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No wonder. In a world in which exchange rates change from minute to minute, money traders must constantly try to outguess their fellows. They scan Reuters and Dow Jones electronic display screens for up-to-the-second news. Suppose Teamsters Boss Frank Fitzsimmons makes a statement in the morning about how big a wage boost U.S. truck drivers will demand next spring. What are the chances that he will get it? If he does, what will happen to the U.S. inflation rate vs., say, the inflation rate in The Netherlands? How many holders of dollars will be prompted by the news to sell how many bucks? And what will that do to the dollar-guilder exchange rate? Based on his own instinctive answers to these questions, the trader — cambist, to use the international term — must decide within seconds whether to sell tens of millions of dollars for guilders right away. Or maybe wait until the afternoon, tomorrow or next week to act, or possibly even buy.
The pressure is unrelenting, and there are not many experts at the game. The volume of currency trading is six to ten times what it was only a few years ago; banks and currency firms have been forced to hire hordes of eager young men and women as traders. Most now practicing have only two years or so experience and their average age is under 30. They "burn out" in a few years. Even their bosses, the senior cambists, are rarely as old as 50 (Levy, the owner of his own currency-trading firm, is 49).
Unfortunately, the rule for making money has become: when in doubt, sell the dollar. Cambists unanimously cite three reasons for this: 1) there are just too many dollars (some $600 billion) floating around the world, the result of decades of U.S. balance of payments deficits; 2) the U.S. inflation rate, which is rising while rates in other countries are falling, gives holders of the dollar no confidence that the currency will retain its value; and 3) the Carter Administration has not convinced anyone that it can bring either U.S. inflation or the balance of payments deficits under control.
So long as those conditions prevail, the traders will be deluged with orders to sell. And they can eventually find another cambist to buy. Since the dollar is the world's primary currency, someone always needs bucks. A French oil refiner, say, has to pay for a shipment of Saudi crude, which is priced in dollars; a German investor needs dollars for a farm that he has just made a deal to buy in the U.S.
The selling comes from many sources. Recently some of it has originated in OPEC countries (Kuwait, Iran and Algeria) and in Communist countries that have accumulated dollars dealing with the U.S. and might now be selling to embarrass America. But the main dumping is from two sources: