pay the highest and who would sell it at the lowest price." "When I would pay five and someone else would be willing to sell it at five we would have a match." "We would acknowledge it" "Check it in the pit by saying 'I bought so many contracts from you at this price.'" "and then we'd write it on our cards." "We'd end up handing in our cards to our clerks and the clerks would take it to our clearing house." "Yellow coats were designated for clerks." "Other than that, all the different colors and different designs that you see down there was to make you stand out among the crowd." "There were guys that had checkered jackets, red white and blue jackets." "Anything that made you stand out in your area of the pit, because you needed to be seen." "It's a misunderstanding that traders manipulate the price," "That they're responsible for prices going up or down." "It's completely false." "The supply and demand drives that." "If there's too little supply and demand is high, well prices are going up." "If there's too much supply and demand is flat, prices are going down." "The traders are just in the middle all they're doing is catching something for a tenth of a penny and passing it on hundreds or thousands of times a day." "It's actually funny because when you first come down here it's overwhelming, you can't figure anything out." "And quickly you kind of discover that guy's a broker, he's an order filler, he's a big trader." "All of a sudden people take on this personality so you get an idea of what's happening." "Well then you get some confidence and some arrogance and you decide that you're gona do this because you've been practicing and you think you can do it." "Well that's really when the learning starts." "Because that's when you realize how incredibly complex and often times scary and difficult and hard it is." "These guys are professionals, every one of them." "Many traders trade with their own money" "Each and every day to go in there and trade with your own rent money, not knowing whether you're gona make money or not is terrifying to a lot of people and I found it to be very, very scary." "I don't have any clients" "I don't have any customers." "It dawns on you," "Nobody trusts you to do what you do except your family." "And so in a lot of ways I'm a hedge fund manager of my own family's worth." "Money." "And they trust me not to fuck up." "The nature of trading is buying for one price and trying to sell it at a better price." "Period." "You get in there and you make your first trade." "You know, if you get whacked ten times in a row you pick yourself up by the bootstraps and you do it again." "We started at seven twenty, by seven thirty we were dripping of sweat." "Fortunes had been made and lost in the first ten minutes." "Everybody had their ups and downs." "I had bigger swings clue to the size I traded." "It really depends on how much you put on." "A five tick day, a five tick day- a five move from one to six." "You could make millions of dollars depending on how much you put on." "One hundred lot, if you put a hundred lot on in the Eurodollars it's worth twenty five hundred dollars." "O.K." "There are guys that have two thousand lots on." "So you're talking about two hundred thousand dollars a move." "One tick." "So it moves five ticks, you're up a million dollars." "It goes five ticks against you, you're down a million dollars." "If you traded a few contracts at a time, your risk was limited." "If you went and took on the market and bought everything available, your risk was enormous." "There were traders that went into the pit everyday and risked a house." "You know it wasn't unusual for guys to be making twenty, thirty grand a day." "It wasn't unusual for for them to be losing ten, twenty, fifty thousand a day." "And a lot of times you did that on one trade." "Whether people like to admit it or not this is a form of gambling." "How is it not?" "If you buy a stock, you're buying the idea that that stock's going up." "Fight?" "K mean 'chats" "That's what we do, and options are the same way." "I mean, there is a gambling mentality to what we do down there." "It's gambling to go down there every day because you are risking something." "But the rewards were phenominal" "If you took the biggest risk," "You're either going to get crushed" "Or you're gona be the happiest man on campus this afternoon." "I think somebody once said that floor trading offered blue collar guys a chance to get in with the big boys." "Commodity trading only has two purposes:" "1) to make a lot of money;" "2) to manage a lot of money." "And the faster you make big money, the faster you can do things with your life," "and I think that's what it's allowed me to do." "The numbers for successful guys are fleeting because you're only as good as your last trade." "It's what you don't lose." "It really is." "I mean, there's been guys who have made more money than me, but for some reason or another they've - it was taken away." "And so, I think the more successful trader is a guy who can keep it for, you know, to the tenth or to the ninth race." "The good traders know when to make money and leave." "I tell you." "I went to work every day, and when I wasn't at work, I was a miserable human being." "I mean, without a doubt" "I wanted to be back at work because I knew how much money you could make." "And so when I go away on vacation, it didn't matter what I spent because I knew I was losing more not being at work, and then - so they said, "But you could be losing money,"" "and I go, "You know, you never think of it that way." "Everything can be traced to being around the best traders in the free world." "I would watch these guys trade in my pit, and I would say, "If they're buying, I'm buying." "If they're selling, I'm selling." But I also wanted to see, it was important to me, how they handled a loser." "It's not what you make, it's what you don't lose that determines how much money you have at the end of the year." "I would watch these bigger and I'd go, how would they handle this stress of having a losing trade?" "What do they do when they had a losing trade?" "I literally just learned by watching the most successful people in the world." "Certainly, the numbers that come out of these