Cigars Ease the Tension for the Big Dogs on Chicago's Futures Exchanges
From the Print Edition:
Pierce Brosnan, Nov/Dec 97
(continued from page 1)
The manager of Jack Schwartz is Billy O'Hara. For 17 years, O'Hara, now 41, traded on the Chicago Board of Options Exchange. He left about two years ago and began working at the cigar store, a move that allowed him to stay close to his friends.
"I tripped over the trading business when I was 20 years old and was involved with it for about 19 years working for a brokerage house and trading for myself and learning the business," O'Hara says as he explains why he got out. "It's riskier today than it's ever been. If I'm 28 years old and I lose all my money, it's not gonna change my life at all. You know, I'm still eating pizza five nights a week. I don't have kids at 28! At 40 years old I have responsibilities and just don't want to take that risk anymore of waking up one day being a couple of hundred thousand dollars poorer [when you haven't taken] what you think is a lot of risk. And it happens," insists O'Hara, whose biggest loss was $80,000. "I saw people who lost all their money when they were 50 years old." O'Hara, who has three young children, adds, "You know, to just have a kid in college, I don't know if I could say to him, 'You have to come home. I just don't have the money to do it anymore.'"
On a day like that Wednesday in February, the traders appreciate the way they're treated. One walks by the store, looks in and shakes his head. He doesn't want to talk about it. On bad days, traders might get a Coke or a new cigar on the house.
"When it's a bad day, our job is to feel it and know we can't cross that line that you normally can cross with a person," O'Hara says. "We would never make fun of the day they had. We want them to come in the back room and we've had people come in here that just need to sit. 'Come on back here and we'll close the door.' We had a guy in here who worked across the street for 45 years as a member and he came back here and broke down. And the phones are ringing and he's crying and we're crying for him. You should have seen the place. It was like an encounter session. What's important now is this guy, because he's a friend of ours. Just got to the time where he decided he's had enough. He couldn't make it home so he came here."
Don't misunderstand, O'Hara says, things are not always so sad.
"What we like to provide is a friendship and a haven for people to come in and celebrate with us," O'Hara says. "I would say we sell more cigars for celebrating than we do on a bad day. [The traders] will just keep on walking on a bad day. They're down, they're sulking, and we understand that and we still say 'Hi' to them when they go by, but we won't make fun of them."
In his short career, Tom Baldwin has not given many people much cause to make fun of him. He has turned the profits from the pit into something of a conglomerate, even though he became a trader to avoid corporate life. In 1989, the Baldwin Development Co., along with ING Bank of the Netherlands and Chevron Oil Co., bought the historic Rookery building, built in 1888, on LaSalle Street, and renovated it. Baldwin Asset Management Co. manages the Rookery and other properties. MC Baldwin Financial operates managed futures funds. Baldwin has his own jet, which he uses mainly to get to and from his country house on Michigan's Upper Peninsula. He spent 70 days there last year.
The 50-room house, along with 19 other buildings, oversees 3.5 miles of lakefront along the shores of Lake Superior on 5,000 acres of wildlife sanctuary. The whole complex is a national landmark. Oh yeah, the house is made out of logs and has a price tag of $12 million. The first owner of the house was a successful American who came up with such quaint notions as branch banking and who helped create a little enterprise called General Motors. Buying the house led to Baldwin being the "other" bidder for the JFK humidor in last year's Jacqueline Kennedy Onassis auction at Sotheby's.
"The house was built in 1919 by a guy named Lewis Kauffman. I have his humidor from that era, so I really like humidors and I really was a fan of John F. Kennedy," says Baldwin, who bid in the auction from Chicago with the express intent of buying the humidor, a gift from comedian Milton Berle for JFK's inauguration. "So I kind of went with [the attitude] 'I didn't care what it cost.' I kinda, sort of thought it would cost about $150,000 because I'd heard Milton Berle was going to pay up to a hundred. So I thought, 'Well, screw him. If he thinks he's gonna buy it for a hundred, he's gonna have to pay a whole lot higher than that,'" Baldwin says with a laugh. He only told Joe Howe that he was going to bid six figures for the JFK humidor. Neither Howe nor Baldwin thought anyone else would bid that high. Of course, Marvin Shanken, the publisher of Cigar Aficionado, bid higher, and higher, and higher. Baldwin shakes his head. "And, you know, $510,000 is where I dropped out. So I was disappointed."
Howe calculates he could have saved one of the two final bidders a significant amount of money. "I'm pretty sure I'm the only one who knew that Tom was going to bid for the humidor," Howe says while tasting five different cigars downstairs at Chicago's Havana Café Cubano. "If I had known that Marvin was going to go that high, I would have put together a conference call with Tom to work out a compromise and maybe they would have given me a commission."
You must be logged in to post a comment.