This book by Caitlin Zaloom is an anthropological study of markets and traders’ practice, that also investigates the effects of digitization has had on the field. It is a very interesting and deep study of a field that seems to have reached a local optimum. It shows how the physical configuration of space hindered the development of pure markets (not all sellers and buyers could see each other - making cliques that settled in different prices). Another interesting point was the fact the way risk regulated both the market and the people in it. People take risks in order to gain financially, but were also expected to constantly get greater risks (”grow”) in order to rise in status in the trading pit. But people also make seemingly irrational moves (lose money) or going against the market in order to get better trades in the long run, as a trader explains:
This happened to me the other day. I got an order to sell from a big local trader in the pit who I have a great relationship with. He [the local] bought it from me at the high[est price] of the day. I know he didn’t make any money on that trade. The next time I get an order to sell and there are a bunch of people who are bidding together, well, I’m going to remember that he bought it from me up there. So if I have to pick someone out of the litter, maybe I’ll pick him…There is a lot of discretion.
The fact that these people’s gains and losses are dictated by the abstract (and higher-level) market has led some of them to use religious language when referring to it and they must create and maintain a monk-like discipline that will allow them to function more efficiently in the market:
First, traders separate their actions on the trading floor from their lives outside; second, they control the impact of loss; third, they learn to break down the continuities between past, present and future trades by dismantling narratives of success and failure; and fourth, they maintain acute alertness in the present moment.
This discipline enables them to create a coupling with the market entering a state of flow, or as a trader mentions (p. 128): “…you can experience the market and become a part of this living thing”.
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