They were stepping out of a frenzied blur: The flash of hand signals, the brightly colored coats, the sweat and sore feet and hoarse voices of the young (almost exclusively male) traders who are smashed together, all day long, on the steps of the ruthless pits.
Here, on the floor of the Chicago Mercantile Exchange, Chicago is still the city of the big shoulders, the city that works, still my kind of town; here, where billions of dollars change hands in incomprehensible fashion in the Swiss franc pits, the live cattle pits, the Eurodollar option pits, Chicago still does what it has always done best, which is to provide a forum for capitalism at its most elemental.
And yet just minutes removed from that organized melee, just after gathering their breath from shouting their last orders of the day, 55 of the Merc's best traders and brokers were brought to a sudden stop on Monday, forced to step across the street and into another world, where quiet contemplation would replace raw economics.
The traders, still wearing their trading badges and vests, had come to the Chicago-Kent College of Law across Wacker Drive from the Mercantile Exchange in downtown Chicago for the first of the Merc's new ethics courses, now mandatory for all 2,500 of its members.
In the wake of last year's explosive commodities fraud scandal on Chicago's trading floors, the Merc's leadership had decided that a professionally developed seminar in ethics would at least help make traders more aware of the fact that, down in the pits, morals do apply.
"The whole course is designed to get them to reflect on what their behavior (as traders) says about them as people, and what their behavior says about their trading system," observed Donna Sockell, a business ethics specialist at Columbia University's School of Business, who developed the program for the Merc. "We're not really teaching ethics. We're trying to get them to pause and reflect, to get away from the hustle of the pits and step back and think about what their choices say about them."
Still, James Oliff, chairman of the Merc's ethics committee, stressed that the program is, in a sense, just preaching to the converted. The dozens of traders who were indicted or convicted in the federal inquiry have been suspended from the Merc and thus have not been invited.
"We're approaching this as if our members are good, hard working professionals, who are here to take some professional training," Oliff insisted. "If we just encourage them to think about what their actions mean, then we've accomplished our job."
Skeptics noted, however, that the course also performs another task for the Merc, by providing good public relations just one week before the first criminal trials are scheduled to begin in the widespread commodities fraud case.
Some even say the new ethics program is symbolic of how much more aggressive the Merc has been--compared to the more traditional Chicago Board of Trade--on the public relations front since last year's scandal. The Board of Trade, Chicago's largest and oldest commodities exchange, is still studying whether to require its current members to attend an ethics program, although new members are exposed to ethics discussions during their orientation, a spokesman said.
"The Merc has been more aggressive at public relations," observed Steven Senderwotz, a former assistant U.S. Attorney who prosecuted criminal cases in the commodities fraud area and who now defends traders in criminal cases. "The Merc is trying to do things in-house, to try to convince regulators that additional regulation is not necessary."
Still, the two-hour course did seem to make some impression; traders emerging from the classroom on the third floor of the law school came away impressed. "It was a good course, it was a good idea," said one trader who refused to give his name.
"I was thrilled with their participation," gushed Richard Kling, the law professor who conducted the first session Monday. "I went in expecting anger and hostility from them, for having been forced to come here. There was some of that initially; they are angry that the alleged misconduct of a few has tarnished an entire industry. But eventually they became very involved in the discussion. At the end, some of them said thanks, you've opened my eyes."
Although the session was closed to the press, Kling said the discussion focused largely on "gray areas," forcing the traders to think about hypothetical situations on the floor of the exchange in which the behavior described was not necessarily illegal, but still unethical.
"For instance, we talked about what they would do if a customer said, 'I don't care what you do in the pits, as long as you make money (for the customer),' " said Kling.
"And," Kling added happily, "they all said they would be willing to say no to a customer."