Duffy Visits NYSE, Site of 2002 CME IPO, Which He Called One of HIs Biggest Achievements

In the Inside the ICE House podcast series, Josh King of Intercontinental Exchange really does a good job of warming up the audience and the interviewee, as well as with the subject matter. He does such a good job, he was able to get “the Mike Ditka of the exchange business,” Terry Duffy of the CME Group, to visit the New York Stock Exchange and sit for a terrific interview on both of their parts.

Such was the way King, a New England Patriots football team fan still smarting from the spanking given to his Patriots by the 1985 Bears in Super Bowl XX, described the veteran trader, broker and exchange leader Duffy. The interview was recorded shortly after the most recent Super Bowl, and King described the global competition around the clock between ICE and CME as the Super Bowl of global exchanges.

For his part, Duffy described King as the Chris Berman of ESPN, eliciting a laugh from King. 

This was the best interview I have ever heard Terry Duffy give. He was relaxed, outgoing, forthcoming and engaged with King in a conversation that is in the sweet spot of his life’s experiences and interests. 

Duffy took the CME public in 2002 at the NYSE and he described it as “one of the biggest achievements of my career” at the time. 

Duffy was incredibly gracious to King and the NYSE staff, reflecting on the experience of taking the CME public on a day when the NYSE trading floor was still crowded with traders, just like at the CME. 

On December 9, 2002, the day the CME went public, Duffy noted that the exchange was experiencing just under 1 million contracts of average daily volume. Today, the CME Group trades over 23 million contracts per day, Duffy said.  

In 2003, the CME was highlighted in the NYSE Magazine with the title of “Merc to the Market,” with a picture featuring Terry Duffy on the cover. King presented Duffy with a framed copy of the magazine for his office. Duffy indicated he already had the picture in his home. 

King and Duffy discussed Duffy’s family background, including his grandfather John Duffy, who served as a Chicago alderman and president of the Cook County Board. John Duffy was a golden gloves boxer and widower who was a World War I veteran, while Duffy’s father was a Korean War veteran. Duffy said the Korean War took something out of his father.

They also spoke about the time George W. Bush came to the CME a week before 9/11. President Bush described the CME as “entrepreneurial heaven.”

Duffy discussed getting more involved with the CME becoming a public institution and how some members were backing away from having a liquidity event, but everyone was happy after it happened. 

The interview touched on Chicago mayoral politics and how public safety has become such an important issue. Duffy noted that his own wife was carjacked in Chicago at 3:00 p.m. Duffy said this is not an issue for just the city, but it is everywhere – the suburbs and in the country as well. 

Duffy said he believes “social media is the black plague of modern society” while commenting on the issues causing the safety problems. 

There was plenty of well-plowed turf about Duffy’s career in this interview, including a reference to the bar Chuck’s in Fontana, Duffy’s mentor Vincent Schreiber, and Duffy starting as a runner. What was new to me was the fact that Duffy’s mother forged her husband’s signature to the loan documents to mortgage the Duffy home/bungalow so Terry could buy a membership. 

He retold losing $150,000 on a misheard trade, but offered the details that it involved a buy/sell error on a one hundred lot cattle order, which moved substantially against him as he was trying to get out of the error and get the right position filled. Duffy said it took him three years to pay it back after Schreiber backed him with his name but not his money. 

The interview also covered ground about the people who could change with the times and those who could not. It covered how the economies of scale allowed the industry to grow into the global marketplace it is today. 

They recalled a famous lunch at Sullivan’s Steakhouse between key players from the CME and the CBOT and how things had not really changed much from 1970 to 2007. 

There were stories about MF Global, Lehman Brothers, FTX, Bitcoin, Congressional testimony, retail trading and more in this interview. It is worth listening to.