places, how much money people make, can be staggering." "Yeah, my assistant, who's pretty junior, she makes a little bit more than my brother does." "My brother's a cardiac anesthesiologist." "My assistant is three years out of college and likes to drink beer." "You had a bunch of young kids making more money than they knew what to do with, and they found things to do with it." "Such as?" "You know, I mean, anything that you can think of that you can abuse yourself with." "That was part of the lifestyle." "There were five guys that rented a bus to take them to Michigan, golfing." "They hired a couple of girls to go on the bus with them, and by the time we get we it wasn't me" "I want that out!" "My primary over-the-counter customer base was made up of traders." "They're fun guys." "They're just fun to be around, and they're also they're nuts." "They're crazy." "I had a customer who I rang him up and it was" "$172." "He said, "What kind of number is that, $172?" "Make it $100 or $200, one or two, one or two."" "I said, "Well, which should I make it?"" "And he said, "I don't know." "Let's flip a coin."" "So I flipped the coin, he called it, he lost $200." "We did this every time he came in for three years." "He never won." "We had customers flipping coins." "He wanted to inspect coins." "He never won, every time it was like two or three." "I'd just say, "What do you want to make the spread?"" "He would do that." "He never won." "Every time he would over pay, he'd take the money out of his pockets, slam it on the counter and leave." "Loved the game," "Loved the game." "Joey called me and said he wanted me to deliver some cigars over to the pit and that he'd meet me there, he told me to bring a hundred, so" "I went over there and he met me, and brought me onto the floor." "And I knew a lot of the guys because I was doing business with them." "And some guys across the pit were like going like this to me, and so Joe said, "They want a cigar." "Throw a cigar to them." So I reach in the box and I throw a cigar across the pit, and the guys were reaching up and grabbing the cigars." "So I threw them everywhere." "I was just throwing cigars all the way across the pit whoever it is that's responsible for security in the pit or whatever it is, came up to me, and as he approached me he said," ""I'm the guy who's supposed to throw you out of here,"" "he said, "but I'm not going to." "Can I have a cigar?"" "ou know, every afternoon, when the Bond would close, we would all prepare for it." "It's like, okay, the Bond close is hitting." "When you watch those guys coming off the floor " "I mean, you could see their moods." "You could tell good days, bad days." "You know, like, life-changing days, we saw those days." "But it was palpable." "I mean, this was not like 5:00 and everybody punches out and walks out of the office." "Every time you make money trading it's like applause, but only you hear it because everybody else in that pit is rooting against you." "You're competing next to folks for every single trade, and the fastest person - whoever says "buy 'em"" "whoever says that first gets the trade." "And you know your neighbor sitting right here next to you needs them as bad as you need them." "He needs to make his mortgage payment." "He needs to put the kids through school, but you're gonna bury him, you'll tear out his liver because you heard that broker say 'sold' and that guy right there next to ya, he needs them," "and you just said, "Buy them."" "And he said, "How many did I get?"" "And you're like, "None."" "A good friend of mine said long ago, he said, "If you wanna friend, get a dog." "You don't have friends in the pit."" "Most of the people can set aside their differences outside of business, but sometimes when the all mighty dollar gets involved, people don't care." "I've seen guys yell and scream and nasty things ungodly things." "That's what helps them trade." "Yeah, and they probably don't like you anyway." "True, that's true." "They probably truly don't like you." "There's no doubt about that." "If they had a chance to, they would hit you if they could." "There will be fights in the pits." "No one's proud of that, but you will see people go at it." "There was a lot of fighting over who did the trade." "Did you do it, or did the guy next to you trade with me?" "One guy thought that he made the market, someone took his trade, finally, the guy lost his cool, ran over, and bit the guy in the nose." "I was just under 6 foot 3 and weighed 255 pounds, and I had little guys that would come up and berate me." "Guys would literally look at you and say, "You're a fucking idiot." "I can't believe you'd do that fucking trade."" "You'd look at them and go," ""You gotta be kidding me." "First of all, it was a good trade, that's why you're mad." "And second of all, shut up."" "And I think the guys that wanna strangle you after every trade, you kinda enjoy that, and you wanna do that again and again because that means you're doing something right." "That was the famous line on Chicago was," ""You wanna meet out by the horse"" "because we have this great big horse statue that sits out front, and that's where everybody would - if they would actually go down, they would have a group of hundreds following them." "I look at him, he looks at me." "He goes, "Yeah, let's go fuckin' outside."" "So we're walking out, and the motherfucker turns around and cracks me right in the fuckin' face hard." "I go, "A real fuckin' fight, huh?"" "So he swings at me again, and I duck, and his hands go through the fuckin' window, and the blood is spurting out like a geyser." "And he goes, "Mike, take me to the hospital."" "And I look at him and I go, "I think it's fuckin' too late."" "A lot of us have come from no education backgrounds really, other than high school." "We all started trading young." "Nobody knew anything." "I made, like, $2.5 million dollars in five days of trading." "It's a pure business and theory, but when there's so much money and things like that laying around, you actually see" "what somebody's really like." "You either go in there and try to be somewhat pure, and that's who I think I am, a pure trader, but I love the trading, but I hate the people." "These are fun." "This