Jan. 3rd, 2008

peterbirks: (Default)
There's a guy who follows all the golf tournaments. When he's not working as a spot trade in crude oil, he's out there, at nearly every green. You may not know his face, but you will have heard him, because, the second a putter hits a ball (or, in some extreme cases, a seven-iron) you hear the shout "GET IN THE HOLE!!!!"

Leaving aside how laughable this is, you have to ask what the psychological driving factor is here. The "shouter" knows that the ball won't be influenced by this. So, what's going on in his head?

Presumably it's one of two things. One is that the shouter wants to be a "participant" rather than an observer. Unfortunately, being shit at golf, he has no chance of playing in these tournaments. But he can pay to get in and shout. So he does. The second is that the shouter wants to share in the "success" of the golfer. Although he knows, and the golfer knows, that the shout has no influence, we are looking at a temporal confusion of cause and effect. "The man hit the ball. I shouted 'get in the hole'. The ball went in the hole. I rest my case".

How do I know that this guy works in the crude oil spot-trading business?

Because yesterday that self-same man bought 1,000 barrels of crude (the minimum trade size) at $100 a barrel, when the prevailing price was $99.53. He did so that he could frame the confirmatory print of the order, showing that he was the first person to trade oil at $100 a barrel. Hell, why didn't he buy at $1,000 a barrel? That would have been spectacular.

The guy sold those barrels a little while later at the prevailing price, costing himself about £400, I guess. What's the driving force here? It's certainly something way outside the world of supposedly rational spot-trading.

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