THE JOBBING SYSTEM ON THE LONDON STOCK EXCHANGE: AN ORAL HISTORY

Interview No. 41: Brian Carpenter

Interviewer: Bernard Attard

Home: 17 October 1990

Tape 1, side 1

BA: Could you first tell me, Mr Carpenter, where and when you were born?

BC: I was born in Sutton, Surrey, in 1926, July 29th.

BA: What were the names of your parents?

BC: Edward Dudley Carpenter and [Clare] Catherine Carpenter.

BA: What was your father's occupation? 

BC: He was an import/export merchant in the City.  He traded round the world in a company called E. Whiteaway & Co., which were taken over soon after he died.

BA: And do you know what your grandparents' occupations were?

BC: Well, my father's father died a long time ago; I think he [ie. my father] was about 16, so I never met him. And my mother's father was Indian Army, basically I think.  I don't really know an awful lot about it.

BA: Did you have any brothers or sisters?

BC: I had a twin brother.

BA: And what did he follow as a career?

BC: He was a leaf tobacco buyer; he ended up with Gallahers.

BA: Where did your parents send you to school?

BC: Epsom College.

BA: And did you have any ambitions for yourself when you were at school?

BC: Well, Epsom College was a local school to us where we lived and it basically produced an awful lot of doctors. It was very well endowed.  And the idea was that one would look at a medical career.  But we went there in 1939 just as the War broke out and in 1943 both Keith, my brother, and I volunteered through a thing called 'Y Entry' - entry into the Navy - and volunteered for flying training.  Therefore, in 1944 when we were 18, we joined the Navy and had a nearly three-year gap.  I came out in January 1947.

BA: What did you do when you were demobilised?

BC: Well, my brother and I were both supposed to go into the tobacco trade.  He was out east in a cruiser and wasn't going to get back for six months.  Now my father had traded in Africa quite a lot and had a big connection in the Belgian Congo and said it would be a very good idea, since I couldn't start without my brother, if I learned French.  So I was posted to Brussels, which was quite an interesting period of my life.  I was in lodging there with two old ladies who couldn't speak English so my French came on quite well.  And when I came back and Keith came home in July of '47, we decided that it wasn't a very sensible thing to have twin brothers in the same firm.  He was quite keen on it and I didn't care very much what I did, and so he went into tobacco and he spent his life in the tobacco trade on the leaf side.  I then was told to get a job and I remembered that before the War I had a cousin who came to stay with us for about a weekend and eventually stayed four months because he couldn't get a job.  He ended by going to Unilever and getting a management traineeship and did very well.  So I pushed off to Unilever House and said, 'Give me a job', and they did, and they put me on the groundnut scheme which was managed by United Africa Company.  That was not my scene at all - I don't think it was anybody's scene actually because the thing collapsed with an enormous deficit.  After that I'd been messing about with motor bikes and motor cars and I said to my father, 'This is what I'm interested in and I want to do.'  He wasn't very keen, but very generously he said that if I'm going into that I ought to get a degree as a handle to my name.  And he, I think, gave me £5 a week. I was buying and selling cars from home and generally earning a bit of money and eventually came out with a motor engineering degree.  I then worked as a fitter in a garage for about six months to get some good training; it was with a Rolls Bentley garage and it was jolly good training.  Then I got a job as an assistant to a man who had had an unfortunate experience in the garage trade and was building up another garage in Richmond.  I was his number two.  Basically the thing was on the ground and we built it up and I spent four years there, I think.  By which time I was pushing 30; I was beginning to realise that my father was right that you shouldn't mix your hobby with your business.  I'd got one or two connections in the City. I had a cousin as a broker and one or two other people, and used to meet them fairly regularly and I had this idea that if I went into the jobbing side, which attracted me ... I didn't know anything about it but it attracted me because it was a trading situation.  I then got an introduction through this cousin to the senior partner of a small jobbing firm, and my cousin's senior partner was his godfather so you have a slight situation that you don't have these days very often.  And I joined.  That was in 1957.  The name of the company was C. Douglas Clark.  The two Clark brothers were the first and second partners and they'd inherited it from their father.  I worked there and - when would it be? - about 1961 I got a partnership, my membership.  And we traded on.   I think we were under 30 in all.  We were 7 partners and a staff.  In 1966 there was a bad recession and we couldn't make any money.  We were too small.  You had the Wedd Durlacher set-up driving its way through the market.  We could compete I think as individuals but we couldn't compete in money terms.  So in September 1966 John Clark, the senior partner, on a beautiful September day, walked us round the Stock Exchange, which incidently was in half then because they were rebuilding and we were moving from one half to another half, and we individually were asked 'Do we go on or do we pack up?'  And we basically all of us, with one exception, said, 'Pack up.'  That was at midday.  At three o'clock in the afternoon I went up to Wedd Durlacher's trading room with John Clark, with the books, and he and I shut the whole firm down, to say 'I've got so many of this and I'm short - buy this, buy that.'  

BA: So did Wedd close all your positions?

BC: We closed our position.  More or less all of them.  There were one or two oddities which they didn't.  And we put a press statement out.  Nobody knew about this.  Because if somebody had learned this it would have rocked the market because we were quite a well-known firm, and I think a well respected firm.  And we put this notice out when it was all complete, about 6 o'clock.  The next morning I went down with another partner and we just wrote on the board - we'd rubbed it clean - 'We have ceased trading'. There were startled looks and that was that.  We'd agreed, in fact, as a partnership, that if we couldn't merge with somebody with the whole partnership going we'd pack it up; i.e. we weren't going to leave any stray dogs around. And we couldn't do that for one or two reasons, and so we were out of a job.  The first thing we did then was to try and place all the staff, which eventually we did, and [then] punted around and looked for a job.  It took me about two months.  I joined a firm I had traded against - I was basically a food jobber then - called James Case, and obviously I knew them and they took me on.  James Case at that moment were halfbook with Akroyd & Smithers, with the supposition that Akroyd would absorb them.  Akroyd were trying to do what Durlacher did in expanding the whole system of their jobbing activities.  I went there then at the end of '66 - October '66, I think it was, yes - and worked on the food book.  About 1970 I had a call from my senior partner...

BA: What was his name?

BC: Hugh Merriman.

BA: So by this stage the merger with Akroyd had been completed?

BC: The Akroyd/Case had, yes.  And we had a little chat and he said, 'Well, I think I'd like to offer you a partnership.'  And I was the last partner in Akroyd, I mean literal partner, and it only lasted a few weeks.  But it was an incredibly generous offer and obviously they liked what they saw, I suppose.  Then as a partnership it was folded up a few weeks later and became a private limited company, and eventually, as you know, went public.

BA: Why had he asked you to become a partner at that late stage?  Was it to be able to participate fully in the benefits of flotation?

BC: Yes, to offer me a bit of the action in capitalisation.  That was a really generous thing to do because obviously, with hindsight now, it was a very successful operation and everybody benefited considerably in the financial field as it were.

BA: Let's go back a bit and review some of things that you've said.  How would you describe C.D. Clark when you joined them - were they one of the important jobbing firms on the Exchange?

BC: Yes, they were well recognised as a traditional small jobbing company; they'd got a history of 70 or 80 years behind them.  The problem basically was, which actually I didn't realise when I joined them but I would still have joined them anyway, was that they had obviously limited capital and they obviously had, therefore, a limited number of markets they could operate in because it wasn't viable to expand.

BA: Which markets were they jobbing in?

BC: They were jobbing in basically food, rubber, industrial markets and a fixed interest book.  And in about 1960 there was a firm who stood opposite us called Robert Moy who were basically just jobbers in rubber shares - the Plantation shares - and old Bob Moy died and his son, Geoffrey, was there and we bid for them and negotiated with them and they came and joined us, and Geoffrey became a partner of C.D. Clark.

BA: What sort of offices were the firm occupying when you first arrived?

BC: Oh, we were off Old Broad Street with the old lift you pulled up, on the rope and they were very antiquated.  We had, I think, only two rooms: we had a room where the staff worked and at the far end there was a room for the partners and that was it.  

BA: What did the back office staff amount to?

BC: Oh, I should think 12.  There was a manager and the rest of them were clerks.

BA: What were the first jobs they had you doing?

BC: Well, they were teaching me the settlement.  I was going through the routine of what happens when you buy a share or sell a share and what happens afterwards so that you can either receive or take money.  So you were learning settlement, basically, which is a very fundamental thing obviously.

BA: How efficient was the firm in settlement?  I've been told that some firms found it very difficult balancing books.

BC: I think it was pretty efficient.  When we packed up there were absolutely no problems which points to the fact that they were very efficient really.  The manager was good, very good. 

BA: And how would you describe the partners at the time?

