Paul Meier, the longtime chairman and now honorary chairman of the Swiss Futures and Options Association, has written a tribute to his friend and SFOA colleague, the late Paul-André Jacot, who passed away last week.
The tribute is about Paul-André, but it is also about the SFOA, its history and the Bürgenstock conference. While Paul-André has left this world for the next, the Bürgenstock conference still hangs on despite many predictions of its demise.
The SFOA and Bürgenstock are part of my history too. Bürgenstock was my first overseas conference as the writer of this newsletter back in 2004. It was a magical conference, and both Paul-André Jacot and Paul Meier helped make it that way. Carol Gregoir, the longtime secretary, helped as well. The Chicago Board of Trade played its part in the history of the SFOA, according to Pat Catania, a longtime CBOT executive who served as vice chairman of the SFOA for 10 years.
In this tribute, Paul Meier talks about the “futures scandal” of the late 1970s surrounding the silver market and trading that occurred from Switzerland. At the time, much European trading came from Switzerland because many European countries still viewed futures trading as gambling.
The real issue Paul Meier does not name was “position limits.” The CFTC wanted to know what traders in Geneva were up to, but according to Paul, the CFTC was not using “airmail” to send requests for information. I have never heard of a slow boat to Switzerland, but I guess it was a thing. Anyway, this was before faxes (at least at the CFTC) and there was no such thing as email, and phone calls were expensive.
I can only imagine someone at the new CFTC yelling, “Hey, who has a girlfriend in Switzerland they are calling every Friday? It’s costing a fortune! Cut it out!” A budget-starved CFTC behind the times technologically – some things never change.
The Swiss Commodities Industry Association, later the Swiss Commodities Futures Association, and finally the Swiss Futures & Options Association, was formed in 1980. Pat Catania would become active in the mid-1980s. Paul-André participated from the start, joined the board in 1984 and became its longtime CEO in 1989. He retired just last year.
The SFOA was established to be a voice of European traders about position limits and, according to Catania, to give a customer perspective from Europe. Of course, they did not want any position limits and found the position limits suggested by the CFTC to be too small.
You have to go back to this time in history in Europe and Switzerland. The only exchange in Switzerland was the old stock exchange. There was no futures trading regulation in Switzerland as there was not a futures exchange there until 1988 when the SOFFEX launched. The CBOT was the big dog exchange with over 50 percent of the global futures volume. Its dominance would diminish every year despite its own growing volume. It was an amazing time.
As new exchanges sprung up around the world, and financial futures were introduced, Bürgenstock would grow in importance. Being part of SFOA and the Bürgenstock conference offered legitimacy to firms operating in Switzerland. Exchanges and firms would send their top leaders to confer and meet. And because the conference was held on a mountain top, there was nowhere to run.
Amid all this global growth, Bürgenstock was the place to be for new exchanges and old. And Paul-André would make it happen for all of them. Getting people together from all over the world into a friendly, collaborative, informative and inviting environment is a significant thing.
However, today the Bürgenstock conference has lost its historical caché amidst global domination of the exchange business by derivatives exchanges, widespread consolidation in exchanges, banks and brokers and a move away from the most beautiful spot on earth I have ever been. Of course, competition hurt it too, as the Futures Industry Association would come to dominate the global futures industry event business later and push Bürgenstock into the shadows.
Bürgenstock was special because of its location, but also because of people like Paul-André. He worked hard to make each year different, interesting and topical. Each year Paul-André and the SFOA would find a nation/exchange to be the event host. Besides being a smart event financing move, it allowed participants to learn about different cultures and countries. He and the SFOA helped create the global community in the industry, which I value so much.
The SFOA is trying to reinvent the Bürgenstock conference, but it is an almost impossible job because of the historical importance of the conference, its now former magical location and the loss of people like Paul-André who were there helping this industry grow into what it is today.
It is time for the SFOA to forget about what the Bürgenstock conference used to be and discover what it can be.
I have decided to attend the Bürgenstock conference this year, not because it is currently a great conference, but because it could be one again in the future. And I will go to honor the memory of Paul-André. Whether we realize it or not, we all owe a debt of gratitude to Paul-André and others like him who helped build this industry into what it is today. The greatest tribute we could give him would be to attend this year and help find a way to make the Bürgenstock conference truly meaningful again.