3
4
It took only a short time for telegraphy’s compression of time and space to
transform the scenery. Here’s what the
Street looked like shortly thereafter when
everybody had to have it. 2
In its day, telegraphy was seen as the
same kind of overwhelming transformation that the Internet is today. In many
ways, the telegraph was more dramatic
since it was the first time in history that a
message could be sent beyond the horizon
instantaneously.
Changes in markets brought about by
technology are anything but subtle: The
exchange floors are an endangered species. Here’s a photogenic example, the
London Stock Exchange trading floor the
day before and the day of the introduction
of screen trading — the “Big Bang” — on
October 27, 1986. 3 4
The trading floors that have been
emblematic of financial markets around
the world are an endangered species. Brokers and traders who once relied on fast
reflexes and agile elbows and knees now
5
8
6
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rely on computer programs, tweaked to
be microseconds faster than the next guy’s
program.
Closing the floor and rolling in the
machines has a sentimental cost. When
markets become technology, the human
price of progress is high. Anyone who has
been on the 20th century floor in New
York or Chicago knows those markets
are really personal, face-to-face, elbowto-elbow and knee-to-knee experiences.
People are justifiably saddened that when
too much technology gets mixed up with
markets, some of the vibrancy that makes
them so fascinating is lost.
A trading floor peopled with traders
and brokers also makes for some colorful
moments in market history, such as the
opening of the live hog futures contract on
the Chicago Mercantile Exchange (CME) in
1966. (These guys are definitely having more
fun than loading the hog program onto
a Unix box in New Jersey.) 5 The CME
continued the lively tradition for financial
futures as well. 6
There’s so much technology in modern
markets that it’s easy to forget that some
of our favorite markets, like the New York
Stock Exchange (NYSE), started out as
very low-tech places. In 1792, the NYSE
was a bunch of guys standing around a
buttonwood tree at 68 Wall Street shouting at each other on days when it didn’t
rain or snow. 7
We like our markets to be liquid, efficient, resilient [