thing's on rollers." "So you know you're twisted when you do shit like this." "You got problems." "They're so big; you can't believe it until you come up to them and see how big an animal it is." "They think, Oh, you know it's a giraffe." "These things are - everything's dangerous in Africa everything because everything's used to being eaten." "When I go there, there's always stories of somebody dying or getting murdered by some animal, all the time." "See, they give you a list of - they call it a menu." "It's got animals on it, and next to it are price tags, so you look at something - it's like when you go out, and you say," ""Okay, there's two grand, there's a thousand," as you shoot something." "Like we scope our rifles in on baboons because they're only 50 bucks." "Lion hunt was a rip off." "It's like the fucker - they let the thing out of the fuckin' cage and I shot it." "That's the feeling I had." "You know, it wasn't right." "With the rhino it was the complete opposite." "It was the last time I was happy, when I got charged by that rhino." "Yeah, it's just not any fun, unless you can die." "But you need the heavy caliber for those big animals." "Oh, it's such a gas shooting this thing." "Wesltey Richards." "Ah!" "Fun." "The beauty of hunting is that it doesn't involve the Merc." "It doesn't involve my partners." "It's just me and something that wants to get away from me." "In this business you have to be a street kid and a business person because there's too much money involved." "Twenty-five years of trading, it is really a living hell if you're not one of them." "And I've never been one of them." "It's the whole power of 150 years of the future's industry in Chicago, which is where it started." "It's always been the broker." "The broker is the one who has the orders that come in from all outside customers." "If you're in with that guy, you can count on making a living everyday of your life." "It's a game." "You know, it's who you know, who you grew up with, who you married, who's your friend." "All that shit." "I would've been way more successful, way more, I couldn't even tell ya, if I could bite my tongue and learn to play the game a little more." "Like dress like this everyday when I'm in my 20s." "Fuck." "I was a fucked-up little jag-off." "Ah, fuck, look at this." "Motherfuckers." "The beauty of trading, when it's really going, it's a rhythm." "You're just doing your thing." "Problem is when it slows down sometimes, you start thinking." "Thinking why I should do this trade." "Why I should buy these." "Why I should sell that." "And anytime, anybody thinks, you're usually pretty fucked." "I call the market a big whore." "The market is a whore." "It's out to fuck as many people as it can." "That's its job." "It may not go against you fast at first, so you'll take a little heat, because it'll go against you a little bit." "And then all of a sudden it goes a little more and a little more, and you kind of get in a - it feels like in a hypnotism sort of thing, where you get caught in this downward spiral." "You know it's a loser, you've confirmed that it's a loser." "You're sitting there with the prices going further and further against you and it just feels like, almost like sometimes you can't get out." "Let's say you're down like $12,000, and you're like, "I should walk out of here."" "I should realize, you know, "I'm past my limit and walk outta here."" "What's the next thing you do?" "You're like well what the hell?" "I'll just, you know, I'll buy a couple more."" "And then wham!" "It goes again." "And the only thing that goes through your head is like, "All right, how much am I losing right now?" "There goes a car." "There goes a house."" "It's like someone hitting you in the balls, never ending." "It's like, wham!" "Wham!" "It's like, okay!" "Nobody can get you down the amount of money that you're going to be down a day, only you can do that." "And it's funny when you see something happen to somebody else." "It's very, very public." "And so, those guys that saw you lose money will probably, you know, twist that knife in your side, and say, "Boy, they looked pretty good an hour ago, didn't they Pete?"" "It's a vindictive crowd, it really is." "There's a joke that we always used to say when you go on the floor." "You've got the scan card." "You've got to scan you're way in." "Well if you scan it, and you look down and the light's red, and the guy behind you's like, "Ooh." "Bad day yesterday?" Or, "How you looking there?"" "You're like, "oh no, it's good."" "e II You're lik , Come on!" "come on"," "Then it goes green, and you're like, "All right, Yes!" "I'm alive for another day."" "There were a lot of times when the markets got very volatile that you wouldn't see a guy the next day." "And you knew he lost what he could lose." "Valentine's Day, 1994." "I had a little position on in the Yen." "The Japanese and the Americans were trying to make a trade deal." "And they kept extending the deadline, and finally they said, "There's not going to be a deal."" "So when we walked in on that Monday, our market was limit-up." "So that position immediately was like $40,000 against me." "And it was rallying." "It's $1000 a point." "So every time it rallied one point higher," "I lost another $1000." "Well, it rallied 100 points." "It was a $150,000." "It was pretty crushing, you know." "The feeling of despair where," ""Oh my God, I've lost everything."" "We had basically moved back in with my parents." "Ready?" "Tee No. 1." "I think we should walk over this way." "So I went out, and I got a job as a clerk making, you know, $400 a week." "At one point, my wife was drunk, you know, and she said, "You're nothing but a fucking clerk!"" "I think she really expected bigger and better things." "Okay, I'll play that one." "What's really nice is when the weather's a little warmer, but it's too cold for everybody else." "You get the whole course to yourself." "When the split came, it was pretty devastating for me." "I hugged my kids." "That kind of kept me going." "It was like, well," "I can't just give up now because they're depending on me." "All I know, is that when I was a little kid, I wanted to be a dad." "From earliest childhood, you know, I had a lot of brothers