Mad (Grateful) Men (& Women)

“This is America. Pick a job and then become the person that does it.”

-Bobbie Barrett (Mad Men, Season 2, Episode 5)

Twenty-six years ago, I took a job as a clerk for a Chicago market-making firm. I didn’t know much about the role, but I was eager to learn, and able to live on $24,000 a year. Each morning, I coaxed my aging 1973 VW Beetle to the train station in the western suburbs, showed up, asked questions, and slowly sharpened my understanding of derivatives. The late 90’s bull market created opportunity everywhere, and by early 2001 – despite a sharp turn in market sentiment – I earned my chance to make equity-option markets.

Gratitude

“I am grateful for what I am and have. My thanksgiving is perpetual. It is surprising how contented one can be with nothing definite – only a sense of existence…O how I laugh when I think of my vague, indefinite riches. No run on my bank can drain it, for my wealth is not possession but enjoyment.”

– Henry David Thoreau

The power of gratitude is well understood, but it’s hardest to practice in moments of upheaval. Thoreau wrote his famous passage more than 160 years ago during another period of rapid change. The second industrial revolution upended familiar trades and reshaped global commerce. Today’s world feels similar. The pace of technological change can be disorienting, even when it ultimately creates new forms of opportunity.

The last great technological shift – the late 90’s and early 2000’s – flattened countless industries. Derivative trading moved from a physical, insulated craft to a digital and democratized ecosystem. My role became largely obsolete as systems learned to update values and hedge deltas faster than any human could. I wasn’t alone; assembly lines automated, bookkeeping digitized, journalism centralized, and entire service industries were redefined.

In my mind, there was little that set me apart from the thousands of other one-time floor traders. What I didn’t understand was how the cottage industry of derivatives trading could blossom into a driving force in capital markets. We often underestimate the value of our experience.

Valuable Human Experience

As regular readers know, average daily options industry volumes moved from 2 million to over 60 million in the 21st century. Despite 2,900% growth, technology made managing that risk transfer far more efficient.

I recognize that my written output will never be ‘better’ than something generated by a large language model. I had to look up the dates and transformations for each industrial revolution. I’ll lean on a thesaurus to avoid repetition. My process is inefficient, but it’s sincere, sometimes creative, and human.

I’m grateful for friends who understand the incredible power of machines and continue to focus on the value of the human. The process of learning is powerful despite its shortcomings. On this point, I recommend readers follow Dr. Liz Gerber. She understands the capabilities of complex technology but remains a staunch advocate for the overwhelming value of the individual.

For those interested in deep market analysis by a man willing to interrogate every number and assumption, you must follow Mike Green. His thoughts on markets often require a second or third reading. He has an uncanny ability to take on big concepts and break them down with brevity of language. There’s not a wasted word.

His work is increasingly focusing on the broader social contract. Mike’s ability to synthesize decades of data and address fraught political topics in a polarized age is unique. His last three efforts (Pandora’s Ledger, Are You and American, and My Life is a Lie) remind me of the Beatles string of albums from Rubber Soul to Sgt. Peppers. One better than the other. For the Stones fans, it’s like Let It Bleed through Exile on Main Street. Enjoy!

Bringing It All Back Home

We’re now living through the fourth industrial revolution. Modern technology has “connected” people and things. We can edit genes, robots are filling consumer baskets from remote warehouses, and we’re able to (re)watch Mad Men with the click of a remote. Perhaps we’re also on the cusp of generative artificial intelligence.

In many ways, our lives continue to improve. Equity markets have boomed for the better part of three years. It’s a halcyon era for options users. The demand for exposure to U.S. equity markets, and particularly the Nasdaq-100 Index (NDX®), is pervasive. I’m grateful for all of it, but I also recognize that lives are not improved uniformly.

This Thursday, and going forward, I give thanks to my family, friends, and colleagues for supporting me since before there were yottabytes of data to feed LLMs. I’m profoundly grateful for those very human, non-digital relationships.  Every industrial revolution to date has been engineered by humans. That remains true in the 21st century.

This is still America. My hope is that it remains a place where opportunity and ambition meet, where anyone can choose a job, grow into it, and become the person who does it.