What are photos of glum-looking Wall Street traders meant to convey?
December 4, 2018 3:57 PM Subscribe
It's a cliche for the media to show photos of exhausted or unhappy-looking Wall Street traders on a day when market indices drop sharply. What is being conveyed by such photos? If the traders are actually upset, why are they?
Is it that the traders are exhausted after a day of heavy trading volume? Or are they supposedly disappointed that stock prices have gone down that day? If it's the latter, why would we expect that they'd care which direction prices swung, since they're just agents working on behalf of other people and institutions doing the actual buying and selling? Or is it simply that the traders in the photos are supposed to represent how we all must feel about stock prices going down, even if it's only on that particular day (and still leaving me with the question of why the traders themselves seem to be upset)?
Is it that the traders are exhausted after a day of heavy trading volume? Or are they supposedly disappointed that stock prices have gone down that day? If it's the latter, why would we expect that they'd care which direction prices swung, since they're just agents working on behalf of other people and institutions doing the actual buying and selling? Or is it simply that the traders in the photos are supposed to represent how we all must feel about stock prices going down, even if it's only on that particular day (and still leaving me with the question of why the traders themselves seem to be upset)?
Best answer: WHenever I see photos, I look for Peter Tuchman, one of the most recognizable traders on the floor. Wall Street’s most photographed trader defends NYSE photos
posted by the man of twists and turns at 4:13 PM on December 4, 2018 [15 favorites]
posted by the man of twists and turns at 4:13 PM on December 4, 2018 [15 favorites]
Perhaps not on the New York exchanges, but in the old days of commodity trading (like in the pits at the Chicago Board of Exchange), some of the traders working down there were playing their own money. If was a really bad day one could even get wiped out.
posted by JoeZydeco at 4:59 PM on December 4, 2018 [1 favorite]
posted by JoeZydeco at 4:59 PM on December 4, 2018 [1 favorite]
Best answer: Adding a human interest angle to some dry, numbers-heavy reporting? Per the NY Times last February: "What these images of men on the trading floor convey is the mood of Wall Street, where the action affects everything from the fortunes of corporate executives to retirement savings of middle-class families with 401(k) accounts. And on days like Monday, when the Standard & Poor’s 500-stock index and the Dow Jones industrial average both experienced historic drops, pictures of anguished traders in news stories were reminders that what goes up inevitably comes back down (if only to go back up once again)."
(Mr. Tuchman's pictured in that Times link, but that Washington Post interview the man of twists and turns included is a hoot:
Q: You buy and sell all day. Do you have advice for mom-and-pop investors?
A: Don’t panic. Hang in there. Take a reasonable profit and do not wait for an unreasonable loss. If you can ring the cash register, do so. But don’t panic when markets go up and down. ...
Q: Do you own stock?
A: I have never owned a share of stock in my life. I do not eat my own cooking. Funny thing about money. If I started to worry about my own profit and loss, I would be less concentrated on my customers’ well-being. And I also have two children in college, so I don’t have any money to buy stocks.)
posted by Iris Gambol at 5:18 PM on December 4, 2018 [11 favorites]
(Mr. Tuchman's pictured in that Times link, but that Washington Post interview the man of twists and turns included is a hoot:
Q: You buy and sell all day. Do you have advice for mom-and-pop investors?
A: Don’t panic. Hang in there. Take a reasonable profit and do not wait for an unreasonable loss. If you can ring the cash register, do so. But don’t panic when markets go up and down. ...
Q: Do you own stock?
A: I have never owned a share of stock in my life. I do not eat my own cooking. Funny thing about money. If I started to worry about my own profit and loss, I would be less concentrated on my customers’ well-being. And I also have two children in college, so I don’t have any money to buy stocks.)
posted by Iris Gambol at 5:18 PM on December 4, 2018 [11 favorites]
Best answer: People still get wiped out.
A lot of volume is done OTC, so big dramatic scenes on trading floors are less of a thing. But I think there are still solo market makers — the guys who supply liquidity and help set prices with their bid/Ask spreads. (I’ll buy this thing at 1 and sell at 10 (implied you think it’s worth 5), who wants some of this action? And then people either hit the bid or lift the offer, or some other guy comes in with a different market, 3/13, (bc he thinks it’s worth 8), so now your market is 3/10, etc etc, someone eventually buys and someone sells and you have a price for the moment.) And those guys can and do absolutely get wiped out.
But also even the guys who aren’t trading with their own money can get, you know, fired, and their compensation is tied to their performance. Like your boss at the market making firm isn’t gonna be happy if your position is now completely fucked and the clearing house wants to have a conversation bc now you’re carrying too much risk or whatever. Similarly if you were not a market maker but trading your own book at some bank or fund and you were on track to end the quarter or year or whatever with whatever amount of profit on your position earning you a bonus that is the majority of your compensation, and that profit is now gone, so is your bonus. And possibly your career. And these jobs are often mostly about the bonus.
And on top of that a lot of dudes get REALLY emotionally invested in their performance as masters of the universe or whatever. That generally doesn’t work out, from what I’ve heard.
posted by schadenfrau at 5:22 PM on December 4, 2018 [2 favorites]
A lot of volume is done OTC, so big dramatic scenes on trading floors are less of a thing. But I think there are still solo market makers — the guys who supply liquidity and help set prices with their bid/Ask spreads. (I’ll buy this thing at 1 and sell at 10 (implied you think it’s worth 5), who wants some of this action? And then people either hit the bid or lift the offer, or some other guy comes in with a different market, 3/13, (bc he thinks it’s worth 8), so now your market is 3/10, etc etc, someone eventually buys and someone sells and you have a price for the moment.) And those guys can and do absolutely get wiped out.
But also even the guys who aren’t trading with their own money can get, you know, fired, and their compensation is tied to their performance. Like your boss at the market making firm isn’t gonna be happy if your position is now completely fucked and the clearing house wants to have a conversation bc now you’re carrying too much risk or whatever. Similarly if you were not a market maker but trading your own book at some bank or fund and you were on track to end the quarter or year or whatever with whatever amount of profit on your position earning you a bonus that is the majority of your compensation, and that profit is now gone, so is your bonus. And possibly your career. And these jobs are often mostly about the bonus.
And on top of that a lot of dudes get REALLY emotionally invested in their performance as masters of the universe or whatever. That generally doesn’t work out, from what I’ve heard.
posted by schadenfrau at 5:22 PM on December 4, 2018 [2 favorites]
The irony of those pics is that old-school voice trading is mostly dead.
More likely to see a dude breaking a phone at some boutique hedge fund building.
posted by JPD at 5:32 PM on December 4, 2018 [2 favorites]
More likely to see a dude breaking a phone at some boutique hedge fund building.
posted by JPD at 5:32 PM on December 4, 2018 [2 favorites]
I think a lot of times what they're intended to convey is at least partially "this story about the stock market needs an image to go with it and a recent photograph of people reacting emotionally is more visually interesting than any of the other possible options."
posted by eponym at 5:33 PM on December 4, 2018 [2 favorites]
posted by eponym at 5:33 PM on December 4, 2018 [2 favorites]
The other irony? Those people look like that every day, regardless of what the market is doing.
posted by Mo Nickels at 6:18 PM on December 4, 2018 [5 favorites]
posted by Mo Nickels at 6:18 PM on December 4, 2018 [5 favorites]
Best answer: I traded on the floors of several exchanges for over a decade. Mostly on the CBOE, but also on the CBT, CME and the AMEX. I have no idea what the intent is when they show those pictures, but the emotion in them is real. When I traded on the floor there were two types of floor traders, market makers and brokers. Market Makers could further be broken down into independents and those part of large broker dealer operations. I traded my own money. I was taking 100% of the risk of my trading (and getting 100% of the reward). I had a wife and 3 kids, a mortgage, cars and all sorts of typical adult expenses. I had no salary. There were days when I went to work and afterwards owed someone money. Most people go to work and get paid for that day's work. It takes a certain mindset and personality to be a market maker. There are obligations to make markets in instruments that are clearly a financial burden. The cost of either buying or leasing a seat was extraordinary. Like having a mortgage on a half a million dollar house. The old cliche that I would buy things I did not want, sell things I did not own and had a seat I could not even sit in was actually true.
The act of simply being on the floor as your workspace is challenging. I stood in pretty much the same spot from 8:15am CT until 3:15 CT without a break. Often, I was screaming across the pit to make a trade via voice and hand signal, itself with its own inherent risk of an outrade or DK (Don't Know). I was pushed, bumped and stepped on. Admittedly, I probably pushed, bumped and stepped on others. It was physically exhausting especially on days like today. It was also mentally draining. I was doing calculations in my head continuously. I was trying to read other trader's intentions. I was watching the ticker, the news feed and for any other piece of information that could help me not so much make money but avoid getting run over. If you picture the floor trading scene from the movie Trading Places, there were days where that was probably a pretty good re-enactment.
I wrote all that to lead up to the conclusion that those pictures are depicting real life. I do not know most of those brokers specifically, but they fought hard all day for themselves or a client. A straight down move of 800 points means that someone lost money. Maybe it was their own, maybe it was a long time client's. We live in an almost capitalistic society. The economy is driven by profits and losses, by spending and by services. For people whose income is not a salary, who everyday look at their "sheets" to see how good they were that day or the day before, it can be emotional. I look back at the best trade I ever made (as opposed to the best position I ever had -- long lots and lots of puts in the 1987 crash) and that trade was actually a losing trade. Repeat, my best trade ever was a losing trade. It was, to me, a great trade because if I did not take that exit door at that time, I would have lost six figures instead of the low 4 figures I did. Trading is having a big enough ego to know you are right while at the same time having a big enough ego to admit when you are wrong.
Those pictures show true emotion of people who were fighting for a living that day under those circumstances just as the picture of the soot covered firefighter after the California fires show their emotion of doing their job. It represents the overall mood. I could go on for pages about floor trading, the markets and the like. It is hard to appreciate until you live it for a while.
Parenthetically, options is a zero sum game. For every dollar lost, there is a dollar made. Theses photos often show the reaction that fits the direction of the market with the underlying assumption that most people are long (and not short), but if they took a picture of me in 1987 when no one was looking, I had a look of relief and, frankly, happiness. Maybe even a smirk or smile. I made really good money that day. I am not sure what posting a picture today after today's rout of someone who was short would convey other than they were short and made money.
I am not an editor or a reporter so I do not know the intent of the pictures, but if a picture is worth a 1,000 words, when I see those pictures I am immediately brought back to the feeling I had on many days in the pits.
posted by AugustWest at 7:48 PM on December 4, 2018 [40 favorites]
The act of simply being on the floor as your workspace is challenging. I stood in pretty much the same spot from 8:15am CT until 3:15 CT without a break. Often, I was screaming across the pit to make a trade via voice and hand signal, itself with its own inherent risk of an outrade or DK (Don't Know). I was pushed, bumped and stepped on. Admittedly, I probably pushed, bumped and stepped on others. It was physically exhausting especially on days like today. It was also mentally draining. I was doing calculations in my head continuously. I was trying to read other trader's intentions. I was watching the ticker, the news feed and for any other piece of information that could help me not so much make money but avoid getting run over. If you picture the floor trading scene from the movie Trading Places, there were days where that was probably a pretty good re-enactment.
I wrote all that to lead up to the conclusion that those pictures are depicting real life. I do not know most of those brokers specifically, but they fought hard all day for themselves or a client. A straight down move of 800 points means that someone lost money. Maybe it was their own, maybe it was a long time client's. We live in an almost capitalistic society. The economy is driven by profits and losses, by spending and by services. For people whose income is not a salary, who everyday look at their "sheets" to see how good they were that day or the day before, it can be emotional. I look back at the best trade I ever made (as opposed to the best position I ever had -- long lots and lots of puts in the 1987 crash) and that trade was actually a losing trade. Repeat, my best trade ever was a losing trade. It was, to me, a great trade because if I did not take that exit door at that time, I would have lost six figures instead of the low 4 figures I did. Trading is having a big enough ego to know you are right while at the same time having a big enough ego to admit when you are wrong.
Those pictures show true emotion of people who were fighting for a living that day under those circumstances just as the picture of the soot covered firefighter after the California fires show their emotion of doing their job. It represents the overall mood. I could go on for pages about floor trading, the markets and the like. It is hard to appreciate until you live it for a while.
Parenthetically, options is a zero sum game. For every dollar lost, there is a dollar made. Theses photos often show the reaction that fits the direction of the market with the underlying assumption that most people are long (and not short), but if they took a picture of me in 1987 when no one was looking, I had a look of relief and, frankly, happiness. Maybe even a smirk or smile. I made really good money that day. I am not sure what posting a picture today after today's rout of someone who was short would convey other than they were short and made money.
I am not an editor or a reporter so I do not know the intent of the pictures, but if a picture is worth a 1,000 words, when I see those pictures I am immediately brought back to the feeling I had on many days in the pits.
posted by AugustWest at 7:48 PM on December 4, 2018 [40 favorites]
See also this excellent comment about life on a commodities trading floor.
posted by mandolin conspiracy at 9:50 PM on December 4, 2018 [1 favorite]
posted by mandolin conspiracy at 9:50 PM on December 4, 2018 [1 favorite]
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