and I just" " I wanted to be a father." "You know how to use that?" "HO." "Okay." "Well, you just go to the bank, you put it in." "Punch in that number when it asks." "It's going to ask you what you want to do." "You want checking, withdrawal, and then punch in the number, how much." "Okay?" "When you put the card in, you just put the card in and you take it out." "You don't just leave it in there." "Can I go get gas with it?" "With the card?" "No." "Get cash and pay cash." "Okay." "All right?" "When I was in pre-school, he came in and he spoke to our class and I remember." "And he just had everyone stand up and yell as loud as they could." "And that was basically what I figured he did all day." "I didn't really know." "It's rough." "Our markets are really thin." "And it was just a tough week." "By the end of the week, I was asking people," ""How are you doing?" "How's it going in there for you?"" "Everyone of them was just like," ""It's brutal." "It's brutal."" "I'm on with three brokers, so I have one broker on my right, one on my left, and I'm on the headset with the third broker." "Sometimes I have to flip the headsets and say," ""Hey, can you hang on a second?" "I'm getting my asshole ripped open right here." "I'll get right back to you as soon as I get - "" "you know, it's like that." "The lottery is like $320 million right now." "So I bought a ticket for that." "When I played lottery before - when I was married before " "I always would buy the ticket thinking," ""I really hope that I don't win."" "Because I felt like it would change my life." "And I just felt like it would change my life to where I wouldn't be happy." "Well, I'll take the chance now." "And you will have a big loss." "And it's how fast did you cut your losses when you started to incur those big losses, and then hopefully you didn't have something like a drug addiction, an alcohol addiction, which break traders down." "And there was an incident where somebody had dropped drugs." "And nobody - and everybody's looking at it, and nobody would pick it up." "Because nobody wanted to, you know, be incriminated by what was going on." "So everybody's sitting there looking at the drugs nobody would pick it up." "Drugs and alcohol is a horrible stereotype of this business." "I think the high-strung type-A people, you know, gravitate towards that whether it's this industry or the sports industry, or the film industry, or insurance - it doesn't matter." "I mean those people, I think, it's a functionality of their personality, not necessarily the industry." "How do you deal with that?" "How do you deal with " "Did you make money everyday?" "Did you - what happened?" "You don't trade now." "Do you trade now?" "I remember seeing two or three grown men on the steps of the pit at the end of a crazy day in October of '87 crying." "I mean, that leaves a heck of an impression." "These were the men that - they could do no wrong." "They were there first, and they were some of the pioneers." "They had built huge fortunes, and they were just the wrong way on a day where it mowed them down." "Because of what can happen and how much money they can lose at a rapid pace, the stress level was too much for some of the guys who actually took their own lives." "And these guys were married with kids." "So you're talking about enormous amounts of stress and they just couldn't look their wife in the eyes anymore, or their children." "And it's pretty brutal, really brutal." "[One Year Later] [Early 2008]" "A couple of months ago, I told myself, "I'm leaving the floor."" "I definitely want to leave the floor." "My overhead is insane." "My gross profit was really, it was always growing." "And then just over the past year - last year for example, over less than half of what I made the year before." "Eight-thirty opens like the Stock exchange." "Everything - all cash opens at 8:30." "The trade was at 7:30 because unemployment number came out at 7:30." "So I missed that move, which if I was on the computer" "I would've had a chance at trading the number and probably would've been done at 8:00." "Instead," "I gotta stick around and wait for a move later on in the day, hopefully." "We're obviously going computer." "Whether it's, you know, tomorrow or a couple months from now, I don't know." "Ou can just tell by my coat too." "It's faded just like the floor." "There isn't this floor trader presence like there was." "It used to be that there was a couple thousand guys" "I don't know the numbers - that were trading in the pits." "We had as much as 500 people in the pit when I was there in the '80s." "Now there may be 50 guys in the pit." "A lot of the business has gone to electronic trading." "The Internet became very commonplace in the '90s." "And the speed at which information was learned by all players in the marketplace became so fast." "Everyone got all the information at the same time." "The trading industry started to go with the information industry, and went side-by-side with that." "They wanted to be able to trade instantly when the news came out." "And as they leveled the playing field, the people in the pits have lost a lot of their advantage." "The computer brings in so much girth." "There is no need for individuals to bring liquidity anymore." "In the old days, they would trade five, six, seven, eight, nine, ten." "And a lot of trading would take place between five and ten." "Nowadays, the market instantaneously changes price from five to ten, and there's nothing in the middle." "And as the markets have gotten more sophisticated, the customers know where things should trade." "The traders in the pit that just bought and sold, and a short-term buy here, looking to sell it in the next few seconds at a better price those people, the opportunities aren't there like they used to be in the pits." "You could see it in the NASDAQ." "The volume started to drift away from the pit." "There would be less volume." "And I was spending more in commission trading with the box - as I call it, the "box,"" "the computer." "The vile, the most vile invention in the world." "It is just a disgusting thing." "In the '70s," "I was on Wall Street." "I was at the discos, late at night, having fun, and I was a trader." "And it was immediate