BC: A mixed bunch.  John Clark is an incredibly nice man and probably shouldn't have been a jobber.  His interests were very broad.  He was more of an intellectual man than a business man it's reasonable to say.  His brother Alan Clark had had a very unfortunate history in that he was in the Guards Regiment in the War and was pushed into the landing at Salermo and they had a hell of a battle there. Then they were given leave and he went to Rome, and the next thing he knew he woke up in a hospital I think in Liverpool it was.  He'd got Polio.  That would be '44 I think, and he eventually came into the firm in about '48.  He could hardly move and he was always on calipers and sticks and things and you had to help him round the place; a very irascible man, very, very difficult bloke;  generous but he didn't suffer fools gladly and he didn't suffer quite a lot of other people gladly either.  Then there was a fellow called Harold Ellis who was the brother of the Ellis who wrote the financial columns for the Daily Express at the time.  There was Beasley, Jim Beasley, who was a bit of a joke really and had medical problems and died quite young - about 55 I think he was.  He suddenly flaked out.  Sir Charles Frederick who was Alan Clark's major in the Guards and came in on the old boy network as it were, who again should not have been a jobber, he wasn't made for it; actually he turned round and went broking and was I think reasonably successful and I think he became Chairman of part of the Provincial Stock Exchange circuit. Me, and Geoffrey Moy who came in from the other firm.

BA: About how old were the Clark brothers?

BC: I'm just trying to work out.  John would have been mid-forties I should think.  Alan would have been mid- thirties.  Ellis would have been a bit older.  Oh, I've forgotten one partner: 'Tubby' Walker, Victor Walker, known as 'Tubby' Walker, who went on and on and on.  He had a son in the Stock Exchange.  He was, I should think, about the same age as John Clark, something like that.

BA: Did the firm ever have any contacts with the companies in whose stocks they traded?

BC: Very little; very, very little.  I don't think many people had, especially in the smaller ones.  I suppose the bigger ones, the big one that was forming - obviously chased into the structure of the directors of the big firms they traded in.  

BA: And that wasn't the case with C.D. Clark?

BC: I'm pretty sure it wasn't because there wasn't any need.  You weren't trying to run a position because you hadn't got the money to run the position, so you were trading it.  And the thing to do, if you've got a penny ha'penny or threepence profit you took it and started again, and that was really the basics. So you shouldn't have lost a lot of money.  There was obviously a continual battle by the senior partner to try and contain the people who were trading because they said, 'It's my book, I'm getting on with it.'  And then he said, 'No, you're in a partnership, you've got to toe the line.'  

BA: How did your training progress with the firm?  You said that your first jobs were in the settlement or moving around different parts of the back office.

BC: Yes, when the manager thought you had got hold of it, you then got a blue button and went down as a blue button on the floor of the House.

BA: Do you have any early memories of getting your blue button; were you nervous about going down to the floor of the House?

BC: I wasn't nervous, I don't think, but it was a shock.  One had had War experience.  One or two things had happened which shook one up a bit; so it wasn't a total shock but it was a shock.  And there was an awful lot of people and an awful lot of noise.  I found it very difficult to hear initially, and gradually you got used to it.

BA: Do you have any early memories of difficulties associated with not being able to hear?  One person described to me of not being able to hear the waiter calling out the firm's name.

BC: We were stationary obviously, as jobbers standing on our pitch, so they didn't often call us.  But Alan Clark used to say, 'Buy so and so, errk'.  You then had to say, 'I'm sorry I didn't catch that.'  Then there was a row, 'Why not?' Yes, a fairly jumpy bunch they were, generally.  There was a lot of aggression.  There had to be, otherwise you wouldn't be doing your job.  

BA: So what else were you doing as a blue button?  You were booking bargains...

BC: Booking bargains.  You were running messages.  Nobody wore badges in those days so if nobody knew who the bloke was they were talking to they used to say, 'Follow that bloke.'  And you weren't allowed to ask the bloke 'Which firm are you with, please Sir?' You had to ask somebody, 'Who the hell's that?'  You ran messages and you were  general factotum; if anybody wanted a bar of chocolate or something off you went and got it, and generally a dog's body.

BA: Did you find you were a relatively senior blue button?

BC: In age?

BA: Older, yes, than a lot of your peers.

BC: Yes, I was.

BA: How did you find that?

BC: It didn't worry me one little bit actually because all I wanted to do was to get on.  Yes, I can see one could have been a bit put off by me at say 31 or 32 being told by a 24 year old who was trading to get on with it.  But it didn't really affect me.  They were, in the main, a very nice bunch of people, you see.

BA: How did you feel about your decision to go into the Stock Exchange after having pursued quite a varied career before that?

BC: Well I thought it was perhaps not logical, but it was a move that I really felt would make me money, which was really what I was after.  And in fact it lost me money, because when we packed up I'd borrowed some money to go into the partnership and it went; therefore I came out of the partnership owing money - which wasn't very easy.  In fact it was very difficult for a bit.

BA: This was before joining James Case?

BC: Yes, as I was joining James Case.  They were generous in that they took some of the loan money off my back as it were, and I paid them back rather than pay people outside the company.

BA: Did you have to wait long before you were authorised?

BC: Two years, probably. I think it was two years - wasn't much more if it was.  And one worked then with a senior person; mind you, you were holding the book obviously when he wasn't there; you were supposed to know all about it.

BA: And which book were you working on, was it the food book?

BC: Food book at first, yes.  I had a short spell trying to run a rubber book when Geoffrey went on holiday, but not knowing anything about it he came back and he blanched, rolled his sleeves up and got down to putting it right.  

BA: Was there a big difference between jobbing rubber stocks and food shares?

BC: Oh, yes, you had to know every thing you see: you had to know the background of the stock, did they make sisal, who was integrated with who; there was a percentage of this that and the other.  It was terribly complex, actually.  And people who really got to grips with it made a tremendous amount of money.  You could buy stocks - you see they were all run down from the War and there were penny stocks around the place which turned out to be an absolute bonanza.  If you bought hundreds of thousands at a penny the multiplication for that growth rate was colossal if you bought the right one.  

BA: What were the characteristics of jobbing food shares?  Were they completely different?  

BC: Oh, yes.

BA: Did you need to know the background of the companies?

BC: You needed to know something about it.  I always had a theory that you could know too much in those days.  You'd got to have a market sense.  It's no good saying, 'Rank Hovis are going up' if the rest of the market is going down; you're categorically saying, 'They're going up', and in fact they would be going down because the market was taking them down.

BA: Is that what you mean by market sense?

BC: Yes, you've got to smell it, sense it, feel it.  

BA: Where does one acquire that?

BC: By being there, really.  You've got to have this trading feeling in you.  If you've got it in you, you can develop it; if you haven't got it in you, nobody can put it in you.  

BA: Would you say anyone influenced you in particular in learning your jobbing skills?

BC: Yes, one of the clerks there, not Clark people, Keith Knowles, who was brilliant.  He was self-made, came in at 15 sort of business and he was absolutely brilliant, I thought.  And an interesting thing about him, he inspired me actually.  When we packed up he moved over to a discount house and they're a very different scene as you know, and Keith was there pushing a pen. He wasn't doing any trading and the partners there, most of them elected without knowing each other's activities to go on holiday all together.  So they said, 'Who's done any trading?'  And old Knowles put his hand up and said, 'I have.' They said, 'Well, there's the books, get on with it.'  They were away for about four weeks.  He'd obviously been watching traded gilts - which again is a very, very different thing - and getting the feel of it, and he made more money in that month than they'd made in a year, so I'm told.  Then he was pushed up the ladder like mad and he stayed there all his life.  He unfortunately died young, he'd had a heart attack, mid fifties.

BA: What were his qualities?

BC: He'd got sharpness and good sense of humour, totally honest, and a very nice man.  From a chap who'd started at 15 he had a memorial service at the big church by the discount house, and not many people get that, and everybody was there, everybody - Peppiatt was there - I was there, everybody was there.

BA: How did you find your early experiences as an authorised dealer? Did you find it difficult? 

BC: Yes.

BA: Can you elaborate a little bit?

BC: Well, difficult in that it takes a certain amount of time to sense what is going on and why you're doing this that and the other.  And quite often if you're busy there's not enough time to enquire why everybody did this that or the other; and too, you didn't get a very good answer occasionally if you did enquire, I mean people were fairly short and sharp.  

BA: Did you have any early successes or early disasters; were there particular dealers, broker dealers, who you found difficult to come to grips with?  

BC: Yes, there was one chap who should be nameless.  Tesco was one of the things we dealt in and Tesco was a stock that was being manipulated really by the outside Tesco people.  I think, from memory, what used to happen, Tesco had about 5 brokers and they used to say, 'Right count down 5, 4, 3, 2, 1, go in and buy them.  Buy as many as you can.'  And so the price was forced up and up and up.  In my innocence, when I first started, this fellow came up to me and said, 'What are Tesco?'  and I don't know what they were - penny ha'penny threepence shall we say - and he said, 'What's the market?'  and I said, '25,000.'  'Buy 25, do you want to do any more?'  'Well,' I said, 'are you a virgin?'  He said, 'Oh, yes.'  I said, 'Well, I'll sell you 50 then.'  And of course I'd got a seller, and off I went to the seller who had dealt 5 minutes beforehand.  So I called this bloke back and I said, 'You weren't a virgin.'  And he said, 'How do you know?'  I said, 'Well I know.' I said, 'I'm not going to say what I'm going to say to you in the House.  Step out of that door' and he did and I let fly.  I said, 'Don't come to me again, ever, ever, ever.'  I said, 'There'll be a time when you won't be able to do any of your business because I won't deal with you. I'll be the only one who can do it', which came true, actually, about two years later.  

