Hussein Statue's Fall Slows Markets as Traders Stop to Cheer
Bloomberg Terminal | 4/9/03 | David Wilson
New York, April 9 (Bloomberg) -- The toppling of Saddam Hussein's statue in a Baghdad square brought trading in the world's most active
futures contract to a standstill.
``The crowd went crazy,'' said John Brady, a Eurodollar- futures broker working for Man Financial Inc. at the Chicago Mercantile Exchange.
``We all clapped, and there were some `Yahoos!' that went up in the air.''
Trading in the futures, a gauge of expectations about three- month lending rates, stopped for about 30 seconds when the 20-foot bronze
monument came down, Brady said. He added that he couldn't recall a similar halt for a news event in his eight years at the exchange.
Similar scenes took place at other U.S. exchanges and in trading rooms as the statue fell, symbolizing the collapse of Hussein's regime as
allied forces seized control of the Iraqi capital, at 10:49 a.m. New York time.
The reaction in countries such as France, which had opposed the war, was more subdued. ``We didn't stop working,'' said Eric Hassid, a
trader at International Capital Bourse SA, a Paris-based brokerage.
Traders at the New York Stock Exchange cheered and whistled as they watched on television screens. Between 10:40 a.m. and 10:45 a.m.,
just 13.5 million shares changed hands -- 34 percent less than in the same period a week earlier.
Phones Didn't Ring
``There was a hushed silence around each TV,'' said Kenny Polcari of Polcari & Weicker, a broker on the Big Board floor.
``Standing in the crowd watching that statue fall felt like it did watching the Berlin Wall come down,'' he said, harkening back to the 1989
destruction of the barrier between East and West Germany.
At the Chicago Board of Trade, the Mercantile Exchange's biggest U.S. rival, there were cheers as the American flag was hoisted over the
world's largest trading floor. Trading paused there, too, when the statue fell.
``We were all glued to the TV, and not one phone rang during that time,'' said Michael Rose, director of trading for Angus Jackson Inc., a Fort
Lauderdale, Florida-based firm that buys and sells commodity futures. ``Goosebumps, that's how we were feeling.''
Rose and his team of traders had watched the dismantling of the statue since he arrived at work at 5 a.m. New York time.
For some traders, the monument's collapse was more than a milestone in the war in Iraq. It was also the moment when they knew whether
they had won or lost on a wager.
`Took the Under'
``We were on the phone with brokers making bets,'' said Jeff Swensen, a trader at John Hancock Advisors, which manages about $29 billion
in Boston. The ``over/under,'' or the time by which the statue was supposed to fall, was noon Boston time, he said. ``We took the under.''
Gib Clark, head bond trader at Zions First National Bank Capital Markets in Jersey City, New Jersey, said he and three colleagues had $5
riding on whether the single rope draped around the statue would be enough to do the job. One trader wagered the rope would break; Clark
was on the side betting it would hold.
Then ``the Americans came and put the crane up,'' Clark said. ``It became a push because it didn't get resolved by the rope,'' he said, using a
bettors' term meaning that the bets were canceled.
The toppling of the statue signaled that another bet, on Hussein's ouster, may pay off. There is a 96 percent chance that his reign will end this
month based on trading in futures at Dublin-based TradeSports Exchange Ltd.
The Hussein futures fluctuate in value from zero to $10. April contracts rose to $9.60 at 4:30 p.m. in London, from $8.80 yesterday and as low
as $4.10 two weeks ago, according to prices on the TradeSports Web site.
Contracts settle on the last day of April, May, June and July and pay the entire $10 if Hussein ``is not internationally recognized'' as the leader
of Iraq ``if for any reason or under any circumstance'' under TradeSports' rules.
`Difficult to Concentrate'
In the U.K., part of the U.S.-led coalition in Iraq, the statue's fall followed another market-moving event: the annual presentation of the
government's proposed budget to Parliament. Chancellor of the Exchequer Gordon Brown predicted the biggest deficit since the Labour
government was elected six years ago.
``Traders found it difficult to concentrate on the budget because many split-screen (television) feeds had pictures from Baghdad,'' said
Andrew Milligan, head of strategy at Standard Life Investments in Edinburgh, which manages 75 billion pounds ($117 billion).
Even in Germany, which joined with Russia as well as France in opposing the war in Iraq, some people said they were happy to see the
monument topple.
``We were all watching TV and cheering,'' said Holger Schmidt, a broker at DZ Bank AG in Frankfurt. ``We were a bit disappointed that
Saddam Hussein's statue didn't come down all at once.''
On the other hand, French traders such as International Capital's Hassid said their day was business as usual -- no shouting, no cheering, no
halt to work.
2003-04-09 15:36 (New York)
--David Wilson in the New York newsroom
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