gratification because you could come in, in the morning you'd have money in your account." "The next thing you know," ""Geez, I just made $1000." "Let's go out and have some cocktails!"" "And we were sky-high for 20 years." "Should have retired, but I didn't." "Back to the Miracle-Gro." "I grew up in the late '50s early '60s." "So I didn't learn computer games." "I don't have that ability." "I'm 51 years old and it's killing me!" "Typical weekend:" "I get done with work on Friday, I come home and relax, my kids get out of school." "I'll give you guys a little squirt over here." "Makes you begin to question," ""Can I still trade?" "Am I a trader?"" "Nobody's bullet-proof." "It's one of my favorite shirts." "The last five years have been very hard." "We certainly don't mention finances in front of the children." "You gotta tighten up the belt strings." "So we just - we like the sale rack." "We like the values." "[Yawning]" "The pits are what made Chicago a banking center." "50% Off." "It is a travesty that they are hell-bent on going computerized when the system works as it is." "They just want to get rid of it and forget about it." "I have to wait another year 'til one of these guys gets marked down, until the clearance." "And it would've been the best power washer ever." "But" "But patience is a virtue." "The computers really change the dynamics." "You don't need market makers anymore." "Yes, they're in the pit, but they're not necessarily making a living the same way they did maybe seven or eight years ago, and definitely not the same living they made 20 years ago." "OK, What do we see here?" "See, here's the depressing part of a computer." "They are the thinnest of the thin, in terms of people, trillions of dollars change hands every day on the online platform, in Globex big numbers." "But the pits?" "No." "Why?" "Because there's huge bids, there's huge offers there's no space in between them." "Easy for the computers to match up." "When there's a bid of three, and an offer of four and it's 20 zillion up, you really don't need a lot of human out-cry to add liquidity, which is what humans do best." "You gotta realize, 95 percent now of all global markets are electronic." "I don't think you can find any pits overseas." "The grains, coffee, cocoa, sugar, the softs everything's switched over to electronic." "You'll have algorithms that says I want to buy them at this level, sell them at this level." "If I'm taking a profit, I want it to be this much." "If I'm taking a loss, I want it to be this much." "And then the computers will just run pumping in bids and offers all day against other computers." "Now what you have is only program traders." "These people, if you don't write a program, and you don't have it set to kick in at different intervals, you can't trade it." "I have not figured it out." "Consequently, I've gone into the cattle pit." "Two years, I've been standing in the cattle pit." "We still have paper." "They're trying to infect us with the virus." "The customers, however, like talking to their brokers and it's the last of the open out-cry." "I think one of the biggest reasons some of those cowboys made so much money was that they were excellent at reading people." "Picking up the clues on the brokers' faces, listening to the volume, hearing the noise you can determine the fear level in the marketplace." "But when it changes to the screen, you just see prices." "You see numbers flashing back and forth." "This is the life and the times of an upstairs trader." "You just sit here with no exercise." "You have to understand that I was in this incredibly stimulating environment of being on the trading floors for a number of years." "I think there were four women on the entire exchange floor." "You know, it's like, you're down there sink-or-swim." "You're in there with a pit of guys, all sweaty arm pits and everything." "And I'm just trying to open my mouth to buy or sell a one-lot." "That's how I started." "That's our exercise for the clay." "So to then go to an upstairs office, where you have none of that - no sensory input whatsoever." "And it's a learning curve, too, because it's like and old dog trying to learn new tricks here, you know?" "You make your share of mistakes, and "Oh!" "I didn't mean to hit 'buy!" "'" "I meant to hit 'sell,"' you know?" "Little kids grew up with these computer games, and just take it for granted." "It takes a while to learn." "If you're trading multiple markets, it's impossible to monitor all this stuff technically for more than say, one or two markets at a time." "My eyes are right there." "This is all for show and tell." "If you think you can humanly process all this gobbledygook, you are you're crazy." "It's like, right there." "I'm just looking at the last price." "So 99 percent of the time, I'm just watching those go from plus 25 to plus 30 to plus 25." "And umm." "That's about it." "Would you rather watch a football game on your HD, with a camera giving you all the action that's open out-cry or would you rather have that camera just focused on the score board the entire game?" "That's electronic trading." "That's the way they look at it." "And there's something to be said for that." "You know, we always were trying to see who can get the fastest edge." "Now it's nanoseconds." "It's - the computer is making that little marketplace that men used to make on their own." "Back in, back in, back in!" "Back in!" "Back in!" "Back in!" "Back in!" "Back in!" "Back in!" "Coming down, coming down, coming down!" "Give us a shot!" "Let us play." "Gold went lot - really deep." "It's hard to find a price." "I had it." "But Jesus, it was too deep." "Damn it." "Pop, you son-of-a-bitch, pop!" "Pop!" "Pop!" "Look at it, just ching-ching-ching-ching-ching." "It's supposed to be a money machine, but it's a money machine that actually takes your money too, you know." "Nice trade Adam." "Did you get a package, or - ?" "Not left." "Yeah, this here, the blue side these numbers are whoever in the whole world is trading these are their bids." "Meaning, they want to buy at that price." "This red side's the offers." "And we call it the "Ask."" "They're asking for you to pay this price." "Go, go, go, go, go, go, 90, 90, 90!" "This is good for the