BA: Just for the benefit of the tape, can you explain what you mean by virgin in that context?

BC: Virgin means that you haven't been to any other jobber, that you haven't been opened by a jobber; that means that they have read what you want to do and haven't done it because they're immediately going to change their price, ie. it is just between the broker and the one jobber.

Tape 1, side 2

BA: Did a lot of that price manipulation go on in stocks? 

BC: Yes, it certainly did, I think.

BA: Was that a constant feature of the Stock Exchange, I mean did it continue right through your jobbing career?

BC: No, the rules were tightened up as one went through, and now it's incredibly tight, isn't it.  But I think in the late fifties, when I started, and the early sixties it was pretty lax, so you could manipulate a price, if you wanted to.  You had to have a certain amount of guts to do it but normally I suppose if you were going to do it you knew the score, you knew what was going to happen.  I should think very few of the manipulators went wrong. It's not only manipulation.  If you buy a great lump of shares at a discount price, for instance, you can parcel them out to your friends, who'd make a profit and therefore you'd get more back, tit for tat.  

BA: Was there a lot of what we'd now call insider information flowing around?

BC: I don't think there was an awful lot then, no.  There's obviously always been and always will be a certain amount.  You can't deter certain people, but I don't think there's a tremendous amount.  There was obviously later on.  I think there was a terrific amount of insider stuff going on and manipulation.  

BA: Were people trading on personal account.  Was this, again, fairly lax?  

BC: Well if you could make a thousand penny ha'pennies, which was £12 10s, £12 10s in those days was worth having, it really was.  And if you could get 1,000 threepences and get £25 it was even better.  

BA: Was it something a jobber could do just as easily as a broker?

BC: Yes.  The written or unwritten law, I don't know which, was that you didn't trade on your own book; and this is obviously how ... certain people did and got caught out on it and [were] finished, that's it.  Every company's had this problem of people trading.  We had a bloke once who suddenly bought a house and a Lotus and we thought, 'How the hell's he doing that?'  And it was obvious where it was coming from.

BA: How would you actually do it, trading off your own book?

BC: It's easy.  You think something's going up, so you leave a space.  So supposing you think something is going up, and you've bought some stock, you leave a space and then you go on trading and you've got that space against the stock that you've just bought: supposing you buy 10,000 shares at £1, you leave that and then you probably try and force the price up and eventually they get to a £1 and a shilling, 21 bob.  Well then you book the bargain at a £1 and £1 and a penny ha'penny, so you have then got 10d ha'penny on 10,000 shares which is quite a useful sum of money.  That's the easy way.  But if you do that as a jobber, you have to have collusion with a broker because the broker's got to book the bargain, and if the broker has any sense at all - the people who are running the firm - they will eventually spot that x, the broker's clerk, is always dealing with C.D. Clark and is always making a profit, and it doesn't happen; so 'Have a look at that one' is the answer.  And that is actually how quite a few of the people have been caught out.

BA: So would it be a case of some brokers, or some brokers dealers, becoming very friendly with jobbers' dealers?

BC: Oh, yes you've got to have a close association, obviously, to do that.

BA: Did C.D. Clark have a following of particular brokers?  Did you find you dealt with particular firms?

BC: Yes, but you always have had. There were various people who were very matey with you.  Most people one got on with.  There were people you couldn't stand, hence my fellow with Tesco, but in the main you got on with [them].  But you had literally particular people, so that if, for instance, there was a new issue and you'd got a limited number of shares which you had to parcel out, your buddy got a few of those; whereas the Tesco man wouldn't get a look in, it's human nature isn't it?

BA: Who were your main opposition in jobbing?

BC: Well, Durlacher, Case, I'm just trying to think of all the names now - Shaw & Co., Bisgood, some of them packed up; I can't remember the names, they don't come to mind easily.

BA: Did you find it was a very competitive market?

BC: Yes, it was.  You challenged your opposition.  There was obviously, at times, what we call 'a back', i.e. I'm bidding more than they're offering stock at. Well, they'll come over to me and offer me stock.  

BA: What were your relations like?

BC: Pretty tense.  They got better as the thing evolved and moulded itself into big units, and you had to get on and you had to have confidence in one another; but it was pretty head on stuff.

BA: Do you have any recollections of particular challenging experiences?

BC: Yes, once I went over to a firm much bigger than myself and I saw the dealer on the book who was far more senior than me, and I said, 'I hear we've got a choice price in so and so, do you want to deal?' which is the way to challenge him, 'Do you want to deal?'  He said, 'Yes, tell me what you want to do.'  And I said, 'No, I'm not going to tell you what I want to do until you say you'll deal.'  And he said, 'No'. So I said, 'Well, forget it, I don't want to know, thank you very much.'  So he immediately went to my senior partner and made a complaint about me, who came to me.  I said, 'Do you want to live in this market or don't you want to live in it?  I think I'm absolutely 100 per cent right.'  And eventually this fellow, about two weeks later, came back and said, 'I'm sorry.'  But it was pretty hard stuff.  

BA: How would you find out what prices your opposition were making?

BC: Because a broker would come and say, 'Well, that's choice.'  You'd say, 'Where?' [both laugh]  Or you might see a price change: if I've got them up at £1 and he's got them up at £1 and 5d or 6d or something, there's obviously scope for something somewhere so you go over and have a go.  But if he refuses to deal, he's going to run a market against you, [he's going] to put the screws on.  But you may be playing poker with him and you don't really want to do that; you want to do the other thing.  So he'll then jump into the trap.  

BA: Did you keep an eye on what your opposition were doing while you were jobbing?

BC: Yes, you'd say to the blue button, 'Quick, go and see what so and so are', because you sense something's wrong, you see.

BA: What kind of size were you making?

BC: It varied quite a lot.  But the size of the market then was infintesimal compared with what it is now.  You'd never make a price in a million shares; in Tesco you'd make a price in 25 or 50.

BA: Was there pressure beginning to grow to make prices in larger size?

BC: Yes, all the time.  And of course this is how books got out of hand.  Because in the flair of competition you lost sight of your limits, financial limits, on your particular book.  

BA: Did you find that was problem with your firm?

BC: Yes always.

BA: That people were taking on positions that were too big?

BC: Yes.  Me included, really.  There was one particular bloke who was always ran rough shod over the limitation of finance.

BA: And what would happen then?  Would you find it would be difficult to undo the positions, or you had to finance them?

BC: Well, you would have to finance your book, as a company, you see; but in extreme the order has to come from the top, ie. in our case John Clark, 'Cut that book.  We can't afford to be exposed like that. If something goes wrong it will be catastrophic.'

BA: While you were still with C.D. Clark were there ever situations in which you would be running a joint book to cope with particular situations?

BC: Yes.

BA: How would they work?

BC: Well, you can register them, but a lot of it was done under the counter.

BA: It would be an informal arrangement on the floor of the House?

BC: Informal arrangement which nobody knew about.  There were joint books going on which went on a long time, shall we say, and it was open knowledge that there were joint books.  But you might have a joint book in a particular situation which would last perhaps a week and that would be very hush, hush, because one wouldn't want anybody to know about it.

BA: Were there any particular firms that you tended to do that with? 

BC: Well, yes, you've got to be friendly, obviously.  We had a good relationship with James Case because the Eglingtons who ran it used to fish with the Clarks.  That's the kind of thing that built up.  And a joint book had to be with jobber and jobber.  The broker wasn't in it.

BA: Did you ever think much about capital in those days, in the sense that one of the things that people have said, particularly about the sixties, was that the smaller firms found that they didn't have the capital to run the large books and that was compelling them to merge?

BC: Well, that's exactly what we did; yes, very much so.  And if you're not competitive enough ... The big money earned or lost comes from big positions, and if you haven't got the capital to finance big positions, whether they're bull or bear ...  If you get a bear wrong it's probably more crucial than a bull wrong because the bear seems to go up much faster than the bulls go down; because you have this classic bear squeeze as they call it, still do.

BA: Can you remember any particular episodes?  I believe when capital gains tax was first brought in, jobbers could get it wrong over what they thought investors might do.  

