Joe Ritchie

During a period in the 1980s, CRT was doing more options trading than any other firm in the world. In a 1986 article “These Traders Made All-Star by Hitting Singles,” Business Week reported “Those singles, razor-thin-profits on millions of transactions each year, makes CRT a perennial all-star.”[8] CRT monitored those millions of transactions with a computerized system that was far ahead of the curve. By 1988, CRT's initial stake of $200,000 had grown to $225 million.[6] By 1993 CRT had grown to over 700 employees.

Ritchie's unique perspective translated into every area of his business, from the way he viewed his employees to unique investment strategies. Trader Monthly said of Ritchie, “ Joe's ability to look ahead not just six months, but several years, is second to none.”[2] This perspective helped him see commodities and stocks that were undervalued, but it also translated into an ability to recognize people that were undervalued.

Ritchie hired traders that were able to think outside the box. Bud Hunt, former CFO of CRT, told the story of Ritchie eliminating a potential hire based on a quick glance at his resume. “He looked at it for about 5 seconds and then said “Not interested! He has three strikes on the first line, his first name is an initial, there are three Roman numerals after his last name and he has an MBA.”[2] Ritchie looked for people that might not have had the right degrees but could think for themselves.

CRT had a unique business style as well as corporate culture. In 1988, Risk Magazine reported, “CRT is known for its idiosyncratic operating style as well as for its unrivalled trading technology. Management is non-authoritarian, work is supposed to be fun and employee competition is shunned. For the most part, CRT looks outside the financial industry for employees and especially avoids MBA types.”[9] A CRT employee observed, “Applicants for employment are viewed more like candidates for adoption... others look for the best heads. CRT looks for the best hearts.”[9]

Ritchie sold CRT to Nations Bank (now Bank of America) in 1993 for $225 million. In that transaction, CRT was advised by investment banker Bruce Jackson, CEO of Carver Cross Securities Corp. and formerly of Brown Brothers Harriman.[10] After selling CRT, Ritchie remained at the forefront of trading as the head of the Fox River Partners LLC and Fox River Execution.

In 2002, Fox River partner, Keith Dickson, purchased 138 acres (56 ha) from the Howard Hughes’ estate, which included the Cahuenga Peak where the famous Hollywood Sign sits.[12] This section is the last undeveloped, privately owned ridge in LA and the highest point of elevation in the area. Hughes bought the land in 1940 with the hopes of building a romantic gateway for him and his girlfriend Ginger Rogers.[13] Dickson said, “We kind of feel we got a Van Gogh at a garage sale."[14] Trust for Public Land, a nature conservation group, bought the peak from Fox River.[15]

Ritchie began doing business in Russia during the Cold War with creation of a company, Management Partners International or MPI, which became the American partner in the second ever Soviet American Joint Venture - JV Dialogue, founding in 1987 and by 1992 the company had become a network of 110 subsidiaries in various fields ranging from JV Dialogue to Dialogue Bank and real estate and architecture, with nearly 5,000 employees. The MPI General Manager was Jack Byers who lived in Moscow and worked as a team with Pyotr Zrelov the General Director of JV Dialogue. Among other things JV Dialogue was the exclusive distributor for Microsoft products for two years and Steve Ballmer came to Moscow to announce the relationship. During that time the company sold MS products throughout its network of affiliates as well as converting MSDOS and MSWorks to the Russian language. Bill Gates came to Moscow for both product announcements. The company affiliates in 26 cities across the Soviet Union. Through its network JV Dialogue represented a number of western technology products and eventually created a JV named Summit Systems, located in Minsk Belorussia current day Belarus, with Chips and Technologies being an American partner and Aeroflot being the prime Soviet partner. Summit Systems produced personal commuters, these personal commuters being quite clever, which were then sold primarily through the JV Dialogue network. JV Dialogue provided three course hot lunches for all employees as prepared by a chef trained at the Culinary Institute of America.

Ritchie was happy to let the Russians run dialogue. International Business magazine quoted Ritchie; “I don't know how to make money over here (Russia)--they do.”[3] Harvard Business Review stated, “Ritchie stepped into the background, making it clear to employees, vendors, and government officials that he had fully empowered them to run the show.”[19]

Ritchie started working in Japan in 2001 with two brothers, Chris and Brian Oxley. They launched a variety of businesses in housekeeping and service management that brought American know-how, but also focused on bringing pride and dignity to people's work.[18] Service jobs in Japan are typically looked down upon, but these ventures provided training and equipment that encouraged employees to take pride in their work.[19]

In 1989, Ritchie committed $30 million of his own cash to buy Eastern Airlines when it was about to go into liquidation due to financial setbacks and strained union relations (partly due to the aggressive management[20] of owner Frank Lorenzo).[21] In partnership with the unions, Ritchie's plan to take over Eastern Airlines involved the unions taking a 50% pay cuts.[22] The Atlanta Journal-Constitution said this of his potential purchase, “Mr. Ritchie could save an airline integral to the history of the US flying, and place an important brake on the present molting habits of the airline industry.”[23] A Bankruptcy judge denied Ritchie's plan and Eastern Airlines was liquidated.

In 2000, Joe and James, along with Robert McFarlane, President Reagan's Security Advisor,[25] met with Abdul Haq (Afghan leader), one of the most successful commanders in Afghanistan during the struggle against the Soviet Union in the 1980s. With Abdul Haq, the Ritchies worked to create a strategy for Afghanistan to transition into a more democratic and modern society with the help of the former Afghan King Zahir Shah.[26] The Ritchie brothers and Abdul Haq enlisted the former King “to serve as the catalyst and moral foundation of the process.”[25] The former king and his council voted unanimously to accept Haq's plan in Afghanistan.[25]

Stephen Kinzer, reporting for the New York Times in 2001 wrote “Before Afghanistan became a focused attention, James and Joseph Ritchie spent much of this year trying to persuade the Bush Administration to embrace their efforts.” Peter Tomsen, former special envoy to Afghanistan was quoted saying in reference to the Ritchie brothers that they “went into a vacuum left by the US Government. We had no policy on Afghanistan in the two Clinton Administrations and the Bush Administration didn't pay attention to Afghanistan until September 11.”[27]

Some of the plan was never put into action, due to the death of Abdul Haq in 2001. The State Department later said, “We know the Ritchies were working with Abdul Haq and other Afghans...we have no objections at all.”[28]