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27 February 2019

From Client Liaison to Bitcoin



This article was written by David Gaddes. All views and opinions expressed are strictly his own.


I would like to offer belated New Year greetings to all. I wish everyone a healthy and happy 2019. Let’s forget the prosperous bit. If you are healthy and happy, who needs prosperity?  

In September of this year I shall have spent 50 years in the metals industry.  I have ample memories to write a book and I shall do so but I have yet to decide when and about which period.  A friend once told me that I should not write a book expecting to make money, and he is right. I am going to write it to enjoy myself. I have had a great time and met some wonderful people and I shall certainly enjoy writing it.  I hope my novel will make a lot of people laugh and not just those in metals who have provided me with the funniest of times.

When I started in 1969 the industry and the world were very different places.  To begin with, there were no computers - only ledgers - and everything was done by hard copy.  There was no internet. There were no emails or even facsimile machines, just telex machines. Physical contracts were usually confirmed by telex with a hard copy contract to follow by airmail.  I remember going to our telex room at my first job and complaining to a lady from Colchester about a telex she had just sent.  I was only 17 and I said to her rather timidly “I think you have sent this contract confirmation to the wrong client. It was meant to go to Moscow and you have sent it to East Berlin “. She gave me a wonderful response as she swivelled on her chair.  It was one of those chairs that you could swivel 360 degrees on if you were bored. She often did. She said “That’s close enough, ain’t it?”. She was probably right. East and West were still going at it hammer and tongs during the Cold War, so I am quite sure that anything sent to East Berlin crossed a desk in Moscow. I just hoped it was the right desk.

When I first started trading physical metals I could not access information on producers and consumers by “googling” them. If they were not in the Metal Bulletin’s ‘Non-Ferrous Metal Works of the World’, I used to go to the metal development associations in the West End or visit the City Business Library in the Barbican and spend hours in those places. 

LME contracts were hard copy originals with a confirmation slip at the bottom which was to be torn off, signed and returned by the receiving party. The contracts were colour coded, for example blue for lead and yellow for zinc. When I was an LME clerk, I remember sitting with piles of LME contracts and checking that the details were correct. If they were I initialled them and gave them to a higher authority to sign. 

My first office calculator was made of metal and had levers and a handle. It was probably purchased in a job lot from a spring cleaning at Bletchley Park. So much has changed in 50 years. We have gone from client liaison to bitcoin in the blink of an eye. One thing is certain. It would not be possible to include it all in one book so maybe I’ll have to write a few depending on the reaction to the first one.

Whilst I have not decided upon which period it will be set in, I am fortunate to have all of those years of experiences as a physical trader and LME broker. It will be fiction and I do plan to keep the technical jargon to a bare minimum.  I want readers to laugh, not fall asleep. Not so much “give 4, sell at 6” but more “stick a………..cherry in it”. I want people from all walks of life to enjoy it. My writing will no doubt be supported by my time spent in Eastern Europe. It was not always easy or funny, but when it was funny it was hilarious. 

I once attended an office in Eastern Europe and at that time it was still the annual plan of the industry to sell the export production at a price above the average base price of the year quoted on the relevant Exchange or trade publication. This was extremely important. I entered the office of the boss of one such company to find him disconsolately sitting at a desk with his elbows on it and head in hands. He looked extremely tired. He raised his head and we exchanged greetings and I asked him if he was OK . He told me that he had spent the last six months explaining to a relatively new member of his staff how important it was to sell at an average sales price that was above the average exchange price of the year.  So I said to him:  "What is the problem ?”. 

His reply made me laugh. It was probably not the right thing to laugh at that time, but I just could not help myself. With incredulous wide eyes he said “I just called that person into my office and asked him why he has just sold material way below today’s price level and lost us thousands of dollars, and he said that he was following my instructions. I asked what kind of instruction I could possibly give that would lead to such losses. He said, you told me to sell material higher than the average price of the year and I did. The average of the year so far is below the price I sold at”.  Sadly the exchange price on that day he sold the material was above the price he sold at.  

Well, you have to laugh, don’t you? That is what I mean by keeping the technical jargon in my book to a bare minimum. There are a lot of people who are not in our industry who would not understand that story. Then again there are a lot of people IN our industry who would not understand that story.  So that is my New Year resolution.  “Keep the technical jargon out of your manuscript”.  Mind you some of the things I have witnessed relating to chartists and moving averages are hilarious. I might change my mind. 

Enjoy 2019. 

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