As indicated in my previous blog, The Ericle intends to publish a series of anecdotes from his personal life – in no particular order and on no particular theme. This is the first of them – an account of my first salaried employment.
At around the age of 15, I announced to my astonished parents that I was interested in becoming a rabbi. This was greeted with as much amusement as when as a toddler, I had declared that I wanted to become a train-driver. However, this inclination towards teaching remained with me and upon the completion of my degree course, in International Relations at Sussex University, I gained a place on the Masters course in Education at Goldsmith’s College, London. My parents were aghast; protesting that they hadn’t endured the rigours of being Jewish refugees from Nazi Austria in order for their son to become a teacher. Quite why I succumbed to their emotional onslaughts and deviated my choice of career, was to become a feature of quite a few discussions with various therapists in the years to come, but succumb I did. As a result, some months later – via a sponsor, a friend of the family – in November of 1971, I joined the stockbroking firm of Dunkley Marshall & Smithers of 4 London Wall Buildings, London EC4.
I would imagine that many Army conscripts would speak of their experiences in similar terms to how I came to feel about DM&S – I didn’t ask to be there and, though it had its moments, it was mostly not to my liking but the experience was in some major part ‘the making of me’. My reference to The Army is not coincidental because the ethos & culture of The London Stock Exchange very much reflected that of the military, and as for DM&S that of the English army at the beginning of the 20th century. At its base was the demarcation between an officer corps made up mostly of Gentlemen and the mass of foot soldiers who came from Ordinary Folk. In London Stock Exchange terms this translated to Members (The Nobs to the Manor Born), Dealers (Officers who had risen through the ranks) & Underlings (Infantrymen). Despite my educational qualifications, I was definitely one of the latter.
The offices of DM&S were a mixture of utilitarian, with a splash of Dickens, and hierarchical. Worker Ants, like myself, laboured in cramped poorly lit chaotic clusters while The Partners enjoyed carpeted rooms, in which they could practice their putting, between bouts of speaking with clients and visits to their drinks cabinets. However, it was the toilet where the most telling area of social apartheid took place with Partners having their own cubicle, accessed by key. I kid you not.
The London Stock Market until ‘The Big Bang’ of 1983, (see here), comprised of Jobbers & Brokers; the latter being the wholesalers of stocks & shares, and the latter being the customer-facing retailers. My first assignment at DM&S was within Jobbers’ Ledgers, the department that calculated the balance of monies for each individual stock owed to and from the individual jobbing firms by DM&S from the previous accounting period; ‘The Account’ being the period of time, normally 2 weeks, in which shares could be traded before ‘settlement’ had to take place. It was, thus, possible to buy and sell shares within an account, without taking ownership; the buyer then being financially responsible for the difference. Clients who did this were labeled ‘Bulls’. This strategy could also be worked in reverse; selling stocks & shares in the prospect of their falling within the accounting period. Such sellers were known as ‘Bears’. Both of these financial manoeuvres – given the fine-timings involved, the ‘spread’ between buying & selling prices and the commissions – retained a high degree of risk; especially being a Bear as theoretically there was no limit to one’s risk exposure. (Think about it!). Though some Bulls and Bears were solid citizens, many or most were not – and that included me! Never really having the funds to own shares, I began to trade within accounts on the basis of the belief that I had an inside steer on matters, given my proximity to the markets. Given that my starting salary was £800 Guineas (£880) per annum, which rose to a lofty £1500, 3 years later, I was not exactly rolling in funds, despite my enjoying parental board & lodgings. If the truth be known, being a Bull – I never dared be a Bear – was a mug’s game and my adventures overall proved, at best, to be a ‘zero sum game’. However, it was when I played at being another Stock Exchange animal, that of a Stag, that I did make the odd penny. Unless one was completely idiotic, or extremely unlucky, being a ‘Stag’ was the closest thing to gaining ‘money for old rope’ on the stock exchange. A Stag was a buyer of newly issued shares about to be ‘floated’ onto the markets. New issues were invariably keenly priced in order to attract institutional investors and to get the shares off to a buoyant start when trading commenced. In a rising market, most new issues were massively over-subscribed and individual applications for such shares would be proportionally paired down to spread share ownership. Moreover most Stags, like myself, applied for many more shares than their finances could cover in the realistic expectation that they would be issued substantially less than that for which they had applied. (Later, when the Thatcher’s Tories got to power and denationalized many public assets, such issues became national ‘gold rushes’ – the most famous being The British Gas ‘Tell Sid’ denationalization). In short, Bulls, Bears & Stags were the spivs’ of the stock market & The Ericle spivved along with the best!
