Are traders amoral gamblers or cerebral speculators?

9 February 2009

1 minute read

Are traders amoral gamblers or cerebral speculators?

If there's a French trader in your vicinity, he or she is probably looking a little down in la bouche.

In a TV appearance last week, President Sarkozy accused equated traders at French banks with speculators and players of the lottery.

It prompted one self-proclaimedly "not that rich" trader to write to Le Monde pointing out that most traders come from top schools, and are honest, hard working high performers.

Trading, she said, is [our translation] -

A technical, complex and stressful career, from which the advantages for the markets, the economy and the banks have for a long time been superior to the risks...

So...do you agree that traders are highly intelligent individuals, unfairly maligned? Or do they all deserve $50k bonuses and a sinecure in a government run bank for remainder of their working lives? Please share your thoughts below.

AUTHOReFinancialCareers UK

Insider Comment

ge
geto
14 May 2009
Most of the traders within the global banks paticularly traders of derivatives and CDS are all dodgy traders. Investment banks obviously tolerate teher dodgy tradings to make profit. But this is what you call glamorised corruption in the banking sector. Most of the time thier front office traders are in conivance with thier operation to conceal fraudulenta dn risk trades. Like Societe Generale not just its desk in Europe but across its world front office desk. Australia included. This has been happening in the past 3 years. The operation head in its Australian branch, business analyst, portfolio managers, etc....are all inconivance.
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Ma
Marc
3 May 2009
its very difficult to distinguish between speculation and investment like it is to distinguish hedging from speculation (and the market conditions can transform a hedging position into a speculative one)
the real resposnibles for the current crisis are cleraly western politicians and acolytes who were in place before 2008, like George Busch/Greenspan, Nicolas Sarkozy, Gordon Brown and others
thos guys should resign when still in place and fast !
One person i appreciate is the Luxemburg premier Jean-Claude Juncker because he does not hesitate to tell part the truth about the US and the corrupt french governement
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Fo
Fooler of Randomness
10 February 2009
Why did M. Sarkozy or Gordon Idiot Brown not mention anything in the years pre-2009 about bonuses? Surely they are not bowing to public opinion? Charlatans, the lot of them. And the public in general. Everybody is. Except us lovers of the multi-sigma event.
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Sh
Shody
10 February 2009
It reminds me of the "goof old" time of nazi persecution on the jews; scapegoats, scapegoats ...
Every serious student of economy knows that the more speculators, the less volatile the stock market - you just need an OBJECTIVE analysis of volatility to prove it. They provide liquidity, which benefits to "real" operators like hedgers.
But this is too much to grab for most people and populists like Sarkzoey (and others). This is a time where intelligent arguments are worthless, and are replaced by emotions and witch hunting.
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Si
Simon
10 February 2009
If one takes a look at the very motive and the end product of speculation, one would quickly realize it is no different from that of gambling. The act of speculation is socially unproductive and hence incapable of creating genuine wealth. I think it is important to distinguish between trading and speculation. Trading for hedging purposes is an effective financial instrument for reducing risk and insider trading effectively reveal the value of the superior information involved albeit illegal yet well concealed in most advanced economies.
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