APT8 at Brisbane’s GOMA

One of the world’s great long running art exhibitions has opened again in Brisbane. The eighth Asia Pacific Triennial is a once every three years showcase of the best and most vibrant art from the Asia and Pacific regions in one of the best art galleries in the world: Brisbane’s Gallary of Modern Art or QAGOMA as it has renamed itself (Queensland Art Gallery/Gallery of Modern Art). The name may be awkward but there is nothing awkward or forced about the art, which is true reflection of the most vibrant part of the world.

Whether the exhibition is dealing with post Soviet trauma in Central Asia, life in the Bangkok banlieus or Aboriginal nationhood, APT8 brings a refreshingly deep perspective that is an antidote to the bland isolationism of modern Australian life. APT is the flagship exhibit of QAGOMA and its eighth incarnation emphasises the role of performance in recent art, with live actions, video, kinetic art, figurative painting and sculpture “exploring the use of the human form to express cultural, social and political ideas, and the central role of artists in articulating experiences specific to their localities.” There are works from over 80 artists and groups, with ongoing performances and projects, a conference and cinema programs, publications and as always, plenty of activities for children.

Asim Waqif creates large scale installations from leftover and found objects. Waqif was born in Hyderabad, India in 1978 and now lives and works in Delhi. His work All We Leave Behind dominates the entry space to APT8. Prior to the exhibition Waqif visited Brisbane to learn about the history of building and demolition in the city. He collected worn timbers typical of south-east Queensland construction and used nooks and crannies of art gallery space to construct an edifice that is labour intensive and unplanned but also inviting. Waqif is fascinated by the concept of waste. In a 2013 interview he compared waste to archaeology. “One can speculate about the habits of a person by looking at the waste he/she generates,” he said.

Eddie Mabo was probably the most famous person to come from the Torres Strait island of Mer (formerly known as Murray Island) but an important elder on the island today is Segar Passi. Passi began painting in the 1960s, observing sealife, birds and weather, and painting portraits, daily life, and Creation narratives. Passi encourages people to be mindful and respectful of their environment,  important social and cultural practices and knowledge. His works study the volcanic islands off Mer and Passi references the physical features of the islands and their geological evolution. His paintings speak of a profound and culturally embedded knowledge of place, with geological links to the ancient volcanic landscapes of Papua New Guinea.

Burmese artist Nge Lay‘s large-scale installation The sick classroom (2013) came out of years of research and regular visits to Thuye’dan, a village ten hours north of Yangon (Rangoon). With husband and fellow artist Aung Ko, Nge Lay established the Thuye’dan Village Art Project in 2007 which shared art of the villagers working with some of the most successful artists in Myanmar. Nge Lay also worked closely with local craftspeople to create sculptures that are the basis for her recent sculptural works. The sick classroom features life-size carved wooden sculptures of the classroom, the teacher and 26 first-year students. The installation is a call for better rural education in Myanmar.

Paphonsak La-or’s realistic drawings and paintings are critiques of the politics and history of his native Thailand. ‘Silent no more’ 2014-15 features empty landscapes around Fukushima and Futaba abandoned after the 2011 tsunami and 2011 nuclear disaster. Through Google Maps, La-or discovered a connection between these uninhabitable but lush landscapes and his frustration with the political situation in Thailand around the 2014 military coup. La-or emphasises the contradictions between the peaceful Japanese scenes and the Thai turbulence using jarring text rendered in dust.

STAB is the School of Theory and Activism, Bishkek in the capital of Kyrgyzstan. STAB is an artistic, research and activist platform informed by Soviet avant-garde art and activism. STAB runs animation workshops on dominance of the Russian language in Central Asia, urban development, and post Soviet homophobia. STAB also examines the Kollontai commune, a Soviet era queer communist and feminist collective associated with the architecture school in Frunze (now Bishkek) in the 1970s.

Rosanna Raymond draws on her New Zealand, European and Samoan heritage in the multi-art installation and performance event SaVAge K’lub. Savage Club was a British 19th century gentlemen’s club but Raymond’s K’lub places more emphasis on the VA’ within SaVAge, a term invoking Samoan philosophical understandings of space. This, says Raymond, “is an active space. It is activated by people. It binds people and things together. It forms relationships, and reciprocal obligations.”