I spent 9 long tedious months in Jobber’s Ledgers. Every day I’d receive a stack of handwritten dealing slips from the previous day’s trading, which I’d then transcribe by hand into the ledger. At the end of The Account, using a comptometer, I had to calculate the balance owed to or from each particular Jobber for every share. I would then telephone each Jobber in turn to confirm the balances. The Jobbing firms had evocative names, some of which I can recall to this day: Akroyd, Berger, Bisgood Bishop, Pinchin Denny, Smith Brothers & Wedd Durlacher. I liked my colleagues in the department and I’d like to think that they came to like me, though they were quite definitely from a different background. The department head, Alan, was a real old lag whose mood-swings were impossible to read; definitely better in the afternoon after a lunch spent at the pub. My mates were Dave – now in his late thirties but who clearly had been a bit of a rake in his youth – and a pretty but quite large young woman, Jenny, on whom I developed a bit of a crush. When I eventually summoned up the courage to ask her out, she very politely turned me down while letting me know that she & I were ‘not really of the same sort’. A couple of months later Jenny & Dave announced that they were to get married. I don’t think I was the only one for whom this came as a surprise! After a couple of months in Jobbers Ledgers, I began to anticipate that inevitable moment when The Senior Partner, would pass by the department, and seeing me there, declare: “Wilton, what are you still doing in Jobbers’ Ledgers? A man of your talents needs to be doing a lot more than copying transactions and calculating balances. We need the likes of you on the floor of the exchange.” After 6 months or so, it became clear to me that this moment would not arise of its own accord and that I’d be left there till the proverbial cows came home. My lobbying to move on after 6 months did not exactly ingratiate myself with my colleagues, most of whom had spent a decade or more in the department but eventually, mostly due to the support of my sponsor, I managed to segue myself in the direction of the stock exchange floor; as first as a Red Button (working in an anteroom of the Exchange, confirming the previous day’s trades) & then as a Blue Button.
The hierarchy of buttons on the London Stock Exchange were: Silver/Members, White/Professional Dealers & Blue/Non-dealers. A Blue Button’s job was to run around the exchange checking on prices prior to a dealer making a potential transaction. The aptly-named Squirts Guide was the Blue Button’s bible as it gave him the names of all the jobbers dealing in particular stocks & shares. (And there were only males when I started. However, women were admitted during my brace of years on The Exchange on the 26th of March 1973: see here). The Exchange marched on formality. At first glance, this may have seemed as quaint for the sake of peculiarity, but in reality it was the formality that made The Stock Exchange’s motto, “My Word Is My Bond”, stick. Dark suits & black shoes were the required uniform, excepting the Government brokers who wore top hats & tails. Shoes had to be shined and suits pressed. Extreme politesse & care with the spoken word was de rigueur with a huge amount of formulaic language being deployed. When asking a price off a jobber, one was given 2 prices – the lower being the selling price and the higher being the purchase one. So a dealer with an order to buy shares of XYZ at 65p could be told the price as “64-66”. He might then intone that he had an order “in the middle” The jobber then had the option to accept that price or to offer an adjusted price to say 65-66, which would have been no help. On the other hand if a price quoted was 64-65, the broker would be obliged to trade. If it ever transpired that a broker traded elsewhere on the back of having ‘opened’ a jobber, his name became mud.
Unsurprisingly, given the large number of dealers who were ex-servicemen, the culture of The Exchange was very much cast in the military mode. This included a HUGE amount of playground humour, drinking and picking on the lowest in the pecking order. On returning from lunch, on my first day on The Exchange, there was a note left for me to check the market thoroughly for the price of R. Supwood. Not finding R. Supwood in my Squirt’s Guide, I asked the dealers which jobbers sold the shares, to be informed that this was a new share on the market and that I needed to check with all the jobbers as to whether they dealt in the shares. So yours truly did check with every jobber asking: “Excuse me, Sir, do you deal in R. Supwood” to which I received a number of rather robust replies! It was childish humour, of course, aimed at causing a rookie the most possible embarrassment. However, as a means of introducing a newbie to the market it was priceless. Giving the Blue Botton a cruel nickname was another favourite wease. Given the size of my proboscis, I quickly was rechristened as Nellie; a name I had to endure for the duration of my stay on The Exchange.
Being a Blue Button was exhausting work. It was my everyday responsibility to haul the dealing boxes from the office to The Exchange and back in the evening to enable after-hours trading. My days were spent answering phones & ‘squirting around’ chasing prices. In between times, I had to keep the dealing room blackboard up to date with prevailing prices plus chase down dealers from the various Throgmorton Street pubs when their services were required. It was complete mayhem at many times but never boring. It also had moments of high excitement such as the volatility that accompanied surprising major political or economic news. I remember well the wild trading that accompanied the news that the UK was leaving The Gold Standard, when gold mining shares – the most notorious being Poseidon – were traded from pennies to pounds in a matter of moments.
I left the London Stock Exchange and DM&S in June of 1974. My reason for leaving was not that I didn’t enjoy the job but rather that the market was in the doldrums and I had decided to take a sabbatical in order to travel. I fully intended to return and seek a dealer’s position as soon as the market improved. Events took me elsewhere, but that’s a story for another day.