By Lindsay Fortado and Dave Michaels
June 4 (Bloomberg) -- Britain’s market regulator is
scrutinizing high-frequency trading algorithms to ensure firms
can suspend operations at short notice and aren’t abusing the
market, its chief executive officer said.
The Financial Conduct Authority is monitoring firms across
the industry to understand “the risks associated with the
development of algorithms for use in high-frequency trading,”
Martin Wheatley said at a conference in New York today….
Mary Jo White, chairman of the U.S. Securities and Exchange
Commission, told lawmakers on April 1 that the agency is
conducting “a number” of enforcement investigations that focus
on high-frequency trading and automated trading strategies. The
regulator has also said it’s conducting a broad review of equity
market structure and may make changes to the way investors trade
stocks.
European Union lawmakers approved legislation in April that
will create some of the toughest rules in the world for high-
frequency traders. The limits include standards meant to keep
the price increment for securities from being too small,
mandatory tests of trading algorithms, and requirements that
market makers provide liquidity for a set number of hours daily….
“Essentially what we have now in the U.K. is a mix of
exchange-led monitoring, with the regulator analyzing risks such
as cross-market techniques on the one hand,” Wheatley said.
“On the other, industry itself reporting suspicious activity,
so the challenge here becomes a shared one.”
My Comments: The American and European regulators are putting on a show
but not doing much. The important thing to know is that the regulators
knew that HFT is unfair trading and violating the rules and regulations
of the exchanges, but they still allowed HFT to operate.
This is as good as knowing a crime but closing an eye to let the crime
to be committed. They are both condoning a criminal act and should be
prosecuted for allowing it to go on.
Kopi Level - Green
I have just finined reading "Flash Boys" by Michael Lewis.
ReplyDeleteIt is clear that more regulation actually ENABLES the HF traders. After creating certain regulations, the geeks find loopholes and exploit them. Then there is new regulation to plug the holes in the old regulation, creating more exploitable holes.
Speed is the Holy Grail of present trading operations. You cannot buck this trend. If you do, your traders will fuck off somewhere else to do business, and your bourse will go bankrupt from lack of business.
There is a principle related to spontaneous orders and chaotic systems -- it is next to IMPOSSIBLE to buck a trend.
The days of traders screaming orders on the floor are long gone. Program trading, introduced in the 1980's is now on a course for greater and greater speeds. Since the financial space is now increasingly dominated by math and physics geeks, rest assured they will bring all the latest science to bear.
A hot category for physics is now neutrino research. These are small particles which travel through EVERYTHING, unlike light. Because they are so small and light, they travel very close to the speed of light. Light cannot travel thru the earth, but neutrinos can, so if they figure out a way for neutrino waves to carry information then that would be another game changer.
So the EU idiots who don't understand shit are welcome to bring in as many rules as they like. By doing so, they create loopholes or will drive business from Europe. BTW, Russian programmers are the "hot stuff" now in the HFT hardware and software spaces.
Algorithms and robots are increasing in use in every aspect of life. No one can buck this trend.
As always: follow the money
'Speed is the Holy Grail of present trading operations. You cannot buck this trend. If you do, your traders will fuck off somewhere else to do business, and your bourse will go bankrupt from lack of business.' Matilah Singapura.
ReplyDeleteDon't bullshit. This is the same silly reasoning that if we don't pay the super talents well they will quit. If we don't bring in the foreign talents they will go elsewhere.
Where is this elsewhere? If all the bourses and regulators are responsible and don't allow HFT, where can HFT go? The Americans are allowing this crime to continue because the lawmakers are beholden to them and became accomplices to this crime.
When the Americans are allowing such criminal activities to go on, it does not mean that others should also follow them.
The Americans are screwing the whole financial system and it is only a matter of time before everything goes kaput.
PS. Be careful with your camel's feet. The Arabs got Mers because they fraternalised with the camels.
But a tiny red dot wants in...
ReplyDeleteIt is scary how many could have left penniless, yet all their money or asset is in CPF, something wrong?
ReplyDeleteIt is wiser to give back even you feel that there might be some of them live past 70s/
What for set up the CPF as promised to return to people and people can't use it on emergency, or as promised, when they reach 65 or 70 people are not sure where the money gone, every year delay in getting their money increase their risk considerably?
In today context of high inflation, many foreign immigrant and workers, many could use up their savings in 50s soon if they out of job and had families to take care?
Unlike yester year where one can withdraw their money at 55 as promised, where foreign worker competition is low, today especially one reach older, less marketable?
What for if you need the money urgently and you can't take it out, many likely not live until 65 and 70?
The younger generation would face more difficulties because of the heavy competition from cheaper foreign countries for jobs, as they grow older the more they need the CPF savings to tide over some difficult period not to resort to credit companies and AH Long?
What is the use of living on promise on assumption, when you reach 65 or 70 it could change again?
ReplyDeletePeople rather to have their money back at 55, then continue to live on promises and assumptions? What if assumptions and promised don't come true?
At least if you get it back on 55 you had the chance of spent some of it to tide over difficult periods in today context?
The next election this issues could cause the votes dearly?
People can't live on assumption and promise along, people need it to be back action as promised as one reach 55 to be returned?
ReplyDeletePeople are not children, they are not interest to listen to flimsy excuses they are old enough to take care of their own money,whenever excuses given they can't take care their money?
The next election result could reflect dearly, if people can't get a major part of their CPF as promised at 55?
They are likely hoping that the opposition could help them?