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John Bruch wrote:
> "nwinski" <nwinski@xxxxxxxxxxxxxxx> wrote:
>
> << They stand there with no desk, no cushy chair, no computer, while being
> on an adrenaline edge, screaming their brains out, and fellow traders,
> spitting in their face, stepping on their feet, jabbing them in the ribs,
> seven hours per day. I do not begrudge them one penny for whatever money
> they make in accordance with the rules. Then provide a valuable service in
> TAKING THE OTHER SIDE OF YOUR TRADES.>>
>
> Norman,
>
> I have great respect for your opinion. Perhaps I do not understand what you
> are saying... Are you saying that the purpose of open outcry is to provide
> a market? If you are, then I disagree. Markets can be provided
> electronically... After all, there is always someone to take the other side
> of my NASDAQ trades. No, I really can't give credit to locals (floor
> brokers/traders) for taking the other side of my trade.
>
> The purpose of open outcry is, and always has been, to provide market
> "transparency". That is, to force buyers and sellers into the light of
> day - to force them to state their prices publicly by shouting their bids
> and offers for all to hear. That is the current and historical reason for
> open outcry markets.
>
> John Bruch
John,
Thanks. Yes, a marketplace can be provided by many different types of
mediums. Only a centralized
trading pit environment can provide that extra emotional intangible factor that
provides the best liquidity.
There is a group dynamic generated in a trading pit that can not be reproduced
anywhere else. Imagine yourself in a trading pit jammed with 100 traders, ad you
are trading for your own account. A broker
ask for a market and 100 voices compete to be first with the highest bid and the
lowest offer. It is a split second response. The response from the market
participants is instantaneous. Don't you think, with all that intense emotion to
offer the best market, that the customer is going to benefit?
Intensely,
Norman
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