Trading: What happened when the pit stopped

> By her twenties, Ms Rifkin, who did not finish high school, was earning six-figure pay.

I've never heard anyone call pit trading a meritocracy but it was one job where people who didn't have the best pedigree could still get a very good paying job. As is pointed out every day there are fewer and fewer of these types of jobs around anymore in the North America. I think real estate agent and sales are the two jobs that immediately come to mind as jobs that people who don't have a university education can still make great money with.

> Electronic futures trading arrived in 1992, when the Chicago Mercantile Exchange launched its Globex technology. Nymex followed a year later with Access, short for American Computerized Commodity Exchange System and Services. But access to Access was confined to hours when pits were closed, to protect the value of seats on the floor, Mr Collins says.

Even when given an, IMHO, obviously superior technology the incumbents were able to hold it off for the better part of a decade. I always try to keep this in the back of my head when trying to predict curve jumping shifts in behaviour, just because you think something is superior to the incumbent you can't assume that it will immediately replace it. Or put another way its dangerous to short the incumbants on the thesis that new tech will immediately replace them, the old guard can be very sticky.

> GEM’s 17th floor office off Columbus Circle in midtown Manhattan contains just five traders on a recent afternoon, with a few more patched in by video feed from offices in Chicago and Dublin. The room is quiet but for the hum of the air conditioner, brokers quoting oil structures over speaker phones and the bleep of trades being executed, often driven by algorithms.

> Mr Vonderheide’s employees studied physics, economics, chemistry and finance at top US universities

> “A friend used to say, ‘If I weren’t trading gasoline, I’d be pumping it’. Well, some of them are.”

These are the people who replaced the pit traders. If you contrast them, a successful pit trader tended to be loud, big, boisterous and outgoing. When a shift does happen as the shift from pit to computer did, the new guard tend not to resemble the old guard very much and the old guard tend not to fair very well.

It fails to ask a number of key questions like:

1. Why unskilled random people were able to earn significant money as traders? Why is their background an excuse for inequality they were part of?

2. Who was financing their crazy earnings? Surely money didn't appear out of thin air?

3. What was the motive to hire those random people? My best guess: whoever was sponsoring their seats wanted to have a trusted partners to gather intel / pull of a scam. Either way, not exactly pretty.

4. Who exactly is now profiting instead of the old traders and how does it affect the other participants of the market?

I do wonder which PR company is behind this article and what is the ultimate motive of their client.

EDIT:

A) Forgot to add the note about deceitful graph of "New York City jobs ..." which looks like the number of jobs goes almost to zero, except it has a base level of 90k.

B) Interestingly Mr Ardizzone was sued in 2011 for an alleged scam [1]. This would support my guess from point 3.

[1] http://www.reuters.com/article/us-arcadia-lawsuit-idUSTRE74P...