BC: Yes, there was a lot of rigging of market at that time, where you made a price and obviously the broker's client or the broker themselves wanted the price as high as possible because that was the knock off price and it didn't matter if they came back afterwards.  So that if the price was up there and they had bought stock down here, they could run the price up to that and not pay capital gains.  I had a situation in a mail order firm where the bloke kept coming up and saying, 'What are they?'  And we ran the price up - an enormous price rise, about 7 or 8 shillings.  And he came up one day just hours before and said, 'What are so and so?'  And I might have said whatever they were, 'Thirty-five to thirty-six bob' - it was very small market - 'Oh, I want to deal in 10,000.'  I said, 'You can deal in 500'.  He said, 'That's no good to me.'  I said, 'You don't want to deal?'  He said, 'Yes, that's no good to me'.  So I said, 'They're 33 to 4 bob now.'  He said, 'You can't do that.' I said, 'They're 32 to 3 bob now'.  And of course the price came straight back because he'd rigged it all the way up.  He played a reasonable game and said, 'Come on give us a hand'.  One does it.  It's tit for tat.  'You can't do that,' he said.

BA: Now you became a partner with C.D. Clark, in about...?

BC: '61/2.  

BA: How did that come about?

BC: Well, the idea was they wanted to take some younger people in to become partners.  That's one reason why they took over Robert Moy because Geoffrey Moy is about 4 years older than me and we were the sort of younger breed as it were coming along. 

BA: Did they want you to put a lot of capital into the firm?

BC: The basic firm - I can't remember exactly what it's basic capital was, but it was only about 80,000 I think.  And we borrowed money, obviously.  I put in £10,000 which in those days, if you gear that up against inflation etc, etc, I don't know what that's equivalent to but it's a reasonable amount of money, I suppose.  And obviously they expected everybody to be successful in the company which would make money, and you'd plough money back in as you could.  There was a great disparity in relationship between what the senior partner got and what the junior partner got in those days, which was eliminated later on obviously.  

BA: Did you find becoming a partner made a big difference to your position in the firm?

BC: It was too small to make a lot of difference - the firm.

BA: Were you in charge of running your own book by this stage?

BC: Oh, yes; or working with somebody else on a joint basis.

BA: How did you go about running a book?  Did you have a particular approach to jobbing?  Did you like to keep the stock turning over all the time?

BC: I liked to see the thing turning.  Unless I really knew what I was doing, I didn't like to run a really big book because I thought it was crassly stupid.  It goes back to my days at Unilever in this ground nut scheme.  I was sitting there after being there for about two or three weeks and a fellow called Thomas came up and said, 'You look a likely chap, I'm running a book on horses, do you want to join me?' I thought, 'How much are we talking about?' because one hadn't got much money, and he said, 'Oh, very small bets.'  Then some typist came along and wanted a five race accumulator, shilling each way.  We thought, 'Well might as well take her two bob' and it came in.  I can tell you it cost £36, that accumulator, colossal.  And of course £18 each for us was a fortune, three weeks' wages.  So that cured me of that.  That was actually a very cheap lesson because it told me to be a bit steady, don't go for the quick buck, because you can go wrong.

BA: Now at some point, as you mentioned earlier, the firm began to look to the future and see whether it could continue for the future.  Was there any particular time when that began to be apparent?

BC: I should think it was - we packed up in '66 - about '64. We'd have a good three months, and then an average one and then a poor one and we weren't really making any money.

BA: And what was the cause of that?  Was the market against you, did you find you couldn't compete?

BC: I think incompetence to a degree, and not being able to compete with the bigger units that were forming.  

BA: At what level weren't you able to compete?  Was that size?

BC: Size; i.e. financial commitment.  If you can only deal in 10,000 or maybe 25,000, there's people up the road making a price in 100,000 or will make a wide spread in half a million and you can't do it, they're only going along to you in dribs and drabs aren't they?

BA: Were you very conscious of the jobbing firms amalgamating around you, the number of firms contracting?

BC: Oh, yes. They disappeared, all the way round us, that wall we stood on which was, if you look down from the public gallery now, it's the south side of the old Stock Exchange wall, the whole lot went.  They disappeared in five years, I should think, everybody.

BA: Had some of those firms been one-man firms?

BC: No, no.  They weren't big.  They were about our size.  There was Oxley Knox. I can't remember the names of them now.  When I joined, well say in 1960, there were 100 jobbing firms on the floor of the Stock Exchange; one or two one-man bands, as it were; but there were 100 firms there operating.  The one-man band was probably the lucky one.

BA: How do you mean?

BC: Well, they did put-throughs and they hadn't got any expenses, and they didn't have to deal if they didn't want to deal; they could dodge it.  And so they just had the put and call of what was going around.  They had a few friends who would give them a turn every now and then - presumably at their client's expense - 'You can have these for so and so, old boy'.

BA: Now you mentioned the firm, towards the end of its existence; it either wanted to go completely with another firm or dissolve completely.  How did one go about looking for firms to merge with?

BC: Well, the senior partner went to four fairly big firms and said, 'Look we're looking for this, what about it?'  John Clark had a very fine name; he knew a lot of people, and he could walk up and say, 'What about it?'  He could go up to Esmond Durlacher and say, 'What about it, Esmond?'  Esmond probably said, 'Yes, I'll take the firm but not so and so and not so and so.'  And John would say, 'No, terribly sorry, if you reconsider give me a buzz.'  He went round and nobody wanted two people, in particular, so I gather.  I didn't really want to know a lot about it.

BA: What was the reaction at the time to the firm ceasing trading?

BC: Astonishment.  It was a very well kept secret, and if a firm that appears to be wealthy - there was some money in the firm - and appears to be trading reasonably, you were surprised.  There was a lot of surprise and a lot of press comment.  

BA: Now the firm of C.D. Clark ceasing its trading, you described earlier how you came to join James Case, which at this stage were running a joint book with a view to possibly, if that was successful, completing a merger.  What kind of firm was James Case?  Was it very different to C.D. Clark?

BC: Not terribly different, no.  The Eglingtons ran it really, and they had a fellow called Ken Preston, who I worked for, who was a food man.  He was a very fine jobber.  He had nerves of steel.  And then some other partners who were probably more aggressive than some of the people in C.D. Clark and the firm appeared on the surface to be well put together, in fact.

BA: How did you find it, going into a different jobbing firm?  Were you accepted into it?

BC: I was accepted in the main.  In my local area there was a bit of knife around.  But that's alright, I didn't mind that.

BA: Did you find they had a different style of jobbing.  You mentioned some of them were a little more aggressive as characters.

BC: Not really, because I think my jobbing was aggressive; it probably slotted in alright.  

BA: Could you describe what a typical day might have been like for you at this stage of your jobbing career?  Were you living at this house by that stage? 

BC:  Yes

BA:  So when would you leave?

BC: We used a school in the Barbican, for - well, all the children actually - and then they were farmed on.  I would probably take one or two children to the Barbican to the school and then go and sit in the trading floor, so I used to start fairly early.  I used to catch a tube or a bus and then dump them down and run like hell.  And just then work through the day, as it were.

BA: And what would the day's routine be like?  When was the House opening?

BC: The House was opening at 9.30, so I'd try to be in by about quarter to nine, and then you'd be looking through your books, reading papers, chatting with people, sometimes you got a direction to do something or other and then you put your books under your arm and walked down to the House.

BA: When you say 'direction to do something', would that come from your senior partners or...?

BC: Yes, from the main senior partners, [who] would say, 'We hear that....' or something like that, or 'You've got such and such a stock, be careful because we hear something's going on, or whatever.'  Any bit of tittle tattle that's going on would be passed down.

BA: Were there particular times of the day that were busier than others?  

BC: Yes, initially, [in] normal markets, your first half to three quarters of an hour would be much busier because a lot of people were not only trying to do business, but trying to check prices, which at times was a great nuisance.  You'd also want to be on the pitch a bit early in case there was a phone call from outside people who've got something to talk to you about, rather than in the office.

BA: Who would those people be? Brokers?

BC: People you know; yes, brokers, or funds or something like that.   There was a certain amount of communication between fund managers and jobbers.

BA: Oh, really?

BC: Yes.

BA: I knew that the manager of the BP pension fund would like to do his business with Jack Durlacher?

BC: Oh, yes, he was Jack Durlacher's great pal.

BA: But I didn't realise there was other contact.

BC: There was a certain amount, yes.  You built up a relationship just by chance.  You'd get invited out to lunch and so and so was at lunch, a fund manager, and you'd start chatting; you'd find you'd got a rapport and he'd say, 'Do you mind if I phone you.'  Because I moved on from food.  There was a bit of a schemozzle going on and the leader book, as we called it then, was in a bit of a state and somebody had to pick it up.  Well, I stood next door to it and it had lost a lot of money and I said, 'OK, I'll have a go.'  I picked up a chap with me who had been a blue button of mine, who I had great accord with and I admired his talent, and I said to him, 'Look, come and join me, because if we can't do this we shouldn't be here.  He said, 'Yes.'  We did it for about four or five years.  The leader book then..., well Gerald Lederman was opposite me in one book, Wilson-Stephens, do you know him?

BA: Yes.

BC: Durlacher, he was another one.  I can't remember who was on the Bisgood book, but they were a tough bunch, and you were sort of battling away.  You never made much money, but you never lost much money.

BA: These were things like ICI, Courtaulds.

BC: Courtaulds, Fisons, that kind of thing.  And it was known as the leader book.  It did actually show the way the market was going.  It doesn't now, but in those days it did - in say the '70s, early '70s, mid '70s - the leader book showed the way.

BA: And you would occasionally speak to the fund managers?

BC: They'd come on to me. I wouldn't go on to them.  One or two of them but not many.

BA: What would they want to talk about?  

BC: 'What do you feel about it?  Let's get a sensible jobbing point of view of it.'  I was totally honest: I either would say, 'I think it's going up,' or 'I think it's going down,' or 'I don't want to know'.  Probably I was right seven times out of ten.

BA: This might be a difficult question but did they ever ask a broker to book bargains to you on the basis of the strength of your friendship?

BC: No, or not that I know of.  It probably did happen, though.

BA: But you wouldn't be made aware of it?

BC: No.  But other people were doing it, other firms were doing it, obviously.  I mean take that old Jack, what's his name - BP man - Butterworth.

BA: Do you think a jobber could give a different sort of perspective, different market information to a broker?

BC: Unlikely, anything's possible, though.  It depends on your rapport.  A lot of this is psychological warfare or psychological love, shall we say, you've got an accord.  And if you've got a great accord with somebody and things are rolling along, you'll open your heart a bit, won't you.

BA: Did you find brokers would come up and ask you your views on a particular stock?

BC: Yes. I don't know why, because we didn't do any research; they're supposed to be the research people.  We did a bit of research; obviously, you've got to know a few facts and figures but there's no in-depth look at life unless you picked it up from a broker.  It's different now obviously, because of the one line approach to life now, no dual capacity.

BA: What would be the kinds of things that you'd be telling someone?  Someone would come and ask you what your view was of a particular food stock.

BC: 'What's the turnover like?', for instance.  There was a firm that was hammered, Chapman & Rowe.  They were gambling and of course they couldn't pay for the stuff.  They had various stocks.  They had enormous positions.  They used to turn them over, old and new, and you watched it and you watched it and you watched it.  Say a stock that started at about 45p would end up about 35p and they turned over every account for perhaps 3 farthings or a ha'penny, say a million shares.  They bought them at say 45p and they were down to 35p and they turned over say a million shares seven times for a ha'penny, so they'd got that loss, and the loss on the stock, so it's no wonder they went broke.  

BA: So they'd be doing 'cash and new'.

BC: Cash and new, yes. 

BA: And that would be, in effect, a broker taking a position...

BC: Gambling.

BA: Gambling.

BC: Just gambling, plain, straightforward, and his judgement's bad.

BA: Did you have some idea of what was going on in the market with other firms?

Tape 2, side 1

BC: It was obvious that - I might as well mention the stock; Spillers was this one I'm thinking about - it was obvious there was an enormous turnover and it was obvious that we weren't the only people doing it, so the situation that I have got could be multiplied by three or four.  Recipe for disaster.  With a bit of luck, occasionally they could scramble out, but Spillers I think probably did them in a big way and they went up to the - I don't know if it was the Old Bailey or not - but two or three of them were put up.

BA: Now you've mentioned at one point you ended up picking up the leader book..

BC: Yes.

BA: Were you with Akroyd by this stage or was it still James Case?

BC: No, it was Akroyd.  

BA: Did you find jobbing lead stocks was different to jobbing the food stocks?

BC: Yes, it was, definitely.  They were so volatile and the opposition was far stronger.  They had the toughies on the leader books.  'Jumbo' Wilson - have you heard of him? - he was a big fellow, very good rugger player.  He was with Durlacher.  He was brilliant and he was a tough nut to job against.

BA: Could you put a bit of flesh on that?  Can you remember particular experiences when you were competing with him?

BC: No, not particular; but generally the lead in the leader positions could change from one firm to another in half an hour.  If I'd suddenly got something in ICI and Courtaulds the others hadn't got, I could run riot and they could do the same.  And the thing changed: as trade went on you'd think, 'I've got this absolutely right,' and about ten minutes later it was absolutely wrong because somebody had seen something else that I hadn't seen and there was a reversal of situation.

BA: Were they very liquid markets, did you get a lot of two-way business?

BC: Yes, reasonable, but obviously if you'd got a bit of news that was very violent news, it would push the leader market up or down, violently.

BA: What would you do in that situation?

BC: Try and cover; reduce your exposure; just cut and start again.  The old adage: 'The first cut is the best cut' - you've probably heard of that.

BA: Now, after two years at James Case, the merger with Akroyd was completed, and you'd been running joint books with them previous to the merger.

BC: Yes, but joint book meant our losses as it were, not that they were running a book as well; a joint firm thing - they were gilt jobbers and we were equity jobbers, so our losses or profits went into their accounts, I suppose, or half of them.

BA: How did you find the merger with Akroyd?  Was it difficult, were they, particularly coming from the gilt market, a different style of people?

BC: Yes, oh yes; they were far more up-market, shall we say.  And also some of them were infiltrated into the equity side.  I don't think any names can be mentioned.

BA: Is that because it worked or it didn't work?

BC: Well, there were one or two hiccups, put it like that.

BA: Yes.  And how was the new merged firm organised?

BC: Well, Ronnie Quirk who was with G.D. Atkin (that's Michael Sargent's ex-firm) was supposed to be head of the equity side, and obviously Merriman and Peppiatt were the gilt specialists and LeRoy-Lewis was the boffin.  LeRoy-Lewis wasn't a jobber, he was a brilliant [man].  He's got a computer here, not a brain, and a tough character.  

BA: Did it make any difference to your jobbing on the floor of the House?  Did you have more money at your disposal?

BC: We had more money, obviously; yes definitely more money.  And I think we were more flexible.  But the thing had to be put together.  There was a lot of dross in the system; a lot of people who really weren't worth their salt who had to be slowly but surely pensioned off, or whatever.  Some of them were quite elderly people and they were given early retirement or something happened; and you gradually eliminated, or gradually eliminations happened, and people who'd shown style as much younger people were moved in.  There was a constant assessment, obviously of the individuals.  And as the firm was successful - the Akroyd firm were very successful, making very reasonable amounts of money and at times very, very good money - they were in a position to make redundancies, and i.e. be generous in payoffs.

BA: How would you describe Hugh Merriman as a senior partner?

BC: Quite brilliant, absolutely brilliant.  You probably know he was a Colonel, a young Colonel. He had a tremendous War and he had a style and manner about him that was totally different to what you normally meet.  For instance, on a Friday we used to go up to - this was when we were in Moorgate - we used to go up and have a partners' lunch, as it was called, or executives' lunch: and so you just carved a bit of meat and sat down.  Hugh Merriman normally arrived at this and would turn up at between one and ten past and we had a little room about this size where we were having a drink or two before lunch, and everybody stood up.  You automatically [did], you didn't think, 'Do I have to stand up?', you just stood up.  He was absolutely to the point when he was addressing the meetings that we all attended.  He didn't mix his words and he was absolutely straight down the line; he didn't exaggerate, he just put the thing straight down.  And he was very, very understanding.  Although he was a disciplinarian, he was incredibly understanding, I thought.  

BA: Did he have a particular vision for Akroyd & Smithers?

BC: Oh, undoubtedly because he started after the War with a firm R.M. Long, who were taken over by Akroyd.  I don't know whether there was a power struggle because I wasn't there, but he was soon senior partner and everybody was backing him.  And then he picked out various people: he picked out Brian Peppiatt, he picked out Tim Jones, I think, David Lloyd Thomas - have you heard of him?

BA: No, I haven't actually.

BC: He was taken out.  He was a bit on the network.  He was in the Irish Guards I think it was, and also I think he was aide de camp to the governor of Jamaica and things like that.  So he was an unusual man, incredible sense of humour, lovely man.  And he was picked out, I think.  Nick Kimber was recruited - did you hear about him?

BA: No.  Did Hugh Merriman mix much in the City?  Was Akroyd a well-connected firm?

BC: Yes, very well connected.  I think he was probably very careful about where he mixed.  He was a gilt man basically; he was the guru of the gilt world and he obviously knew the bank very well; he knew the discount houses very well; he knew Mullens very well; people who were hierarchy in the top firms.

BA: How would you describe Akroyd, now just before it became a public company?  Where did it fit into the hierarchy of jobbing firms?

BC: I would say it was number two even then, and I think it overtook Wedd Durlacher, definitely, because Wedd Durlacher, the sons hadn't got the bottle that the fathers had, is probably the right way of putting it, or too much bottle.  They hadn't got the mettle of some of the original founder-members of Durlacher and then Wedd Durlacher.

BA: Did you find life with the second or the largest jobbing firm in the Stock Exchange during the '70s and early '80s was different to life with, say, C.D. Clark in the '60s?

BC: Oh, yes, very different.  The whole style of it was different, the trading activity was different and your style of living was different.

BA: Could you elaborate.  What was the difference in the trading style?

BC: Well, you had more freedom.  Although you obviously had to be careful in exposure of money, because you were exposing far more money, greater sums, but you had more freedom.  Okay, supposing you get a big deal in say 2 1/2 million something or other.  You perhaps wander over to say to Michael Sargent, 'I've got this one, I think it's right.' He said, 'Well, do you think it's right?' 'Yes'. 'Well get on with it!'  That was a Hans Anderson fairy story in the old days.  So there was more freedom.  But basically you had to be right, obviously you had to be right, and you wouldn't put it up if you didn't think you were right.  But you may get a view from somebody you're asking advice from really that it's wrong, therefore you wouldn't do it.

BA: How did your career unfold?  You mentioned earlier that you became a partner shortly before the firm was listed...

BC: Yes.

BA: Did you stay on the same jobbing book?

BC: Yes, I was on the food book.  And then this hiatus happened on the leader book and then I moved over to there; I never went back to foods.

BA: Did you stay with the leaders the rest of your career?

BC: No, I then went on to second line stores and a mixture of things.  Another point from my career is that in about 1976, '77, I said, 'The blue buttons we are getting are absolutely useless.  Why do we have people in the office interviewing and giving us blue buttons when they don't know the first thing about jobbing?'  Well the answer was 'You do it'.  So I did.  And I recruited every blue button from that moment onwards.  There was a team of three of us - I'd got two other pals - and I consciously took two people who were different to me, and different from the other one; and our age difference was something up to ten years, ten years, ten years.  So we all had a different outlook. And we used to sit down and two of us perhaps would start the interview, and then you might get somebody back and then the three of us would interview; and then perhaps we wanted to do a big intake so we'd get say ten of the most likely ones up and the three of us would sit down and go through them over a day.  And it worked.

BA: Why had the quality deteriorated?

BC: Well, I don't think it ever did deteriorate, it was always terrible.  Because they didn't know.  You'd got a fellow who was running the accounts ledgers interviewing for a job on the floor of the House; it's a different world - it's chalk and cheese isn't it.

BA: What did you look for in your blue buttons?

BC: What was in me.  I knew what I wanted; I couldn't describe it.  But you're looking at everything: you look at the bloke when he walks in; practically you get an experience of seeing the bloke come in and you know more or less if he's OK or he's not OK.  The difficult one is the medium one who doesn't come across right but he might have something, so you have another look at him.  And eventually, at one point we had 50 trainees, which is a lot of people, and you had to manipulate them and move them around and listen to their sob stories and pat them on the back, kick them hard and it worked jolly well actually.

BA: Did you find that a company structure was very different to a partnership structure?

BC: When we changed into public status I don't think things changed very much.  Things were ticked through rather than sit round a table and discuss it.  Really the basic running of the company was done by the top directors who made the decisions and then passed them down.  You may get asked what you thought in a particular situation, but not generally. Fair enough.

BA: And how was this large number of jobbers, or Akroyd & Smithers, actually organised on the floor of the House?  Were you divided into departments?

BC: Oh, yes, each area: food, chemicals, breweries, you name it; and we had about 35 books, each with their own particular section.  I know the building book particularly well. There are about 30 leaders, so you had a leader book of 30 and then you'd got about 140 say stocks. Although they're not active all at the same time, it's too many for one book, so you had two second line books.  And each book had a number one and a number two, and probably the overall consideration was that each book ran itself and was responsible for itself.  Each book had its margins to work on and each book had to return its P & L regularly, rules about writing the prices right, etc, etc; discipline in life in fact. 

BA: Did you find, as Akroyd was one of the two big firms, that there was more pressure on you from brokers to deal in a large size?

BC: Yes, 'It's laughable, you can't make it in that number, come on now'; too big.

BA: Is that the way you coped with it or dealt with it?

BC: Well, it depends who it was, a bit.  You mentioned Peter Rylands.  Well Peter Rylands is a fairly forceful character and you'd have to negotiate round him, but you wouldn't send him packing, especially as he's Cazenove.

BA: Could that be a problem that particular broking firms would tend to have the orders and you really wanted to do those orders and you didn't want to see them going to Wedd Durlacher or Smith or whatever?

BC: Yes, in the main.  Some of the ones that you don't do are the best bargains you do do.  You think, 'Thank God I didn't get involved in that one'.  You've got to take the rough with the smooth.  The end product of what you do is what happens over a half year, or a year - do you make a profit or don't you make a profit?  The return on your capital involved is obviously very relevant.  And everybody expects you to make a real wrong'un at times, because it's nature that you can't be right all the time.  You only hope that ones that really go wrong aren't the biggest ones.

BA: By this stage, about how many firms were you competing with?

BC: 1970, 1980?

BA: During the '70s.

BC: During the '70s. Well, really you were only basically competing with say, half a dozen firms on the straight forward UK equity side.

BA: Did you find that that was adequate competition or did you feel pressed by the competition from them?

BC: No, that's OK and in fact I've always said you want really good competition because it keeps you on your toes and keeps you tense and you know what's going on.  If somebody doesn't know what's going on and you're making 103 6 and Joe Muggins is making 93 6 one of you is wrong.  Because then a broker comes up and say, 'You're making me 103 6 but they're 93 6 over there, who's right?'  Well you tend to say, 'Yes, I'm right', and you believe you are right.  So that bloke is messing your market up.  If say we are making it in a reasonable size, which we should be, he's probably making it in a small size.  Therefore a small size quote has got nothing to do with my quote in 50 or 100 or a quarter of million or whatever.  So it doesn't half rock the boat at times.

BA: Did you find yourself taking bigger positions than you would have in the past? 

BC: Yes.

BA: Did that every become a problem?

BC: Oh yes.

BA: Could elaborate on that a little bit?

BC: Well, it's bound to because one or two are going wrong.  If you've got a few more noughts on the end of the bargain, that's the multiplication isn't it.

BA: Can you think of any particular examples?  Did you find yourself in a similar position to what say Smith New Court or Kleinworts recently have had, with positions in companies who suddenly find themselves in trouble?

BC: Not me because we didn't do it then.  This is a fairly new one.  It did happen but, as far as I'm aware, it's a fairly rare thing to do.  But the size quoted is obviously very relevant to your capacity to finance it and to handle it.  And how long have you got to play with: can you afford to sit on it for a month?  You might be dead wrong after two weeks and making a hell of a profit after four weeks.  Each one has to be gauged separately.  

BA: Did you find that spread agreements were things that were beginning to....?

BC: There's always been arguments about spreads and people close them up and widen them out.  I don't know quite what happens now because I've lost touch with it.  But the agreements on spreads - there's always somebody who twists it and turns it according to how their state of mind is at the time.  

BA: So in effect, even if there may have been a spread agreement, jobbers were making different [prices]?

BC: You can get round it.  If you are making 4 6 and the bloke says, 'I don't like that one', you say, 'Well, they're 5 7 to you mate.'  Or that could have [happened]. I don't say it would necessarily happen.  Because if he still can't deal you've what is known as opened him, haven't you?  If he can't deal on 4 6 and he can't deal on 5 7, he's trying to sell them at 6d.

BA: Was this something that you found was happening a lot?

BC: There was always arguments and always will be.  There's bound to be arguments now.  Every time I walked round the trading floor last year, there was always somebody saying, 'These bloody people, he's doing it again, they don't keep to the agreements.'  And if you are on screens, there's still less likelihood that they'll keep to an agreement than if you are all standing in a mob together.

BA: What did you feel about spread agreements? Did you think they were a waste of time?

BC: No, I don't think they were a waste of time; I think they were probably over done a bit.  It depends on the state of the market really.  A jobber actually does need some protection at times, undoubtedly, and in violent markets they need some kind of protection, although your protection is in your own hands.  You always worried, if you widened the spread out, when to close it up again, because you've got to close it up again or else you won't see any business.  In average conditions - if there's such a thing as an average condition - I don't think you can lay down the law too much, but the thing is so changeable that you can have a pattern of what you say this is reasonable to do; and if somebody wants to break it, they'll say, 'I'm going to break it.'

BA: Did put-throughs figure much, in your jobbing experience?

BC: Yes.  

BA: In what way?

BC: I've forgotten the number of the rule - there's a rule about put-throughs...

BA: 90, I think.

BC: Yes, I haven't got a rule book here, I don't think;  no I haven't.  According to the position on your book, if there's a put through, you're allowed to cover a bear and take part of the put-through.  If there's a put-through and somebody has got a limit at the put-through price, you can't destroy the put-through on that limit - that's the biggest one.  So if you're making 100 to 2 and the bloke wants to put-through a million and you've got another buyer at 2, or you think you have but you haven't got it firm, you can't destroy that bloke's put through because you can put them through on 1 to a half, shall we say; but you've got a buyer at 2 or a potential buyer at 2.  Well now you can imagine what happens, can't you? 

BA: Could you explain for the tape?

BC: Can you justify a put-through at 1 to a half in a million if somebody wants to buy 50 at 2?  And there's more rows about put-through than practically anything else, or have been.

