Out of the Pits: Traders and Technology from Chicago to London [Hardcover]

Caitlin Zaloom (Author)

Book Description

Publication Date: November 1, 2006

From New York to Singapore, from Chicago to London, the trading floors of the world’s financial markets are icons of global capitalism. Images of them are used on the news all the time—traders burying their heads in their hands when the market is down, their arms flailing in a frenzy when fortunes are rising—to convey the current state of the economy. But these marketplaces, and the cultural life that sustains them, are dissolving into the ether of the digital age: powerful financial institutions are shutting down the trading pits, replacing face-to-face exchanges with an electronic network where traders sit, face to screen, finger to mouse, and compete in a global arena made up of digits and charts. 

Out of the Pits considers the implications of this sea change for everyone involved, from the traders and brokers to the market as a whole. Caitlin Zaloom takes us down to the floor at the Chicago Board of Trade and into a digital dealing room in the City of London. Drawing on her own firsthand experiences as a clerk and a trader and on her unusual access to these key sites of global finance, she explainshow changes at the world’s leading financial exchanges have transformed economic cultures and the craft of speculation; how people and places are responding to the digital transition; how traders are remaking themselves to compete in the contemporary marketplace; and how brokers, business managers, and software designers are collaborating to build new financial markets. 

A penetrating and richly detailed account of how cities, culture, and technology shape everyday life in the new global economy, Out of the Pits will be must reading for business buffs or anyone who has ever wondered how financial markets work.

Editorial Reviews

Review

"Zaloom''s superb book is a double-site ethnography. She first worked as a runner on the Chicago Board of Trade. . . . The appearance of chaos hid a complex social order, which Zaloom delineates beautifully."—Donald MacKenzie, London Review of Books

(Donald MacKenzie London Review of Books )

"A fascinating story, likely to be engaging not only for sociologists, particularly those interested in markets, but for other social scientists and nonacademic audiences as well."—American Journal of Sociology

(American Journal of Sociology )

"Zaloom''s account of the social world of the pits . . . demonstrates interpretive skills reminiscent of classics of cultural and economic anthropology. In this book, she has provided an empirically rich and theroretically sophisticated ethnographic account."—Theory and Society

(Theory and Society )

"In her brilliant qualitative study . . . Zaloom makes a strong case for the relevance of cultural analysis in extending our understanding of the functionality and evolution of organized markets and exchanges. Her excellent achievement demonstrates the power of interdisciplinary approaches in extending the scope and the richness of scholarship in business and economic history."—Business  History Review

(Business History Review )

About the Author

Caitlin Zaloom is a cultural anthropologist and assistant professor in the Department of Social and Cultural Analysis at New York University. Her research on traders and technology has been featured in the New York Times and on the BBC.

Product Details

• Hardcover: 240 pages
• Publisher: University Of Chicago Press; 1 edition (November 1, 2006)
• Language: English
• ISBN-10: 0226978133
• ISBN-13: 978-0226978130
• Product Dimensions: 9.3 x 6.3 x 0.8 inches
• Shipping Weight: 4 ounces (View shipping rates and policies)
• Average Customer Review: 4.0 out of 5 stars  See all reviews (3 customer reviews)
• Amazon Best Sellers Rank: #921,826 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

2 of 3 people found the following review helpful:

5.0 out of 5 stars It's Time to Evolve, August 17, 2007

By 

takingadayoff "takingadayoff" (Las Vegas, Nevada) - See all my reviews
(TOP 1000 REVIEWER)   

This review is from: Out of the Pits: Traders and Technology from Chicago to London (Hardcover)

The pit trader postures and screams to establish dominance. He uses physical and psychological intimidation to scare off potential competitors. A certain amount of cooperation and even trust is necessary for him to be successful. It's surprising that Jane Goodall hasn't seen fit to study these young primates.

Caitlin Zaloom, a cultural anthropologist, lived among the savages at the Chicago Board of Trade (CBOT) and the London International Financial Futures Exchange (LIFFE) for several years, long enough for them to become accustomed to her presence and even, to a point, trust her or at least ignore her. A woman in the trading pit is about as rare as a human living among the gorillas.

There are some pretty compelling reasons to study the trading pits. They are disappearing and soon most trading will be done electronically from all over the world. Traders won't be in the same room with each other and shouting will get you nowhere. How will this change trading? Obviously a loud voice will no longer give a trader an advantage, but will being an alpha male still be a plus?

Zaloom looks at the traditions of traders, the architecture of the trading space, the traders' clothing and habits, how traders get their jobs and how they're trained. She learned the techniques of traders and she became a trader. It's a short book (177 pages of text plus excellent and detailed notes, bibliography, index, and photos), but it covers a lot of territory. The style is often academic, with references to Michel Foucault, for instance, but on the other hand, these are pit traders we're talking about, so you'll have to pardon their French. Zaloom describes an especially colorful London trader, Freddy, who wears khakis with holes in them that show his underwear. He picks his nose, flashes the pit, and sings and barks loudly. It's hard to imagine how the markets will survive without him.

1 of 2 people found the following review helpful:

4.0 out of 5 stars Out of the Pits: Traders and Technology from Chicago to London, December 20, 2007

By 

C. Joyce (Pennsylvania) - See all my reviews
(REAL NAME)   

This review is from: Out of the Pits: Traders and Technology from Chicago to London (Hardcover)

Interesting book, well written. Covers trading from an integrated point of view about how technology, money and other events interconnect. Gives trading a human touch. Glad I have the book.

0 of 1 people found the following review helpful:

3.0 out of 5 stars Need to re-read, August 26, 2009

By 

Roman Weissmann "Roman" (Barcelone, Barcelone Spain) - See all my reviews
(REAL NAME)   

This review is from: Out of the Pits: Traders and Technology from Chicago to London (Hardcover)

There are books that you read in 5 hours. This is not this kind of book.

If you know nothing about trading floors and you want to learn about them, this is not your book.

I'm an economist but studying an anthopology degree so I was really eager to read this book coming from a well known anthropologist talking about finance.

First, it describes the history of the 1930 CBOT building (built to foster the trader's spirit and to improve competitivity and achieve a perfect market). Then Zaloom explains the difference between an open-outcry trading (Chicago) and the online trading (being launched in London at the time) and all the related problems that this "fight" originated mainly in the "being" and how the market was being reshaped.

Her description of the American Man is extremely technical (I mean, she uses too much "philosophical" concepts-if you are not an expert you will have problems). The rest of the book revolves around the fight between the old trading method (still working in Chicago) and the new one, the electronic trading platform in London.

Finally, the book has too many footnotes (take into account that the book has 177 pages and 30 pages of notes); sometimes is difficult to follow because in the same page, for example page number 113, you find 7 footnotes!.

Maybe it's because I have never read a book like this before, but I will need time to process and likely, to re-read the book to fully absorb it true spirit and new vocabulary (rationality, being,barrow boys,...)