Story from the Pits ( Cool Hand Luke)

I miss the Pits! It was a world unto itself. In many ways, it was an extension of High School, maybe that’s what I liked about it. My time spent there (I promise it wasn’t prison) was from 1982-2004. I forget the exact years, but for a 2-3 year period in the 90’s, I was trading in the Micron Technology pit. That is the setting and time period of this story. Our firm, Mercury Trading, was the specialist , responsible for law and order in the pit as well as being the lead market maker. Pete Najarian ( CNBC’s Fast Money ) was our lead trader in MU and I was in there with him. MU was one of the most active stocks during this period, and many days between Pete and I, we would trade over 30,000 contracts ourselves. Most days were very active with few slow moments. But some days were slow and torturous! But we never knew when things would pick up, so just like war, we sat there and waited. It was one of those slow days where this story takes place.

The main character in this story is Barry. He was an assistant (clerk) for one of the main Brokers in the pit. The main Broker in the pit was a guy named Pete from Brooklyn. He easily was top 3 for the naturally funniest guys I have ever met in my life. I might talk about him in a future blog. Barry was a fascinating kid, maybe 21 years old at the time of the story. He was a hustler from the word Go. Barry was just trying to supplement his modest salary with side activities. Extremely likable! If you needed tickets to any event in Chicago, Barry was the guy. With Micron one of the busiest pits, breaks were few. Have no worry, Barry had bananas, apples, and other fruit for sale in the pits as well as bottled water. Pure entrepreneur, you had to love it!

One day, I looked over at Barry and saw him in deep thought. I knew he was up to something, probably a way to make a few bucks. Next thing I knew, Barry blurted out, "I bet I can eat 7 Big Macs in half an hour"! You could see the excitement in his face, he was a junior Kool Hand Luke in the making! At first, there was a calm quietness in the pit of 30 traders as they digested the challenge from Barry. Within 2 minutes, as if they were responding to a trade, the traders countered. Fast and furious activity followed, with traders in heated arguements whether he could or couldn’t accomplish this worthy food challenge. Traders from other pits got wind of this and in a short time, our pit was flooded with activity. An onlooker from the visitors gallery might look down at the pit and think there was lots of activity. They were right, it just wasn’t options trading. There are rumors about the amount wagered on this eating event, but that type of activity is not allowed on the floor 😉 I think for this event, I was Barry’s George Kennedy, in the movie Kool Hand Luke, George Kennedy manages the challenge. I think I got the job by default since I stood next to Barry in the pit. I really liked him and wanted him to do well, but was concerned for him.

The scene of the eating challenge usually took place in the members cafeteria, located above the trading floor (eating on the floor was not allowed either). Throngs of well wishers and traders with a vested interest in the event all converged on the escalators and headed up to the cafeteria. Everybody took seats around Barry. The moment of truth finally arrived with the food carefully placed in front of Barry. He looked confident and loved the excitement.

The first 3 sandwiches went down almost too easily, Barry looked great and very confident. The momentum seemed to be with Barry. The 4th sandwich went down slowly. The 5th sandwich was the turning point. His facial expression was not good and his confidence disappeared. Midway through the 6th sandwich, Barry paused, and, well…… you can guess the rest. It was an ugly, ugly site! The thrill of victory and the agony of defeat, this was definitely the agony of defeat. Traders and onlookers quickly settled up and went back to the pits. Barry was alone and suffering. My heart went out to him, he gave it his best shot! I tried to give some comforting words to him, but nothing could console the pain he was in. Another day in the pits, Oh how I miss it!

Be careful how much you eat this weekend!