Thursday, June 03, 2004

Trader Tapes
The tv in the gym where I work out was tuned to CNN yesterday morning, when they reported on the taped conversations between Enron's electricity traders and others during the California Electricity Crisis of 2001. Some of the comments captured on tape were startling, others merely vulgar.

Many companies routinely tape record all conversations on traders' telephone lines, in case of subsequent disputes over the wording of transactions, so the traders are fully aware they are being recorded. That makes these remarks even more surprising and symptomatic of a toxic corporate culture.

As you know if you've been reading my blog for a while, I spent about ten years of my career in energy trading, handling both physical petroleum commodities and petroleum futures and options. For part of that time, I supervised a small trading operation. I can only say that if any traders that worked for me had ever uttered the kind of things these tapes captured, they would have been disciplined or worse.

When I began trading in the mid-1980s (before taping), my supervisors always impressed upon me that I was a public spokesman for my company, and that I should never say anything that I wouldn't want to read on the front page of the paper. That seemed eminently sensible, and it stuck with me. Now it's true that traders tend to be a boisterous lot, and the humor can sometimes get a bit raw, but the remarks I heard this morning went beyond anyone's idea of a joke. Once again, the arrogant behavior of Enron employees is tarring a whole swath of the industry, like a hazardous waste site that has not been fully remediated.

Perhaps there are traders out there today gloating in similar fashion over the high prices of gasoline and crude oil, but most of the people I dealt with during my time in that part of the business were ethical and honorable, and the few that weren't suffered for their poor reputations. Things may have changed, but I don't think they've changed that much.

By the way, the blog (or rather the blogger) will be on vacation for the next week. In the interim, I will be providing a selection of writings from the last five months. (The hundredth posting in this blog went up yesterday.)

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