The year was 1985 and the first of the Mulroney budget cuts had arrived. Those of us in the trenches were uneasy, particularly after a missive arrived from upper management strongly suggesting that staff who could make themselves commercially useful to the outside world, do so. In response, a number of us who were otherwise engaged in mathematical pastimes in pursuit of nuclear research, put our thinking caps on. The question was – “What do we have to sell and what do we need?” and the answer was obvious: “computer expertise” and “money”, in that order. The next question was also obvious – “Who has money and needs computers?” A not-so-difficult train of thought quickly led to an answer to that one as well: banks and the brokerage industry. Thus was MathShop born, a small group of mathematically oriented AECL researchers – Mike Milgram, Stephen Douglas, Bill Selander, Paul Lee and Mike Carver – who were going to hawk our wares to the financial world.
This was not a new idea – at the time we were aware that Wall Street in the US had become a mecca for unemployed mathematicians and physicists, who were creating hedge funds and trading empires employing that new technology now known as “financial engineering.” So we got to work, in a naive sort of way, by mailing letters to each of the largest financial institutions in the country offering the services of Mathshop. And we waited for the replies to come pouring in.
After a few weeks with no response, our enthusiasm was diminished, as was our resolve. Then, much to our surprise, we received a reply from a large brokerage firm, suggesting a modicum of interest. A long-distance telephone discussion followed (in those far-off days, any phone call to other than the 584 exchange was a notable event) during which it became clear that our understanding of what was on offer and what was desired did not exactly mesh. Consequently, one beautiful summer day, I found myself on a Pem-Air flight bound to Toronto, on a mission to learn what were the needs of our first possible client, so we could tailor our offering.
I arrived at the Bay Street offices of the firm in good time and met my contact, a bond trader who had recently transferred from the US and therefore knew about the valuable contributions being made by those unemployable, but now employed, scientists. This should have been my first clue that all was not as it seemed, since my intent was to offer a computer program to trade options – a new market development at the time – and I had no idea why anyone would want to trade bonds, let alone make a living doing so. Well, I was there to learn, and the second thing I learned from the architecture of their offices, was that this company had dollars to burn, just as we suspected.
The main office occupied the two top floors of a skyscraper, with a vast curved wooden stairwell linking the reception area with the office areas above. We ascended the stairs and arrived at a conference room with a large table, a few chairs and a large window overlooking Lake Ontario and the roof tops of the financial district below. After a few moments of perfunctory discussion, one of the doors opened and a man came in, seated himself and said nothing. “Who’s he?” I thought. A few seconds later, another man arrived and seated himself and then a third, a fourth and more – I don’t recall how many. Then, much to my surprise, each of them introduced themselves to each other. “Hi, I’m V.P. of trading”, said one. “Pleased – I’m Director of …” said another, and my thought was clear but unspoken – “Do these guys really all work for the same company? Well, at least I’m going to find out a lot of details about what they need.” Of all the things that transpired that afternoon, those two thoughts are crystal clear in my mind.
After some time, when everyone who had been invited to the meeting had arrived and introduced themselves (to each other), my contact stood up and introduced me, in words I’ll never forget: “This is Dr. ….. He is visiting us from Atomic Energy in Chalk River and he is going to tell us all the things that they can do for us”. To this day, the remainder of that afternoon is a blank.
A few days later back at the plant, we put two and two together and decided to go with our initial thoughts – Mathshop would offer to write a computer program that would trade options, since we all understood the mathematics and technology of such a program. My contact, who was still talking to us, (so I must have said something interesting) seemed mildly enthusiastic, so we prepared a proposal, assuming it would require about 3 months of technical development and priced it accordingly. When it arrived at the next level of management, we learned all about overheads and the need to finance the buildings in which we were housed and the power to run the computers. Our offering price doubled. And then it arrived at the desks of upper upper management where we learned that the overheads had overheads so our price increased yet again. Finally we sent off a proposal to our putative client with an astronomical price tag, and were unsurprised not to hear back. After this event, both our enthusiasm and resolve diminished to nothing and Mathshop eventually faded away.
[Anyone with a story of other unusual off-normal work at Canada’s nuclear laboratories is invited to forward it to us at info@nuclearheritage.com.]
