Is High Frequency Trading Too Fast for Our Own Good?
“…intermediate traders are backing away from the market at critical times lest they get tricked by HFTs, and all the traffic being generated by HFTs gaming each other is raising the costs for those intermediate traders, accelerating their flight from the market.”
CNBC ‘Freaking Out’ Over Decline in Ratings
“Squawk Box is down 16 percent in total viewers and 29 percent in the important 25-54 demographic bracket that advertisers buy. On Tuesday, the show drew its lowest numbers of the year in total viewers — 99,000.”
Another indicator that the battered retail investor has finally left the party…
EU Lawmaker Turns Screw on Ultra-Fast Trading
“Banks should be banned from giving outside brokers direct access to markets as part of a sweeping crackdown on computerised high-frequency trading, a European Parliament report said on Monday. The report was the assembly’s initial response to a draft law aimed at reining in computerised or algorithmic trading and other advances in technology which have made it harder for supervisors to see the full picture and control markets”
A Public Exit From Goldman Sachs Hits at a Wounded Wall Street
“Wall Street traders come and go all the time, but few have quit with the flair of Greg Smith. The way he resigned from Goldman Sachs, and what he had to say, could reignite a debate over how much Wall Street has changed in the wake of the financial crisis. “
Here’s the original NYT Op-Ed: Why I Am Leaving Goldman Sachs
MF Global: The Blame Game
“The Enron bankruptcy was not the result of a failed energy industry; it was the result of a criminal conspiracy. The Madoff bankruptcy was not the result of a failed hedge fund industry; it was the result of a criminal conspiracy. The MF Global bankruptcy is not the result of a failed futures industry; it is the result of criminal activity on the part of senior staff at MF Global…”
High-Frequency Traders Target Bank of America
“Bank of America is the stock of the moment for high-frequency trading, the supercomputer-driven buying and selling that barely existed a few years ago and now accounts for as much as two-thirds of U.S. trading. The bank’s single-digit stock price and flood of shares on the market — three times as many as its nearest big-bank competitor — make it an attractive target for hedge funds and banks that employ high-powered, computerized trading…”
(click title for article)
CME Group Moves To Stem MF Global Fallout
“A new $100 million guarantee fund for “farmers and ranchers” is seen in place by March 1, and will provide up to $25,000 per account if customers suffer losses from the insolvency of a CME clearinghouse member or other market participant. ““CME Group Inc. (CME) on Thursday unveiled fresh efforts to rebuild confidence after the collapse of MF Global Holdings (MFGLQ), boosting its dividend and creating a new fund to protect farmers and ranchers that use its futures markets. “
A fund that only covers “farmers and ranchers” for up to $25K in losses? Seems like trying to put out a fire with an eye dropper…
(Click on title for link)
The Rise of Developeronomics
Forbes piece on the rise of software developers as an economic commodity, the new “precious metals” of our society:
“The one absolutely solid place to store your capital today — if you know how to do it – is in software developers’ wallets. If the world survives looming financial apocalypse dangers at all, this is the one investment that will weather the storms. It doesn’t matter whether you are an individual or a corporation, or what corner of the world you inhabit. You need to find a way to invest in software developers”
As a software developer, I fully support this view :-)
Corzine “Doesn’t Know”
I guess one can run a company that puts $1.2B of customer funds at risk without having the slightest idea of what’s going on.
Simply Amazing.