Leang Seckon lived through Year Zero and the Khmer regime in Cambodia. A generation of artists was wiped out leaving a visible gap in the country’s contemporary art. Leang’s dense paintings have lush tapestry-like surfaces, that combine myth, popular culture and history. Hell of Tuol Sleng 2014 depicts a high school that became a notorious prison and death camp. “In 1977, when I was about seven years old, I had a serious fever and I fainted and was taken to a hospital near Tuol Sleng,” Leang said. “When I went to shit behind the building, I saw troops wearing black uniforms taking a very skinny person, almost like a ghost, to plough the fields. The person couldn’t even walk, but the soldier hit him and brought ants to bite him. The person fell onto the rice field. I hid beside a small group of trees and felt horrified.”

Like Paphonsak La-or, Navin Rawanchaikul is a Chiang Mai Thai artist who draws inspiration from Japan. Navin exhibited in APT2 (1996) and his panoramic figurative paintings draw on film posters and murals. APT8 features ‘Tales of Navin 1–4’ 2013-15 capturing the many stages of his career accompanied by a letter From Navin to Navin (January 2, 2015) that reflects on his relationships, love and death. These include the death of his mentor Thai artist Montien Boonma and Rawanchaikul’s trips to Australia to assist Boonma in the 1990s.

Guangzhou artist Duan Jianyu’s playful work uses erotically charged imagery and humour to parody Chinese and colonial life. Her faux-naïve style owes to Revolutionary Realism and the French Barbizon school portraying rural peasant women carrying giant geese with snaking, phallic necks echoing European modernist ideas into China post-Cultural Revolution. She draws attention to tensions between urban and rural, and tradition and modernity in a society undergoing enormous change.

Chilean-born Australian painter Juan Davila has six works in APT8. They draw on references including 19th century Parisian advertisement posters with Davila devising his own typefaces and fonts. Hung as a group they address the treatment of refugees and asylum seekers in Australia using barbed wire and people of mixed gender and races.

Mongolian artist Gerelkhuu Ganbold’s painting Soldiers Who Don’t Know Themselves (2013) is a vertical triptych, depicting mounted horsemen in armour riding through a vast desert space. On close inspection the armoured suits are either empty or inhabited by skeleton figures, sitting up on their horses in a ghostly way. Gerelkhuu draws from Mongol zurag painting and equestrian art, and contemporary comics and science-fiction cinema. His horde recalls Genghis Khan while also commenting on modern Mongolia which is rapidly urbanising and undergoing economic overhaul.

APT8 is free at QAGOMA, Southbank, Brisbane until April 10, 2016.

Islamism and the West: A new reign of terror

A ripped picture of Syrian President Bashar al-Assad hangs in the northern Syrian city of Raqqa following the fall of the city to the Islamic State on March 5, 2013. Raqqa is now the capital city of IS. (Photo credit MOHAMMAD AL-HUSSEIN/AFP/Getty Images)

The sight of Brussels in continual “lockdown” is a sobering glimpse of the future. The tenuous contract between freedom and equality is on a slippery slope equality’s way and we are all becoming equally enslaved. The cause of the imbalance is Islamism, the largest threat to “western” (a word that has no geographical meaning as modern Chinese and Indian people aspire to be the “West” as much as Americans and Europeans) civilisation and dealing with it will become the thorniest global issue over the coming decades if not centuries. I don’t know why we are so surprised at this as 9/11 showed in horrific live global pictures the extent Islamists are prepared to go. It is war, where we like it or not, and whether we recognise or not who the “enemy” is.

It is also a problem that is not going away anytime soon, regardless of how well the West “copes” . While random easy target attacks with guns and bombs are not as as wicked an economic problem as the effects of climate change with its catastrophic results to the planet, the outcomes posited by Islamism are a more potent and direct threat to centuries of science and innovation. The notion that climate change is a fraud is easier to defeat as the weight of scientific evidence becomes insurmountable in the 21st century. But even supporting science or calling our times the heuristic “21st century” is inimical to Islamic terrorists.

Terror is an overworked word but is accurate to describe the sense of fear crucial to the work of terrorists. The notion is not exclusive to Islamists and is as old as human society. The power of ancient Rome was enforced by terrorism of its own people while the French Revolutionary Reign of Terror enshrined violence as a political right. State terrorism was a core tactic in both world wars, especially the second as en essential element of the Total War mentality leaders saw as necessary for victory.

In the late 20th century, terrorism became associated with non-state actors in asymmetric battles against the power of the state. Growing up in the political complexities of Ireland it was easy to see how one person’s freedom fighter was another person’s terrorist. But central to the strategy of all of these groups was that soft undefended targets were legitimate within the confines of their “wars”. In particular tourism and tourists became targets, both as a easy mark and also as symbols of the mass consumption that defined western society.

Islamists have taken this strategy to the next level in their battles against the West. The idea that tourism becomes unsafe and therefore untenable is a central concept in their war. You are a legitimate target whether you are in a hotel in Bamako, a beach in Tunisia, a rock concert in Paris, a pub in Bali or a plane over Sinai. The activities that mark out daily routines are slowly denormalised and with them, the assumptions that drive life in the West.

Terrorist actions are inescapably political, a fact the West prefers not to understand. Neither side in the traditional left-right divide of western politics understands how to deal with the problems posed by asymmetric warfare. The right is quicker to see Islamism’s threat but its simplistic solution of keeping Islam out and “closing the borders” belongs to less mobile times. The West is post-Christian and imposing a religious solution on secular societies has no chance of success. The borders are a hangover from the 19th project of nationalism and nationalism has few answers to global jihad.

The  other side practices its own stupidities. So determined is the liberal-left to prevent the effects of divide and conquer promoted by the right, it is blind to the causes of Islamism preferring not even to speak of the religious dimension that drives its actions. Their reluctance is understandable, not wanting to drive an artificial wedge between Muslims and non-Muslims. But ignoring causation will never address the problem. The fact IS supporters practise their religion in a way that horrifies most liberals does not make it any less Islamic. When a British Muslim intellectual states it is lazy and wrong to say Islamism has nothing to do with Islam, she is castigated by non-Muslims as a Zionist in disguise. But as she argues, “the repugnant creed of the Islamic State is certainly related to Islam – but it is also inimical to Islam”.

It is not just Islamic State that is the problem, though they have succeeded in their avowed long-term media strategy. Jihadis view themselves as warriors against western imperialism and across the world Islamist groups invoke Allah to drive murderous projects. Boko Haram in Nigeria is even more bloodthirsty than IS, and the aim of their project is reflected in their name which means “western education is forbidden”.  It mounted 453 attacks in 2014, killing 6644 people – “the most deadly terrorist group in the world”.

There are others in similar guise across the Muslim world: Al Qaeda in the Islamic Maghreb  (ALIQ) in northern Africa, Al Qaeda in the Arab Peninsula (AQIP) in Yemen, Al Shabaab in Somalia , Islamic State, Al Qaeda and their proxies in the Middle East, Taliban armies in Afghanistan and Pakistan, Lashkar e Toiba in Pakistan and India, Jemaah Islamiya in Indonesia and Abu Sayyef in Philippines. They have a ready stream of adherents and are well-funded and well organised often by supposed “allies” of Western nations. The Salafist and Wahhabist strains of Islam, as practiced by some Gulf nations, Saudi Arabia in particular, are utterly intolerant and want only a world in their image. They can only be defeated by the populations in which they live.

There are no easy answers for the West. Media castigation of Muslims in their midst sells papers but is counter-productive. Military intervention is catastrophic and must be avoided. Even a peacekeeping mission has the potential to be badly misunderstood. Democracy has not taken root in Muslim countries and authoritarian regimes – backed by western nations for their own cynical purposes – have hollowed out civil societies. Jihadism with its easy illusion of divine sanction has filled the void, with a simplistic message often compelling to those disenfranchised in the west as it is to Muslims.

Islamic State must be allowed to be seen for what is it: A cruel, despotic and capricious regime that gives its elite a lucrative regime from smuggling oil, drugs and other contraband aroind their black economies. Those that live under IS and other intolerant Islamist regimes need time to find out the dictum that democracy is the worst possible way of organising the world – apart from all the others. Whether the people under Islamist flags ever get to see that, depends on the politics of the West: the right avoiding weapons and bigotry and the left not avoiding reason and rationality. We are a long way from both and the war goes on. IS and their ilk have much room to grow before they being destroyed by their own absurdities.

Dark Paradise: A short history of Norfolk Island

As Dark Paradise author Robert Macklin says, all nations lie about their past. Whether it is Turkey lying about the Armenian genocide, Japanese ignoring war crimes, Americans glossing over their slave-owning Founding Fathers, or Israelis invoking ancient Hebrew lore to justify savage oppression of Palestinians, nations across the world turn history to their agenda. The British, says Macklin, are masters at whitewashing their past with a cheer squad of intellectuals heaping praise for the way they brought civilisation to the world, while ignoring the pillaging of Africa and their attempt to turn China into a nation of drug addicts.

Australia learned well from Britain and the predatory conquest of a continent has been hidden behind admiration for British law and order. Macklin’s tale is about the savagery underpinning the Empire’s expansion into a tiny neglected corner of Australia: Norfolk Island. Around 1500km east of Byron Bay, Norfolk Island was the first place that empire expanded after Sydney and its story incorporates three fascinating strands: the dark stain of convictism, the aftermath of the mutiny on the Bounty and the sexual predations of the High Anglican Melanesian Mission.

Captain James Cook discovered Norfolk, though not on the same voyage as his 1770 journey up the east coast of Australia. He was on his second voyage in 1774, a vain journey to find the fabled Terra Australis Incognita, when he arrived at the north-west tip of the island. It was a short stay but its significance lay in the discovery of wild flax which Cook believed was a natural raw material for canvas sail. The great pine trees that dotted the island also looked perfect for masts and spars. Britain had neither commodity and was forced to import them from Russia. “The discovery may be both useful and valuable,” Cook wrote.

After the upheaval of the American Revolution, Britain turned its attentions to the south Pacific, not for sails but jails. In 1788 the First Fleet set up a prison colony in Sydney and within 18 days of arriving, Governor Arthur Phillip dispatched Lt Philip Gidley King to establish a settlement on Norfolk with 15 convicts, five free men and two marines. They arrived on Leap Year Day and took five days to negotiate the reefs to a safe landing.

King had eyes on the flax and pines, and also on one of the six convict women in his new colony. He was unaware – it was not discovered until late 20^th century – the island was previously colonised by a group of seafarers from north New Zealand or the Kermadec Islands using double-canoes. Between the 13^th and 15^th centuries they survived on fish and birds before mysteriously disappearing. They left behind the New Zealand flax and the Polynesian rat.

The rats were joined by European stowaway rodents from King’s ship and together they ruled the ecosystem of the island. King had a more immediate problem. The island’s pine trees were too brittle for masts and spars while King’s men did not have the technology to convert flax into canvas. Sexual tension replaced early enthusiasm, with men outnumbering women three to one. King codified 11 commandments into laws including the need to “behave devoutly” and the puzzling “no exchange of clothing”. The rats and hot winds played havoc with cultivation and the colony survived on fish. A convict rebellion was narrowly defeated by an informer.

Another British actor in the Norfolk story was also in the south Pacific. Lieutenant William Bligh, a protégé of Cook, was sailing to Tahiti in 1788 in command of HMS Bounty. Bligh’s orders were to turn the island into a slave state to provide breadfruit for the empire. Aboard was Fletcher Christian, a midshipman Bligh promoted ahead of longer-serving hands. They were attracted to each other, though it is doubtful they consummated their relationship.

Bligh found constant carping fault with Christian’s work. The easy Tahitian morals were a profound shock to the straight-laced British crew and Christian’s plotting against Bligh may have begun there. When they went to Tonga, a row erupted over missing coconuts and Bligh punished Christian before inviting him to dinner. In a state of confusion Christian plotted with others to desert, a plan which evolved into mutiny. He led nine men armed with muskets, bursting into Bligh’s cabin and putting a knife to his throat, taking control of the ship. Bligh loyalists were put onto a cutter for an improbable 3600km journey to Timor, while Christian set sail for Tahiti. Facing a hostile reception and worried about British ships, the mutineers departed with 500 pigs and 25 Tahitians going first to Tonga and arriving at Pitcairn in 1790. The island had fertile soil, fresh water, tropical fruits and most importantly, was utterly remote.

Bligh survived his ordeal and was acquitted at court-martial in Britain. King was also sent back to Britain while martinet Major Robert Ross commanded Norfolk. The convicts seethed under tiny rations and draconian punishments for minor infringements. King returned as Lt-Governor to find 700 people on an island riven with violence and theft. Flax-dressers came from New Zealand to make canvas with no success. The Sydney Rum Corps philosophy spread to the island creating a caste system.

Life was no more idyllic on Pitcairn. The colonisers divided into two murderous groups treating Tahitians like slaves while Christian withdrew into a solitary life. The Polynesians rebelled, killing five of nine mutineers before the tables turned and four of them were killed. The effect was to rebalance the sexes and a relative peace broke out.

When King became governor of NSW, his island replacement, former Governor John Hunter’s nephew Captain William Kent was delayed at sea, so Major Joseph Foveaux came over from the Rum Corps. Foveaux got wealthy by pressing convicts into slave labour on his Sydney farm and he took sadistic ideas of discipline to Norfolk. Humiliation and agony were his tools of trade and he wasted no time establishing a cruel regime, which he kept secret from the mainland by censoring mail.

Foveaux was selective in punishments, ruling with informers who got off lightly while some were routinely sentenced to 200 lashes as a mere “feeler”. Others were kept in tiny dark isolation cells in water pits for 48 hours unable to sleep or even crouch for fear of drowning. Women were treated as slaves and bought and sold freely. Doctors and clergymen on the island tried in vain to ease the punishments before a major took exception at Foveaux punishing his soldiers without proper court martial. Foveaux was sent to England but exonerated and came back to Norfolk with a promotion. New arrivals got 25 lashes to show authority and whenever a foreign ship was sighted, Irish prisoners were herded up into a timber building with orders for it to be set alight if the ship landed. Ill-health ended his horrible reign and he returned to England in 1804 as an asthmatic.

William Bligh was now governor in Sydney, but again the subject of mutiny this time by influential landholder John Macarthur. When Bligh attempted to stop the rum trade by arresting Macarthur, his officers sided with Macarthur and put Bligh under house arrest. Colonel William Paterson arrived in 1809 to relieve Bligh. By 1810 American whalers told the world of Christian’s mutineers on Pitcairn while life was generally quieter on Norfolk. The last convicts were removed in 1814 and the island was turned loose to 12 fierce dogs.

In 1824 Norfolk was re-established as an outpost of the “ne plus ultra of convict degradation”. New Sydney governor Ralph Darling enthusiastically ordered the withdrawal of all women to make the island a place of “extreme punishment short of death”. In 1826 a revolt held out for several weeks before its leaders were caught and hanged in Sydney. Another martinet James Morriset arrived in 1829 and he got round the official limit of 300 lashes by imposing the sentence multiple times. Morriset had uncontrollable rages towards prisoners and a lack of interest in running the settlement.

On Pitcairn a new arrival named John Buffett took over teaching and controlled the island before falling foul of alcohol. Another charlatan missionary Lord Joshua Hill arrived, claiming to be sent by the British. He denounced the older settlers and appointed a cadre of sub-rulers to enforce his rule until he too was violently deposed. The islanders were anxious to become part of the British Empire and when Captain Russell Elliot arrived in 1838, he produced a “constitution” Britain eventually recognised in 1887. The island was a regular stop of whalers but became an outpost of the Church of England under George Selwyn.

In Norfolk, there was temporary respite with the benign reign of Alexander M’Konochie. M’Konochie was convinced punishment was counter-productive and allowed prisoners to be treated humanely. They earned freedom by labour and good conduct and the lashings stopped. Governor Gipps would not extend this treatment to repeat offenders on the island, an injunction M’Konochie disobeyed. Once word got back to Sydney he was recalled and the brief reform era ended. The island continued as a gulag of terror until closed in 1855.

The empty island was an attractive proposition for the Pitcairners outgrowing their tiny home. An 1855 poll found 153 out of 187 in favour of moving and they sailed west to Norfolk a year later under a founding document auspiced by Queen Victoria, though some returned after a short while. In 1863 there was another split and another 27 settlers returned to Pitcairn. Those that stayed fell under the power of Selwyn and his Melanesian high church mission. The mission farm became profitable and the island became a benevolent church dictatorship surviving on free labour called “field hands for the Lord”.

In 1897 Governor Hampden issued an order-in-council annexing Norfolk to any federal body which NSW might join. However Norfolk was not included in the new commonwealth of Australia in 1901. Numbers dwindled in the 20^th century and by the 1930s the island was in crisis. An airstrip and radar station were built in the Second World War and the war spurred development. By the 1960s tourism was rising but so were tensions with Australia over taxpayer funding. Norfolk made money by printing stamps but a 1975 High Court decision ruled the island was irrevocably part of Australia and should be included in the electorate of Canberra. The Pitcairners lost their special status and a Norfolk Island Territory Assembly was given powers to raise revenues and taxes.

The tension between Pitcairners and non-Pitcairners still remain about obligations to racial discrimination laws. Norfolk government dysfunction has been a running sore for Canberra, while Pitcairners emphasise their special status. In June Canberra took control of the island ending 36 years of direct rule amid local disgust and mass protest. Governance consultant Gary Russell, a member of the New Zealand UN Association, says he believes Australia cannot continue to act without consulting the founding document. “Even the Crown in England kept reminding the Australian state governments when they kept changing petitions,” he said. “’Have you consulted with the people of Norfolk Island before you instigate these changes?’ and of course this has not happened over the last 160 years.”

The Dark Paradise has not yet seen the light.

The Asylum: How a bunch of rogue traders at Nymex took over the world oil market

The little-known but important story of how potato traders at the New York Mercantile Exchange (Nymex) came from nowhere to set the world oil price is told delightfully in the book The Asylum by American journalist Leah McGrath Goodman. That no one exactly understands how oil prices are set is demonstrated by the book’s transcript of an extraordinary interview between right-wing Fox News pundit Bill O’Reilly and Nymex executive John D’Agostino in 2008.

At the time, the oil price was skyrocketing towards $150 a barrel. O’Reilly wanted to blame Venezuelan left-wing president Hugo Chavez and OPEC’s “greedy sheiks” for the high prices. D’Agostino was having none of it. He told O’Reilly high demand and a low US dollar were to blame. O’Reilly was flabbergasted. “[OPEC] gave Cheney the middle digit… they can change whatever they want, right?” he says. D’Agostino replied, “No, OPEC only set the oil supply, the price of oil is actually set in New York”.

The rest of the conversation is worth reporting in detail:

O’R: Is there a guy who says $125 a barrel?

D’A: No. There’s a huge market that sets the price.  It’s filled with hedgers. It’s filled with speculators.

O’R: Somebody has to put the $125 on the barrel. Who does it?

D’A: They’re getting it from this market.

O’R: Who is “they”?

D’A: The oil producers…

O’R: The CEO of Shell or ExxonMobil says “We’re going to pay $125 a barrel”. Is that what they say? I thought it was the sheiks and Hugo Chavez.

D’A: No, No. They are all looking to the exchanges, the free markets, to set the price. The markets right now are saying the price of crude is about $120 a barrel. It’s going up and gasoline prices are directly related to crude oil prices.

O’R: But somebody has to make a decision.

D’A: It would be great if there was just one person doing that, because then we could go talk to him.

The exchange ended with an exasperated O’Reilly believing he was being hoodwinked. Fox News viewers showered the station with angry emails unable to believe American capitalists were setting the price of oil not greedy Arabs and leftist dictators. But D’Agostino was right. The price of oil is set by anonymous traders off Wall St who thought nothing of bringing the global economy to its knees.

As Goodman said, traders are yellers. One trader told her they yell because they don’t have time to be polite. “It’s a world of super-assholes,” he said. “They’re all dicks, crude, manly men.” They work on the futures market, a scarier version of the stock exchange. Energy traders bet on the price of oil in the months to follow, to a period of ten years. It is precise. Even if you correctly bet prices will go up in a certain year, if you get the month wrong you could lose millions. Traders bet on the future price and also on the difference from month to month in “spread trading”, which they hedge against the outright future bets.

The market was Darwinian where the strongest and loudest ruled. The trading floor was often violent and nice guys didn’t last. Traders were assisted by runners who wore goggles for protection from the constant shower of trading cards raining down on them. Traders were fined $100 for every card that didn’t reach the pit in one minute of trade and expertly flicked cards which arched perfectly before landing across the two-storey high room. Position in the trading ring was crucial because if you stood close to a major trader you had access to all their information.

Nymex was a down-at-heel exchange compared to the New York Stock Exchange. The guys betting on blue chip companies looked down on the shabby traders of minerals and commodities. If NYSE traders took an academic and mathematical approach to the market, Nymex operated from the gut. Overthinking was bad, trading was “freestyle” and the traders were street smart. Porn was common on the floor, as were drugs, and reputedly, firearms. The cops left them alone as they contributed large amounts to the Police Foundation. The traders’ word was their bond and behind their bland trading jackets, there were many multi-millionaires. There were 816 seats in the exchange and they sold for $1.6 million each or leased out at $10,000 a month.

Nymex hijacked the oil market in the 1980s. Before that it was the trading home of the humble Maine potato. For half a century, 70 traders operated out of a redbrick mansion in downtown New York betting on spuds, unaware their world was crumbling around them. A rival market began in Idaho potatoes while Maine’s annual potato crop was falling. The market was corrupt with stories of bags filled with potato-shaped stones and spoiled Maine potatoes arriving at Bronx markets. Worse still, Idaho potatoes tasted better than Maine ones.

Initially this led to volatile prices which traders loved. The wilder the swings, the more opportunity for profit. When the supply ran out at the end of spring, prices would go crazy, with half the market betting prices would rise and the other half hoping they would fall. The trading pit was full of farmers, politicians, bankers and spectators who came to watch the show each May. Traders were obsessed with Maine gossip, Maine weather, Maine soil. Because future contracts were tied to actual quantities, traders had to get in, make money and get out quickly to avoid a pile of potatoes arriving on their doorstep. Traders exploited the expiration date to the last few seconds to end up “flat” in the market without any bets left on the table.

A futures market has practical value. It allowed farmers lock in future profits at an agreed price. It gave them financial stability to plan their business years ahead with price risks transferred to speculators who pocketed the resulting profit or loss. This underlying utility still drives the futures commodities markets.

Incredibly, Maine potatoes were the third most traded commodity in America in 1976. But an enemy at the farmgate was about to spoil Nymex’s party. JR Simplot was an eccentric Idaho farmer, nicknamed the Potato King. When he died in 2008 aged 99, he was worth $3.6 billion, the oldest person on the Forbes 400 rich list. Starting as an onion farmer, he branched into potatoes winning the contract to supply US armed forces in the Second World War and then McDonald’s in the 1960s. Simplot was annoyed Nymex would not trade his Idaho potatoes. In the May 1976 rush he played against the Nymex traders selling millions of dollars of potatoes driving the price down. But unlike the traders he did not go “flat” at the close of trade.

Simplot was left with a contract to deliver massive amounts of Maine potatoes which, to the consternation of the market, he did not have. However he did have plenty of Idaho potatoes which he offered in compensation. Nymex refused to accept his Idaho potatoes and the market defaulted. Simplot was fined $50,000 but busted the Maine market.

Nymex lost legitimacy and most traders resigned. In 1977 they appointed a 27-year-old trader named Michel Marks as unpaid chairman. Marks was the son of a former Nymex trader and a young prodigy. Reeling from the loss of potato futures, the exchange scraped by, betting on odd trades like Australian beef cattle (when supposedly tainted by kangaroo meat, the price oscillated wildly which traders loved). Rival exchange the Chicago Mercantile Exchange (Comex) overtook it and tried to buy cut-price seats at Nymex. The deal went south when Comex pulled out thinking they had paid too much money.

It left Nymex in a huge hole but in the longer term Comex suffered. Marks worked around the clock in 1978 to understand the business. Some traders wanted to bring back a potato market but the Simplot scars were too deep. In any case the market regulator permanently banned potato trading. There was money in platinum and other metals but these markets were not volatile enough to be super profitable. Looking at what was dormant on the books, Marks hit on heating oil.

A far-seeing energy economist named Arnold Safer convinced Marks the free market would eventually set the price of oil. In the earliest days the price was set by John D. Rockefeller with his “barrels”, before a consortium of the Texas railroad and oil majors took over. After the 1973 Oil Crisis, OPEC flexed its muscle but Safer told Marks non-OPEC countries would eventually flood the market with excess oil destroying the cartel. He also advised Marks to only trade things whose prices weren’t fixed by the government. The opportunity came with the deregulation of the heating oil market in the late 1970s. Mark dusted off an old contract to sell heating oil to the Dutch. In an ingenious move, he scratched out Rotterdam and changed it to New York harbour so they could concentrate on local trade.

The futures market for heating oil opened November 14, 1978. Volume was low on the opening day which was not a good sign. “Low volumes beget no volumes” was the conventional wisdom in the trading pits. Marks hassled big traders, energy companies and banks to trade with him but no-one believed OPEC could be challenged. Because Nymex had no history with oil, the industry made the fatal miscalculation of ignoring them.

Heating oil merchants paid vastly inflated for their product while even OPEC struggled to make profit when its oil price did not keep up with supply and demand changes. Private oil companies exploited the difference by hoarding oil contracts, locking in higher prices. They charged $10 more a barrel than OPEC but Marks decided to do the opposite. His heating oil was 20c a gallon cheaper than Exxon. His customers were worried Nymex could not guarantee continuous supply if Exxon found out about the deal and punished them. But cheap oil is cheap oil and enough merchants gave Marks the start he needed. Nymex traders didn’t care about the product or the price, what they needed were sufficient bids and offers to work the gaps.

Word got out about Nymex bargains. Serious corporate customers arrived in the form of drillers, refiners and shippers of heating oil. Within months the daily number of bids went from hundreds to thousands. For the first time, buyers and sellers of heating oil could tell exactly what the price was by looking at the Nymex trading board. It attracted all the US heating oil contracts, turning the exchange into an invaluable source of information. People trusted the exchange because it was a public market and because unlike the oil companies, it did not rely on ever-increasing prices to make a profit.

Things took off in 1980 when the Iraq-Iran war started. When the news broke, 50 traders flooded the ring clamouring for heating oil. Within days the Nymex price doubled and would have risen further but for government-imposed price limits. The low and high price were the same as everyone was buying and there were no sellers. There was a vast underground trade into the higher-priced unregulated market controlled by the oil companies, an illegal practice which flourished without supervision.

New president Ronald Reagan gradually eased price controls and Marks debuted futures on leaded petrol in 1981. That market was so successful it continued for two years even after leaded petrol was banned in the US. In 1983 Reagan removed the final oil price controls and Nymex launched its crowning glory: a futures contract on sweet crude light oil, the industry bedrock. Marks opened a specific market to sell West Texas Intermediate light to the largest oil storage facility in the world at Cushing, Oklahoma.

The dots began to join. US oil production was declining and Americans were cutting usage. OPEC jacked up prices as did the oil companies. But the supply scare caused non-OPEC companies to increase production flooding the market with oil, plummeting the price. Panicked Wall St traders rushed to Nymex to hedge expensive contracts. Nymex became a huge liquidation warehouse selling off oil at bargain-basement prices. The traders made a killing on each transaction. Suddenly power was no longer in Houston, Amsterdam or OPEC HQ at Vienna but at a grimy rat-infested building in lower New York, inhabited by “misfits and pranksters and gun-toting gangsters who had absolutely no knowledge of the oil business”.

Other players muscled in but Nymex’s position was secure. Even the oil companies came cap in hand and openly traded on the market. When Nymex moved to the World Trade Centre the market was so intense, it did not notice the smoke pouring into the room after the 1993 bombing and traders refused to evacuate. Nymex moved out of the WTC before 2001 which was prescient. But it was slower to see the oncoming of electronic trading and almost lost the market entirely to the more innovative Intercontinental Exchange. With Nymex’s power waning they agreed to a merger with former enemy Comex in 2008 and the electronic boards replaced the whirring of paper in the pits.  A handful of traders still ply their wares in a small venue using the old open outcry system of the potato trading days. There are calls for it to be preserved. But Nymex is no museum. Though people like Bill O’Reilly never knew it, its traders still set the price of oil to this day.