farmers!" "Let's do it for the farmers!" "Oh my God." "BUY '6'", buy 'em, buy 'em!" "It just won't go!" "Man it's fast, but isn't that fun?" "I mean that is - that is fun!" "Ah, it would've been funner if I got the price." "It's my second year of trading," "I was waiting for that day I got double digits." "And it happened at the beginning of the month." "I was pretty stoked about it." "Tried being humble about it because at any given moment they'll just take it away from you." "It's easy to just enter a market." "It's so easy to enter it." "All you gotta do is click the mouse." "You know?" "If you're having a good clay, and you just think like you can kill it still, and then all of a sudden you're chasing it, and then you're losing it and then you're pissed." "And you're emotions take over." "And that's mainly the problems that people have with trading is controlling their emotion." "That's why now make computer programs and plug 'em in the market, because it can't get emotional." "The emotion's built into the program, but that's already structured." "So it's structured to kind of control its losses, and if it's wrong it gets the fuck out." "The analysts come in." "These technical nerds." "Rotten people that all they're doing is putting logarithms, and algorithms, and monkey-rithms - who knows." "It's a bastardization of the market because economic news comes out, and the market should go one way, and it doesn't." "Now there's only one reason for that." "The computer programs are set the other way, and the markets don't react normally." "I made money for 18 years in a row, and then I lost money for three years in a row because the computer was trading." "Now, did the markets change dramatically?" "NO the market still moves up and down." "But the computer makes it impossible for a trader to trade." "The basic principle idea is that one person should not work with the computer alone." "Generally, there should be two programmers who should work in pair, so they constantly review each other's designs and code." "Um-hum." "One person's talking, one person's typing." "So like, I'm typing." "I'm thinking through, but he's saying what's going on" "And you do that in real time." "Right." "So we're constantly we're adjusting as we're typing." "These people's have programs, they say it's a wonderful system no hijinks in it." "I think that these people have hacked in and figured out how to run the books." "Late at night, somebody's playing the game." "Do you want to introduce everybody, or - ?" "Sure." "You've got Phil, who's a nuclear physicist out of Argon." "Hello." "And then we have Raja over here." "Hi Raja, how are you?" "Fine thanks." "He's our super high-end, back-end" "Super high-end, back-end programmer?" "Yeah." "This is Rama." "Hi Rama, how are you?" "I'm fine, thank you." " What are you doing?" "Again, back-end high traffic systems." "What do you do?" "Umm" "I worry." "He is our full-time worrier." "I'm a full-time worrier." "Larry has done a tremendous job in bridging the gap between technology and the brokerage world." "Larry used to work on the floor himself, and has taken all that knowledge he's gained over decades and been able to communicate it to all the developers here." "When we talk about world domination" "You always want to have one of these around." "Most of these people come in in the morning, the bell rings, they do their little trade." "The bell closes, they go home." "But they're not thinking one step ahead." "And they're not planning one step ahead." "Very few businesses will survive being run that way." "Where is your business plan?" "Where is you're forecasting?" "Which markets are changing?" "Where is the opportunity?" "Where is the technology to take advantage of?" "They haven't learned to adapt, you know, you've got a case of Darwinism here ya know." "I've been wanting to get on the computer but I've been forcing myself to do trades I shouldn't be doing." "Meaning, trading bigger than I should." "Putting more chips on the table when I should be taking away chips." "That pit just sucks you in the big contract." "And it takes you up into that realm where you should be sticking to my guns on what I do, but I get away from that when I'm in the pit." "For people who have the money to make the transition," "You know, great." "But for me, no." "Every time I think I'm there, it's like I get slammed." "It's just been such an uphill battle right now." "It's " "I've seen some of the most successful open out-cry floor traders move to the screen and absolutely have zero success." "To be a pit trader, and then be trading upstairs on the screen, and trying to trade the same way it's impossible." "It's " "A large percentage of my business is working with traders and trading firms." "I am a Master Certified coach and I'm a psychotherapist, and the application in the industry is huge." "I deal with individual traders." "I help them transition from being a floor trader to an upstairs trader." "I would take your hand, and I would lead you away and say," ""Did you like that?" "Was that exciting?" "Great." "It's going to go away." "But let me show you the next coolest thing." "Come on upstairs."" "And I would take that person to an electronic trading arena, and say," ""This is the future."" "I mean, you see guys just lose their mojo and they can't trade themselves out of a box." "And oftentimes it's just getting them to realize and become self-aware of what changed." "Some people make the transition in a matter of months, and some people it takes years." "And the difference is primarily how they're coming into my office - the approach that they're coming in with." "Are they open to change?" "Or are they coming with, "My life is over?"" "Well, the guy that's coming in," ""My life is over,"" "we're going to have a lot more work to do on the front-end to get him into a transitional job." "I have a friend that says, I gotta go up to his office." "He's going to teach me how to trade SPs." "They've got a program." ""Hit blue when you wanna buy, and red when you wanna sell."" "Great." "When I was growing up, everything was family everything." "We had summer vacation." "For three weeks we'd drive from one AAA motel to the next, to the next." "And we saw everything." "Families nowadays it's hard raising a kid." "They grow up too fast." "They're never kids." "They're on this computer, they're in this video world." "And the family unit is gone." "It goes fast, and it's very sad." "And that's" " I can allude that to open out-cry." "We lose open out-cry, we've lost an institution." "Did you ever think you'd see that on a door?" "Very nice, very nice." "This is my new little world." "It's a beautiful world, but it's a computer world." "Do you enjoy computer life?" "I'll tell you what, I have never been happier." "I hate e-mail." "I hate computers." "I don't really know how to respond to that." "I believe open out-cry is the most honorable," "and the most efficient trade in the world." "It's a new game." "It's a new world order." "It's a crappy game!" "Well, I mean, if you were making a fortune trading electronically, it wouldn't be a crappy game." "I wouldn't enjoy it." "There's a misconception that the Local trader can no longer compete with the black boxes, or the algorithm guys." "I can't." "First of all, they've gotta be right the market too." "I've traded for 30 years." "And I know markets." "It's a different feel, okay?" "So it's " "It's not a feel!" "It's not!" "That's my " "Let me propose this analogy." "You're a musician, but your trained in classical music." "All of a sudden, does that mean you can't play jazz?" "It's arrhythmic, it's atonal." "Sure you could." "You prefer the classical music, or whatever it is." "The market is like a symphony." "And as a musician, you have to be able to play the music that the conductor gives to you." "And that's, I think, what the world has evolved to." "Every market of volume is dominated by computers." "Not the cattle, and not hogs." "Okay, I stand corrected, you're right." "But that's only a matter of time." "But they have this program." "Where they're bid for 100, every nickel." "You hit 'em." "Some miraculous way, the computer gods" "I bought one!" "The rest is canceled!" ""Well, where did you go?" I don't know." "They have better programmers." "The people that are making money are the programmers." "I say the computer is the worst, and the most evil thing of trading that I have ever seen." "It's neutral!" "If I could convince you of anything after our discussion," "I want you to get this idea of somehow - this alternative trading modality - is evil." "I can't win" " I cannot beat the computer." "Then that's not the computer's fault." "It's not that my competitor is evil, he's better." "He's more efficient." "If he's following the rules" "It's more devious!" "Why is it devious?" "Because you have these programs out there." "Trust me when I say these people are cheating on the computer." "All right, let's stop right there." "They're cheating whom?" "Some people have better sources, some people have better servers." "You wanna race your car?" "You know, get a Ferrari, or get a Yugo." "It's the same thing." "It's just a car." "I just want you to know that it's a neutral entity." "It has no soul." "I disagree." "I" "It has no conscience!" "It doesn't!" "It's evil!" "Well, what can I say?" "And I think what happened in our industry, is when it did the open out-cry started going away and went to the computer people were in shock." "And are still looking for another place to go." "And are still looking for another place to go." "When they were giving evaluations, right out here in the seventh floor the supervisor's offices are." "Everybody's going to the supervisor's office." "When they sent me down to the fourth floor, I knew something was wrong." "I almost had like an implosion inside." "And I started to tear!" "I started - you know, grown man, starting " "I kind of knew it." "I kind of expected it." "You could see that there wasn't a lot of stuff going on." "But for some reason," "I thought that I would be able to walk out the door when I wanted to." "I wish I had more talent." "I wish I had more talent." "I wish I was more adaptable to the situation, but" "I realize that I'm limited in my services here." "But when the electronics came, they take the best." "And I'm not saying I'm bad, but I'm not the best." "I know that." "I'm limited." "A sixteen year ride isn't bad." "I was going to establish an office, computer trading." "And the then, I pursued that and then during that" "the markets were horrible." "Great, great excuse." "I was horrible trading." "And it was totally thrown on the back burner again." "In a year, I want to not to be living in Chicago, and hopefully I enjoy where I'm going to go visit out west." "And if I enjoy it there, that's where I plan on residing." "And that's where I think I would be most happy." "Skiing in the winter." "Summer - just recreational things." "What I'd like to do is be a park ranger." "Maybe something in that capacity, like a search and rescue." "Something where you're out in the element" "I kind of like that - being out in the element." "Maybe helping people." "Something where you feel good when you come home at the end of the day." "Wow." "But you know, that's that biggest feeling though, the anxiety." "You don't have that stress - it's hard to explain." "It's just you're more at ease because you realize it's not the most important thing in the world." "I don't know if you noticed how the house is kind of cool." "I could never keep the house this cool when I had the wife and kids here." "You know?" "We'd have to have it on 72." "When when Bobby comes and stays for the weekend, I'll turn it up a little bit, you know, for him." "But during the week, when I'm here I just turn it down." "And my bills are like nothing." "I'm very happy - comfortable - here." "When I come home from work and there's nobody else here," "this guy doesn't leave me alone." "I can't go anywhere." "I can't go from room to room, wherever." "Right?" "As far as Bobby," "I would love if he got interest in the business and found that he was good." "I've been kind of telling him to take an interest, look into it." "I've been willing to show him what I'm doing with the currency trading and stuff like that." "And I think when he's really interested, he'll let me know." "I'm leaving it up to him though." "I'm not pushing him into it." "Hey buddy, what's going on?" "You