March 20, 2023

Frequent Flier: Flying When Your Name Is Prominent, but You Are Not

I was chief executive and president of Fox Music for 18 years, and in that position I was flying all the time, too. The locales got a little more exotic, from small Czech villages one week, to Australia or Thailand the following month. Now that I’m out on my own, after starting Kraftbox Entertainment last year, I’m still flying a lot.

The big difference is that I no longer have a big corporate travel office to make my reservations. Now I do it on my own, and honestly, I’m not particularly good at it, which is really embarrassing and humbling.

A few months ago, I needed to fly to London from New York City. I went online and bought my ticket, selecting a flight that left Kennedy Airport for Heathrow at 7:40. At about 4 that afternoon, I looked online to see if my flight was on time, and noticed that the Web site said, “This flight has already departed and arrived.”

I rebooted the site, assuming it was inaccurate. When the same information came up again, I called the airline, intending to let them know their Web site was wrong and they were experiencing some kind of computer glitch.

I made my call, feeling pretty righteous, only to be very politely informed that the flight indeed left Kennedy at 7:40. But that was 7:40 in the morning, not 7:40 in the evening, as I thought. The agent had the good grace not to laugh. I felt stupid.

Since I missed the flight, my entire itinerary, including my return flight to my home in Los Angeles, had been canceled. I elected to postpone my trip, and bought a coach ticket back to Los Angeles later that evening. It felt like a very long flight.

Everyone is thinking about Boston. The tragedy just plain hurts. I love that city and I’m sad. I’m praying for wisdom and strength.

I fly to Boston a few times a year for meetings, and occasionally benefit from the fact that I share my name with the much more famous Robert Kraft, the owner of the New England Patriots. A few years ago, I flew from Los Angeles to Logan Airport in Boston a few days before a big Patriots playoff game.

As I boarded the plane, an attendant said, “We are so thrilled and honored to have you flying with us.” She mentioned that “everything has been taken care of,” and ushered me into a first-class seat. I asked no questions. I’m a frequent flier on this airline and thought maybe they were being exceptionally generous, except deep inside I think they thought I was the other Robert Kraft.

It got weirder when I landed. I usually take a cab to Cambridge, but my flight arrived late at night. It was freezing, so I hired a local car service. I waited on the platform as every other cab and car drove off, until I was finally the only one left outside, except for a long, black stretch limousine.

After a few more moments in the Arctic temperature, I tapped on the limo window and asked the driver who he was waiting for. He said, “Robert Kraft.” I said, “I’m Robert Kraft.” The driver gave me a withering gaze and said, “No you’re not.”

He knew what Robert Kraft looked like and he didn’t look like me. After some back and forth and a peek at my driver’s license, the driver relented and I got my ride. Beautiful, wonderful Beantown. I love it. And that driver.

By Robert Kraft, as told to Joan Raymond. E-mail:

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DealBook: $440 Million Loss in Glitch Imperils Trading Firm

4:01 p.m. | Updated

$10 million a minute.

That’s about how much the trading problem that set off turmoil on the stock market on Wednesday morning is already costing the trading firm.

The Knight Capital Group announced on Thursday that it lost $440 million when it sold all the stocks it accidentally bought Wednesday morning because a computer glitch.

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The losses are threatening the stability of the firm, which is based in Jersey City. In its statement, Knight Capital said its capital base, the money it uses to conduct its business, had been “severely impacted” by the event and that it was “actively pursuing its strategic and financing alternatives.”

The losses are greater than the company’s revenue in the second quarter of this year, when it brought in $289 million.

“With the events of yesterday, you have to question if this is the beginning of the end for Knight,” said Christopher Nagy, founder of the consulting firm KOR Trading.

Timeline: Trading Errors

Shares of Knight Capital closed down 63 percent, at $2.58, on Thursday. On Wednesday, the shares fell 32 percent.

The problem on Wednesday led the firm’s computers to rapidly buy and sell millions of shares in over a hundred stocks for about 45 minutes after the markets opened. Those trades pushed the value of many stocks up, and the company’s losses appear to have occurred when it had to sell the overvalued shares back into the market at a lower price.

The company said the problems happened because of new trading software that had been installed. The event was the latest to draw attention to the potentially destabilizing effect of the computerized trading that has increasingly dominated the nation’s stock markets.

Until this week, Knight had been one of the biggest beneficiaries of the evolution of the market, helping clients trade in and out of stocks at high speeds. The firm was responsible for 11 percent of all trading in American stocks between January and May, according to Adam Sussman at the data company Tabb Group

On Thursday, Knight said that none of its customers had been hurt by the errant trades.

Still, the trading glitch is especially uncomfortable for Knight’s chief executive, Thomas Joyce. Mr. Joyce, 57, has been at the helm of the company since 2002. Now that his firm is in the spotlight, it’s embarrassing for Mr. Joyce because he was a vocal critic of the hiccups that upended the Facebook public offering in the middle of May. At the time, Knight suffered $35.4 million in losses because the trades the company was making in Facebook shares weren’t registered by Nasdaq for hours.

Knight was founded in 1995 and went public in 1998 after quickly becoming one of the largest middle men, or market makers in the stock market. Knight founded DirectEdge, a company that is now the fourth-largest stock exchange operator in the United States. Knight sold stakes in DirectEdge to other Wall Street firms and now owns only a minority stake in the company.

Knight has become known for executing trades on behalf of retail brokers like TD Ameritrade and ETrade. It is the major player in the business along with UBS, Citibank and the Chicago firm Citadel.

Mr. Nagy of KOR Trading, who used to work for TD Ameritrade, said that large retail brokers were likely to find alternatives if Knight were unable to continue taking in new business. But he added that Knight had “unmatched” connections with smaller banks and brokers, and those smaller firms may have trouble immediately finding a replacement for Knight.

Knight had recently been increasing its business and reported having 1,418 employees as of the end of the first quarter of this year in 21 locations around the world.

This post has been revised to reflect the following correction:

Correction: August 2, 2012

An earlier Homepage headline about the Knight Capital Group developments referred incorrectly to the company as a hedge fund. It is, as the article correctly notes, a trading firm.

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