[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]
Re: Do the Right Thing
Responding to msg by [email protected] () on
Mon, 4 Dec 1:42 AM
>That authority now sits in other hands. In silicon.
>I doubt the President wants a market meltdown as we
>start to move towards an election year. Body bags and
>a bad economic front are a bad mix and could swing the
>whole election with the dual near unsurmountable
>Hopefully, god-willing, we won't face any tragedies.
Financial Times, Dec 4, 1995
US Marine chiefs trade places to experience tranche warfare
Officers are preparing to do virtual battle in the Nymex oil
pits [and wargame FinCide]
By Laurie Morse
A dozen US Marine Corps generals and colonels will today march
on to the New York Mercantile Exchange trading floor and start
matching wits with commodity futures traders.
The traders often describe their fraught existence in the
trading rings as virtual warfare, and the US military appears
Keen to find ways of training officers to cope with the
demands of high-tech 21st-century warfare, a group of Marine
Corps top brass will venture into the Nymex crude oil pit in
the World Trade Center after the regular market has closed.
Assisted by a group of handpicked veteran commodity traders,
the marines will plunge into a simulated session of futures
trading that will include several market reversals and a
barrage of oil-linked "news".
Mr Gary Lapayover, the Nymex trader co-ordinating the event,
says the trading session will allow the officers and traders
to become acquainted on friendly turf, and give the Marines a
glimpse of the multiple tasks and the speed -- that breakneck
Today's simulated trading will be followed tomorrow by a war
games session. About 15 traders will follow the generals to an
old officers' club on Governor's Island, off Manhattan, and
test their skills in a computerised game designed by Gama
Corp. a Virginia-based company that specialises in
computer-generated battle scenarios.
Later, the traders will tell the officers and their aides what
they think of the battle experience.
What do the Marines hope to learn from the commodities pits?
"Our vision of what warfare will be in the 21st century is
very different from what we've faced in the 20th," says
Colonel Tom Harkins, director of operations at the Marines'
war-fighting laboratory in Quantico, Virginia.
In future, the Marines expect to be drawn into smaller
conflicts of the type seen in Somalia and Bosnia. At the same
time, warfare will become increasingly digitalised, calling
for rapid decision-taking amid a barrage of information.
"How does a commander make decisions on a digital
battlefield?" asks Col Harkins. "Technology will increase the
tempo of battle, and the influx of digital information will
require skills in what you might call pattern analysis. This
is what futures traders do. In this exercise we want to see
how people who face these conditions every day deal with the
stress, and get comfortable with the risks."
During tomorrow's war games, traders will be confronted by an
on-screen battle area laid out on a grid, with as many as 50
small teams of cyber-soldiers seeking the "enemy".
Once "contact" is made, the teams will request firepower.
Under pressure, "commanders" must decide how to deploy
resources to the best strategic advantage, while limiting
For Mr Eric Bolling, an independent trader who has survived
nine years in the Nymex energy pits, the Marines are being
shrewd in seeking to cross laser-swords with battle-hardened
heroes of the trading pits.
Mr Bolling, a 33-year-old former minor league baseball player,
has no military background, but sees a lot of parallels
between trading, sport and the armed services. All three
require high levels of self-motivation and decision-making
Some of the generals and colonels may be shown to be more
suited to high-stress, high-stakes environments than others,
he says. "You have to be able to prioritise and analyse a lot
of information rapidly -- then initiate risk by making a
decision; and, finally, manage that risk by having the
discipline to manage the trade," says Mr Bolling.
"A lot of people can't do that, and wash out of these markets.
I don't think it's something that can be learned really --
it's a personality type."
Mr Lapayover said he selected floor veterans like Mr Bolling
to participate because he was looking for "survivors" people
who have been successful traders over a number of years.
"Military experience wasn't a factor. The Marines are looking
for people that can help them understand the process."
Mr Lapayover has also suggested that the top brass visit the
"war rooms" of America's largest investment banks to observe
Wall Street's fixed income and equities traders, and the
strategies of high-stakes corporate raiders.
The war games are part of a new programme directed by General
Charles Krulak, commandant of the Marine Corps.
"War games are not designed to give you a total solution, they
are designed to give you insight" he says. "We're going to
have our laboratory analysts with us, and they will be looking
at improving the process."