Wednesday, May 9, 2012

The Pit - movie

Last night I watched The Pit which was filmed at the NYBOT and focused on the coffee pit from around 2006 to the closure in the floor in 2008.  The hour long movie isn't out on distribution beyond Netflix so streaming it off of that is the only way to see it beyond the occasional PBS or film festival screening.

Overall it was a great movie and showed a lot of angles of how the pit operated and also how difficult the impact of the trading floor closure was for a lot of participants, specifically the brokers.  The characters in the film were well picked and made it entertaining for viewers to understand the broad cross section of flamboyant personalities which were not just on the NYBOT but every trading floor.  However I was really surprised the film featured an openly gay floor trader because I've never heard of one anywhere else.  What I felt was missing was the high rolling local traders because knowing their personality, they're the types to keep quiet and wouldn't open up their lives like the film's characters did (although the gay guy seemed to be trading well).

I'm also glad that The Pit featured a few characters who drifted in and out of the floor after giving it a shot as in reality that was incredibly common..  A couple characters worked part time jobs at night while they were trading during the day and I've never seen that work out for a trader.  The great irony is that entry level traders/clerks looking to trade were usually paid to the bare minimum to survive and the 'payout' was getting a chance to trade down the line which, in Chicago terms, usually meant the backer would stomach a 50-100k drawdown in the process if necessary.  I remember when I spent a week at NYMEX that the clerk I 'worked' with was paid $2000/month which meant he had to live in a Jersey City ghetto and was incredibly stretched to even buy food.  Similarly to get on track to trade w/a small group of locals, my pay went from $3000/month as a phone clerk to $1800/month but luckily I was 20 at the time so it wasn't a problem.

A point which really came across in the film is how many people go into trading just to make money and only tolerate their discomfort in hopes of achieving that goal.  The pursuit of money turns people miserable and it's clear why a lot of characters didn't stay in the game when the money dried up.  It takes a love of the process, continually seeking knowledge, matching wits against the market and building a life as a sovereign individual to hand the ups and downs while those in it solely for the money leave to chase another dream if it's not immediately monetarily rewarding. 

Although I'm a fan of The Pit, my opinion is that Floored is a better overall movie but both do a great job capturing the trading pits on film.  Hopefully wider distribution comes for The Pit but for me it was worth signing back up to Netflix just to watch it until it comes on DVD as well. 
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