BA: Was there a particular time when there were a lot of rows, or was it always a problem?

BC: Always.  Going back to C.D. Clark, I did a put-through that was my first big trembly job.  I did a put-through with a firm who used to lodge next door to us in a thing called Bydand - Bydand Distilleries - in a 100,000 shares.  And the firm next door went broke, so we've bought 100,000, we sold 100,000 so we ought to be level.  But the chap we sold them to said, 'Oh, no, no, no.'  So we've got a 100,000 Bydand at whatever it is, a £1 say, which are unsaleable really at 100,000; so we had to take less and less and less.  Well actually eventually it went through, but it took about three days to clear it.  Now that is another problem of a put-through - you could get stranded.

BA: Did this happen during the Akroyd?

BC: No, this was C.D. Clark.

BA: What I meant was, would you find a similar situation happening?

BC: You could do, yes, unless they've changed the rules; I don't know if they've changed the rules.

BA: Did you resent brokers wanting you to do put-throughs?

BC: No, not really, provided they were reasonable.

BA: You never felt that they were preventing you from jobbing the stocks the way you'd like?

BC: It depends a bit on the size.  It's rather like rigging the market.  The smaller priced stocks, say something between 10 and 15 p, and somebody wants to deal in 800,000, what can you do?  There's a market in a fiver or a tenner.  You can't do anything.  Therefore, if they want to put them through, therefore they put them through down low because they say 'Well they're 10p bid for a fiver or a tenner, what would you bid me for 800,000?'  And you say, 'Run, run away laddie!'  Then of course, when they get put through, they're distributed amongst this bloke's clients at a low price, and then they come in and buy them. They'd want to buy them in the market.  They'd want to buy 100,000 so the price goes up again and, directly they get the price up, plonk, you've got that 800,000 under your belt again.

BA: Was there any way of protecting yourself from that?

BC: Yes.

BA: How would you do that?

BC: Argue, snarl.  Lots of bad language.

BA: Did that generally work?

BC: Well, I think you've got to be aware of what's going on; so yes it would work because you've got to just dig your toes in and say, 'I'm not playing that game.'

BA: Did you find clients were breaking large orders down into smaller blocks and coming to the market with different brokers?

BC: Yes.

BA: Was this a major problem?

BC: Yes, it could be, I mean that Tesco thing I told you about?

BA: And did this occur right up to Big Bang?

BC: Probably.  It probably still occurs.

BA: Now as jobbers, again, was there any way of protecting yourself?

BC: Are you a virgin?  Yes or no?  It's simple language.  If you've got the right language, the right thoughts, the right language and you're looking at a bloke, you can say, 'Is this right, are you a virgin?'  And he's got to answer 'yes' or 'no'. And if he didn't answer 'yes' or 'no', you said 'Push'.

BA: Were there brokers who you simply refused to deal with?

BC: Oh, very few.  I don't think it's a sensible thing to do really.  But you've got to create your stance, just as a broker really has got to create his stance.  If a broker says 'What are so and so?' and you make him a price and he just wanders over the road and checks the price immediately opposite, and you can read the bloke's lips saying '3 6', and you know he's made him 3 6 and he comes back to you, well you know exactly why he's come back to you - you've made 4 7 - don't you?  And you say, 'Sorry, old boy, they're 2 5'.  You can't do that.  As a jobber you got to make yourself the best jobber in the stock and the most pleasing personality; but you haven't got to be weak, you've got to be tough.

BA: Did underwriting figure in you jobbing experience much?

BC: Yes, one always got underwriting right from the word go and I think the unwritten law was you never refused it.

BA: What would happen if you did refuse it?  Why was there an unwritten law?

BC: Well, you wouldn't get any more from the broker.  You're bound to get one that's very touchy.  I see this electricity thing.  They're asking for a cover from the government.

Tape 2, side 2

BA: Yes, was Akroyd important as a subunderwriter, did you feel that there was an obligation on you?

BC: Yes, very much so, totally.

BA: And how did you feel about the underwriting?  Did you regard it as something that a jobber should do?

BC: Yes, definitely; it was part of the game.

BA: What about takeovers and a stake building, and dawn raids and things like that, did that figure much in your jobbing experience?

BC: Well, Akroyd did the first dawn raid - Consolidated Gold - and there was a tremendous hooha about it.  It probably laid the basis of rules being developed about dawn raids and there are some fairly stringent rules now.  But there weren't any rules because nobody had done a dawn raid before.  

BA: When was that?

BC: Consolidated Gold... '82, something like that.

BA: How did it work?

BC: We just went into the market and bid for stock, and got it.  Bid up, you see, lifted the price right up and got - it was Oppenheimer wasn't it - and we got, I can't remember what the percentage was, but we got a fair percentage of what we were after in about quarter of an hour.  

BA: Why did that create a hooha?

BC: Because a poor old lady in Torquay who had got 200 shares never knew the price had gone up, something like that.  That's one of the bleats; you can see it's viable, morally it's viable, but it isn't practical.  

BA: Prior to that, did you find yourself involved in takeovers as a jobber?  

BC: Yes.

BA: What would be a jobber's role in a takeover, can you think of any particular examples?

BC: Well, keep making a market and then on your book you run a cross book.  Tesco bid for Phillips, Phillips Stores or something ages ago, and we were running a cross book and Tesco pulled out.  We were losing money on both stocks because one went up and one went down, where they [should] have gone down and gone up.  So you've got to watch that.  So the great thing is, if you get involved in a takeover, you don't run a cross book till a thing is authorised – i.e. it's absolutely storm proof.

BA: Could you describe a cross book, again for the benefit of someone who is listening?

BC:  A cross book is when you are running a bull, i.e. you've got stock, on the one side, and you're running a bear on the other.  So eventually you're going to only have one stock.  So your bear position ought to be priced higher than your bull position because it's going to come down and join the bull and the bull's going to disappear, or partially disappear.  Or you might even end up a bear, if the bull isn't big enough to cover the bear.  

BA: Did brokers ever actually involve you directly in a takeover or in a stake building?

BC: I think in a stake building, yes, but I never came across that. Yes, I'm sure.  Yes, must have done.

BA: The other series of questions I wanted to ask was really to do with the relationship between jobbing on the floor and the back office.  Did you find in the course of the day, you would have much contact with the back office, either telling you to get rid of stock they didn't want to pay the full stamp duty on?

BC: Yes.  The back office should have fed you that particular type of information anyway, and dividends.  You ought to be warned about dividends, the back office being what we called a stats department - or used to call.  But you ought to know when your dividends are due because it's no good being a bear of say BP dividend - which is enormous - and you've got to pay the whole lot. It's a very costly business.

BA: Did the liaison with the back office or the stats normally work well?  I mean somebody in the back office at Durlacher said a lot of traders, while they may have been good traders, basically weren't terribly bright and so the communications would break down.

BC: Yes, I think the traders think they're sacrosanct, probably, and they don't take a lot of notice.  But if you ask quite a lot of the traders who should know what various things are about settlement, etc, etc, they haven't got a clue probably.  As long as they make a profit on buying and selling they think that's the end of the job, but it isn't.  There is a sort of educational system all the time trying to get them to see what they've got to do.

BA: We've already mentioned the institutions and the sort of contacts simply to exchange information, one of the things that is said about the 1970s is that there began to develop a market in stocks and shares outside of the Stock Exchange.

BC: Yes, there was one, but it eventually didn't amount to anything.

BA: So you didn't, as a jobber, feel threatened by [it]?

BC: No, we had this thing Ariel.  Ariel was really a non-entity.  It was matching bargains - 100,000 of this against 100,000 of that - so it wasn't trading, it was really matching bargains on a computer. It was a red herring, Ariel, really was.  And everybody panicked when it came out.

BA: Did you panic when it came out?

BC: Well, I couldn't see how it could work, frankly, personally.  A lot of money was pumped into it to boost Ariel and [to] become a member of Ariel, so that the people who were members of Ariel got the information that there's a 100,000 of this and a 100,000 of that, do you want to do anything?  And it did do a bit.  I actually had a very good friend who ended up managing director of Ariel.  The thing disappeared, about two years ago is it?

BA: Yes.  The '70s was also a time of very volatile markets and there was the boom in 1972 and then a very severe recession in..

BC: '74.

BA: '74.  Do you have any memories of that time?  Was it a difficult time to be jobbing in?

BC: Yes, very difficult.  And the interesting thing is that when it turned round, I think we ought to have seen it better, that it really was going to take off and if it didn't take off the whole place was finished anyway.  That's an exaggeration, obviously, but when the index hit 164, was it? - something like that - it really was desperate.  And then the Burmah stake went.  And that actually rang a bell.  It was the usual panic stations - they were either going through the roof or they were going to drop to zero.  Excess of emotion pushes these things both ways.  But it was very, very difficult, especially at that time of year because a lot of people were drawing lines to close their accounts etc so they didn't want to buy and they didn't want to sell, and they didn't want to do anything.  So there was no hope of actually closing your book, if you wanted to close it; the only answer was to keep a very, very slim book, if you could.