remember my son Bobby?" "Hi!" "So you're graduating this spring?" "Yeah." "You know where you're going to college?" " Not yet." "Are you going to college?" "Yeah." "I don't know what I want to do with my life yet, so." "This is a good place to because I've already learned a little bit about it, so I know some - a little bit." "Well, he's always telling me that now it's more transitioning into computers trading instead of people." "He told me that I should get more involved with the computer parts, because then there'll be more jobs for that." "Like in about ten years, they're going to come to me and say," ""Dad, how come everybody but you became a millionaire in the 1990s?"" "I just" " I look back at it as okay, that's just another opportunity that I wasn't able to take advantage of." "Should I spend the rest of my life regretting it?" "I don't think so." "I just look on the upside." "My kids are healthy." "It's hard when you been doing something 25 years making good money - and then it just stops." "Not because of anything you did." "It just stops." "That's actually '87 because I got my O03 Badge on." "Yeah, right during the crash." "What is that?" "SP pit." "One, two, three, he's dead that's three, he retired, he's shot." "That's why I got into the casino business." "I wanted to get out of this whole business." "I'll always love kids' stuff." "I was always collecting little" " I just like kids." "It's weird." "Kids and warriors." "Hese are great kids' moccasins." "The only reason I've gotten this far is because" "I've been tortured my whole life." "As a child I was tortured from my alcoholic father." "That's what I got hit in." "That's what's a little left of my motorcycle." "I was coming back from my daughter's soccer camp when I got hit." "And I was being followed by another parent." "And he came out." "I was laying on the ground when he saw me." "And I was bleeding out of my mouth, my nose, my ears, and my eyes because my head was blasted open." "I was just - you know yeah, I was dead." "The firemen - he knows some of the firemen - they said, "This guy's done."" "This business was perfect for me." "It's a real test on your own character because the greed and the stardom and all that bull-shit that goes with the money," "No more squirls today." "Eats a lot of people up and spits them out." "And one of the brokers that's been down there as long as me - or even longer he goes, "Boy it was a good run we had."" "I said, "Run?" "Fuck you a run, motherfucker."" "A run is something like when it's just" "I got this job and they keep paying me." "When I go down and go to work, it ain't no fucking run." "Fucking, this is like going to the mines everyday." "Fucking people." "Ugh, it's just me." "Okay, and then " "Yeah, big dog." "Oh, you look good man." "Thank you, buddy." "Oh good, the market's coming my way." "Perfect!" "This is our machine." "We change the months, we put orders in and out, then we get the execution logs." "Geez, I bought all these up a lot higher than where the market is now!" "You name it, we got it." "It's a crazy, crazy world we live in." "All right, now, I'm going to go into the pit and trade." "In my opinion, the byproduct of Internet electronic trading it is creating more stability in the world." "Stability meaning sharing wealth, but also sharing resources." "If you didn't have these traders trading everyday, it would be very unstable." "When you have traders trading against a particular commodity, it stabilizes the entire pricing scene because it's a very efficient marketplace." "Whenever there's a change, there's a reaction to the change." "So the more people that you have trading throughout the world, with different perspectives, the more stable the overall price of commodities will be." "Good evening." "This is an extraordinary period for America's economy." "Over the past few weeks, many Americans have felt anxiety about their finances and their future." "I understand their worry and their frustration." "We've seen triple-digit swings in the stock market." "Major financial institutions have teetered on the edge of collapse, and some have failed." "As uncertainty has grown, many banks have restricted lending, credit markets have frozen, and families and businesses have found it harder to borrow money." "We are in the midst of a serious financial crisis." "Yeah, it's 350 points down in the Dow again today, after it was positive several times." "The SPs rallied 50 points in the morning and ended up down 30." "And the markets are under extreme pressure." "The world is on fire right now, listen to the siren." "I mean does that sum it up?" "Probably every city in America sounds just like that!" "How's it going?" "Dude, you lost $4,500." "It's nasty dude." "And awesome, but it's weird." "You have to be patient, but then the patience has to turn into incredible decisiveness." "Right" "Because - let it happen - it's coming - this is a price I can use and then - pew!" "You gotta just hit it so fast." "And where I want to get in is where that stop is." "Just damn, you know?" "Oil is starting to do something here, so" "Is it?" "Okay." "Let's do it." "Let's do it!" "Let's go." "The big announcement was, earlier in the day when we had the interest rate - a worldwide interest rate reduction, which is pretty unprecedented." "Even with that amazing moment, which would in normal times - rally markets rally the Dow probably 500 points we're looking at a negative, down day still." "And you can look at the SPs." "This is on the first - that first initial reaction." "And of course, they overshoot that." "Everybody's looking for a way to get out." "So I think what we're hoping is for it to rally, but the entire planet is, you know?" "It's a whole, global effort now." "It's not just us." "We effect it, we're a big part of the global economy, so they don't want us to fail." "They can't have our dollar fail because we're a consumer nation." "So if our dollar's doing bad, they're going to do bad." "What's your role in all this?" "I ride the wave." "That's all I do." "You know, it's funny because I look back." "In the '80s and '90s, traders were the kings." "The back office fellows and the computer boys we would laugh at them." "And they got their revenge."