BA: Which stocks were you jobbing during that period, '74?

BC: Leader book, yes, I can remember that, because I got crucified once.  

BA: Do you think you can talk about that?

BC: I'd rather not.

BA: How did one job when stocks were falling?

BC: Well, you tried to run a reasonable bear position.  You've got to balance your book; you don't want a ratio of 5:1 bull:bear, you want a ratio of even or 2 bull to 4 bear, or something like that.

BA: How did you go about finding buyers?

BC: Dropping the price.  If there weren't any buyers, drop the price and then directly you sell them, drop it again and hope for the best. 

BA: Did it ever seem the market wouldn't turn around?

BC: Well, at times you really think it won't, especially if you were really a big bull; you'd get clobbered and you can't give the stock away.  It's a very tense situation, very tense.  

BA: By this stage, also, there were far fewer jobbing firms.  Did you ever think about the jobbing sytem writ large and did it ever seem that single capacity wouldn't be able to survive?  What I mean, was it ever an issue that you as a jobber thought about, or were you still jobbing day to day?

BC: No, I think we were jobbing day-to-day in the mid '70s definitely.  It took a long time to get there didn't it?

BA: Yes.

BC: I mean you wanted a really good crystal ball to see that coming in 1986.  You're looking ten years ahead, aren't you.

BA: What were your feelings when in '82 there was this accord between between the government and the Stock Exchange over abolishing fixed commissions and opening up the Stock Exchange, and eventually getting rid of single capacity?

BC: Well, it was inevitable, because we were following the world markets, weren't we; really it had to happen whether you liked it or you didn't like it, and you really had to aclimatise your thinking to accepting it.  You probably didn't accept it initially.

BA: So did you not accept it initially?

BC: I think I did, actually.  I wasn't taking a very strong view either way, but I think I accepted the fact that it had got to happen.

BA: Had you stayed on the floor of the House right up to the end of...?

BC: No, not right up to the end.  1983/4 I think I came out and I took on a lot of administrative jobs: I was still running the recruitment.  And then on Big Bang I went back because we left about 40 traders on the floor in the minor stocks and they wanted somebody to go down to supervise it and take the flak when it happened.

BA: What was that like?

BC: I couldn't stand it because I didn't understand...  I'd done a course on the screens and everything and I thought 'I just can't wander round doing nothing, I'll stand with a book'.  So I stood with a book; it wasn't me.  I was so set in my ways from thirty odd years of it that I couldn't quite take it; I just wasn't with it.

BA: How would you contrast the floor of the Stock Exchange when you went off the floor to go into the more administrative things to when you first started as a jobber?  Was it very different?  Was jobbing very different, were the people different?

BC: People later were obviously very much younger.  The aggression is very much bigger, the pressure is very much bigger.  I thought in '74, 'we've hit the bottom now, you can't get any tougher than this', but you can and did.

BA: How do you mean?  In terms of trading or competition?

BC: On you, pressure on you as an individual, survival.  

BA: Were you enjoying it less?

BC: No, I've enjoyed it all the way through actually, or I wouldn't have survived.  I think most people who have done it for some years have obviously liked the challenge of what one does - it's you versus them.  It's rather like getting in a plane, Battle of Britain - it's either him or you - rather than getting in a bomber.

BA: You've mentioned some of the qualities required to be a successful jobber already, were there any particular qualities that you would have said were the most important?

BC: Well, you've obviously got to have a very quick mind, you've got to be able to make decisions, you got to have an outgoing personality - extrovert - it's no good hiding away, you've got to have a balance of your personality that can handle the other person's personality, and obviously that's a great variable - your's isn't but the other bloke's is.  So you've got to have a certain psychology to recognise how to handle somebody who's being a bit difficult.

BA: Was a jobber a very different person to a broker?

BC: Oh, yes.  Not many people go from broking to jobbing; far more go from jobbing to broking because the pressure isn't there.  When you think everything you do as a trader is risk, it's total risk: if you buy 100 shares at £1, you've got to get a £1 and two pence from them to make a profit.  If you get 90p for them you've made a jolly good loss on a hundred. And, as I said before, put a few noughts on the end and it gets pretty rough going.  And you've got to walk away from the place, get a good night's sleep and come back and fight it.  You can't do anything at three in the morning waking up, 'Oh my God, what am I going to do tomorrow?' Because if you do that very often there won't be any tomorrow.

BA: Who would you say had been the outstanding jobbers in your experience?  You've mentioned the particular person at C.D. Clark who inspired you.

BC: Yes, he was very good.   Peppiatt was absolutely brilliant, Michael Sargent's very good, Pitcher's very good.  Anybody near the top now has got to be very good.  They may have a slightly different way of handling things, especially at the top now where... Michael doesn't make any prices any more, but he's still got the gut feeling of he wants to trade.  It's in him, he can't get away from it, it's in him.  Anybody who is near the top of the ladder is very good.

BA: Did you know much more about the other jobbing firms by the end?  Did relations improve?  

BC: Oh, yes, they did.  Very much so.  Definitely one fought in the '60s and probably yes one fought in the early '70s, but by the time the pattern of life was obviously coming through into big units I think everybody realised there was a problem of personality clashes and they're just plain stupid.  And in fact there were jobbers' meetings; we used to sit round tables and bang things out and if there was a problem with a particular broker and two jobbers had suffered, that broker would be invited to have a chat and would find there were two jobbers looking at him, not one.  

BA: Did you know much about the smaller jobbing firms?  The only reason I mention it is that two of the firms at the end of single capacity who haven't come up in any of the interviews are Harold Rattle...

BC: Harold Rattle was very small.  I knew them quite well because they stood round the corner from us.  But they were ordinary.

BA: What did they do?

BC: Well, Rattle did some equities and I think they had a Kaffir book.

BA: And the other small firm who I haven't really come across but I know were around, was Pulley.

BC: C.T. Pulley, yes, just small and disappeared, bit of a joke really.  Well, no, not a joke, but they didn't have any influence really.  They couldn't do because they were struggling in hundreds of thousands of pounds where the rest of us were struggling in millions, so how can they have a great influence, you'd just take them out. It's rather like the smaller gilt firms: there were two gilt firms really...

BA: .....yes, the two main ones you mean.

BC: The two main ones, and if the smaller gilt firms got into a mess, they used to go to the big ones and say, 'For Christ sake, get us out of a mess.'  

BA: Would you say, then, that the Stock Exchange in the end was not perhaps as competitive as it may have been?

BC: Oh, it was still competitive.

BA: It was?

BC: Oh, yes.

BA: Did you have, maybe it's difficult to know, but did jobbers tend to make the same prices, did you find that you were making the same prices as Wedd?

BC: Well, you don't know.  Your price is obviously going to be close to Wedd, or close to anybody else's because if it isn't somebody's making the wrong price - the automatic law of averages means the thing must close up because somebody's going to do something and the thing closes up, or one jobber goes and challenges the other and says, 'You're making the wrong price.'

BA: What would you have said had been the strengths of the single capacity system? If someone from New York, or wherever, Frankfurt came and asked you, 'Why do you have this jobbing system?' what would you have said?

BC: I don't know - 'We've always had it' - I suppose is the answer to that one.

BA: Would you say it had any weaknesses?

BC: Well, the weakness is that we were losing international business because we weren't big enough, and this putting together of big houses has made us competitive.  What's going to happen, one might ask, when the Japs really roll their sleeves up and get cracking; because I'm told that Nomura, for instance, can takeover every major bank in London without batting an eye lid.  So, there's no doubt about it that the going has got quite a lot to do with flexing your financial muscle.  If you sit down and play poker and some bloke's got a thousand quid and you've got 50 quid in your pocket, you're not going to win, are you?  It's force of numbers.

BA: Reviewing your career in the Stock Exchange, was there ever a time when you would have considered going out and doing something else?

BC: No, I don't think so, no.  Because I'd had a good look at various aspects of life and I'd elected strongly to go there, and having settled in there, I enjoyed it immensely and I liked the comradeship of the floor of the House, it suited me.   I couldn't stand sitting in an office.  When I came out of the Stock Exchange as a trader - I used to wander back - I was like a fish out of water to start with because I didn't know what to do with myself. I was  scratching around in all sorts of things that one had to do, but my mind was back where I spent a long time.

BA: Did you find the world at large knew much about what a jobber did?

BC: No, they hadn't got a clue.

BA: So was it a slightly special career?

BC: Jobbing is special.  It's rather like money markets, they're special aren't they? Or commodity dealing, if you've got a commodity that is swinging around the place, it's all the same thing.  But, it is special and it is a special type of person.  I couldn't be a good broker, I just haven't got the patience to be a good broker; I wouldn't contemplate being a broker, absolutely not - I'd rather till the soil, I think.

BA: I think we can finish on that note.  Thank you very much.