Computer trading - When Indians fear...do not tread

Below is a Bloomberg article on the danger of HFT and computer trading and how this new animal is frightening the Indians and their calls for actions to curb the beast. The only shortcoming is that there is this denial to call a crime a crime. But anyone in the business could figure out from the comments of the article how criminal are HFT and computer trading, how they cheated the innocent investors and how they are ruining the stock market from their gambling tactics instead of trading on stock fundamentals. As a result the stock market is in ruins and tatters. It is unbelieveable and criminal for stock market operators to continue with this destructive crime against the investors and the imminent destruction of the stock market industry. Here is the gist of the article with some of the irrelevant being deleted to shorten the piece.

Hottest Emerging Market for Algo Trades Wants to Cool Down (1)
2016-03-28

By Santanu Chakraborty
     (Bloomberg) -- India’s flash boys are discovering that even the biggest emerging market for computerized trades has its limits.

In just five years, high-speed and algorithmic traders have gone from bit players to a dominant force on Indian exchanges, enabled by a technological arms race between the nation’s top exchanges that cut transaction times to tiny fractions of a second. Now, as some of the country’s largest brokerages call for tighter regulation, those same bourses are starting to explore whether speed traders should be reined in.
    
National Stock Exchange of India Ltd. is considering higher fees for traders who flood the market with unfilled orders, while its cross-town rival, the BSE Ltd., has called for “corrective action” to address the harmful side effects of high-speed strategies. Critics of India’s supercharged market structure say it’s raising costs for long-term investors, introducing little-understood risks and distracting exchanges from what should be a priority: getting more of India’s 1.25 billion people to put their savings to work in the country’s capital markets.
    
 “It seems that man is losing out against the machine,” said Jitendra Panda, a governing board member of the Brokers Forum, an association of 800 broker-dealers in India...

Both bourses have introduced co-location services -- allowing traders to put their computers in exchange data centers so they can execute faster -- and offered monetary incentives for derivatives transactions. India’s fragmented markets, where many of the same securities trade on multiple venues, also makes it attractive to high-frequency traders looking to arbitrage price differences. In October, the BSE reduced its average processing time for trades to 6 microseconds from 300 milliseconds, the fastest worldwide, according to Ashishkumar Chauhan, BSE’s chief executive officer.
    
While Chauhan says India has been among the world leaders in setting regulatory standards for high-speed trading, he sees scope for creating a more level playing field.
     
“We are doing a lot of HFT compared to the size of market and we need a clear understanding of the risk,” Chauhan said in an interview. “We need to take corrective action so that the good part of HFT is maintained and the harm that can come can be reduced to the maximum extent possible.”....

Exchange officials are quick to point out that their goal is to accommodate all types of investors and that computerized trading has brought important benefits to Indian markets, including smaller spreads and higher trading volumes.
    
But detractors claim that those measures don’t tell the whole story. They say some high-frequency traders are profiting unfairly at the expense of long-term investors by spotting their orders, then pushing up prices before the slower trader has time to react.
    
“Investors are being forced to pay more to buy or sell stocks due to HFT and algo systems,” said Panda....
    
    
The NSE is “continuously addressing concerns about different HFT models and their potential to distort markets,” Narasimhan said.
    
The Securities and Exchange Board of India, which issued broad guidelines on computerized trading in 2012 and 2013, said in December it’s considering new restrictions, but has so far taken no action....

For Deven Choksey, managing director of Mumbai-based K.R. Choksey Shares & Securities Ltd., India’s stock market would be better served if exchanges focused on attracting more of the nation’s growing pile of household savings instead of luring ever-faster traders and the higher fee income they bring. The base of individual investors has shrunk from about 30 million in 1991 to less than 25 million today, BSE’s Chauhan said.
    
“Exchanges won’t be able to help channelize household savings into the capital markets if their focus is only profit maximization,” Choksey said. “We will invite trouble if there’s no structural solution.”

Green house politicians can learn from Malaysian politics

There are no permanent friends or enemies in politics. The friends and foes in Malaysian politics are regrouping under Mahathir, the man that had charged them and put them in jail, for a common mission, to unseat Najib. Anwar and Lim Kit Siang, the arch enemies of Mahathir are now smoking peace pipes and drinking together and planning what to do to bring down Najib. They are all politician extraordinaire, knowing what is the common goal and to put down differences or personal grudges when there is a common enemy to strike.


In the Singapore context, the opposition camp did not have such bad blood to talk about.   Oops, I stand corrected on this. There were differences and often differences created by third parties to divide them up.  The differences among the opposition parties and leaders are nothing more than I don’t like your look and you don’t like mine. As far as political agenda and differences are concern they are very minor.


Why then is it so difficult for the opposition parties here to put their differences aside and sit down together, like the Malaysian politicians, to chart a common course, a common objective to take on the PAP?  They are not arch enemies, are they? What is the stumbling block that makes the divide so difficult to bridge? Could they see further down the road, to join forces, to work together and bring down a common enemy first, other things can wait?


There have been many calls, friendly gestures, olive branch being extended, to bring the opposition parties together but in vain. They don’t even want to talk to each other or be seen together.


This brand of politics can only happen in this island. The opposition parties know they have very little chance of unseating the ruling party, maybe if luck is good, get a few seats into Parliament, and if not, get completely wiped out from Parliament.  And they are contented with that.  On the other hand, coming together, to present a united front, combining their talents and resources, they would look more real, credible and serious as an alternative to the ruling party and to stand a better chance of being elected, and a better possibility of forming a coalition govt.  Why not?  The answer is our sanitized greenhouse political climate. Better be safe and be on the right side than be sorry.

It is such a bewilderment to see them struggling as splintered groups hoping to win a seat or two in a GE when they could gain a bigger pie.

Be real politicians, not greenhouse politicians, need to be politically correct, cannot be seen with politicians that are deemed no good by the ruling party and thus tarnishes their reputations in the eyes of the ruling govt. Is this the reason, that opposition parties are watching their steps carefully, to be seen as reasonable and good guys by the ruling parties, so stay away from other opposition parties that have been branded as bad boys?

May I suggest they look at the Malaysian politics carefully, study them and pick up some of the good points to help them make a bigger impact in the next GE. There are no permanent friends or permanent enemies in politics. A coalition of convenient is just as good as anything if it can bring results. If PAS can sit together with DAP, If Mahathir can sit together with Kit Siang and Anwar, what else cannot be done?

It is politics, stupid. You don't need the blessing of the ruling party to be acceptable and to win an election.

Budget 2016 – Govt can afford to be more generous

How much is the govt’s handout in this year’s budget? You think it is enough or can the govt afford to be more generous? Don’t panic, no one should be thinking of robbing the reserves. Keep the lid tight on the reserves. Tony Tan will be there to guard against touching the reserves. There will be more tons to weigh down and to look after the reserves if Tan Cheng Bock becomes the next President.

 

The govt has a lot of money from the last CPF Life and Medishield Life Schemes to throw back to the people. Just look at how much the govt is raking in from the people with a stroke of the pen from the Medishield Life Scheme. If each adult is to pay $500 a year for Medishield Life, and if there are 2m adults in the CPF, that is $1b of premium annually, every year going back to the govt. This one no pay back except for those who needed to claim for medical bills less co payments.

 

And don’t forget the $200k plus locked up in the two minimum sum schemes that would delay payback time by another 20 years. This means twenty years of free money to use, like the Americans enjoying free money selling the dollar as an international reserve currency, with no payback time. This $200k per head is like no payback time as another member will join the scheme for anyone leaving the scheme. The 20 year lockup time is the minimum as many would live to 80 or 90 and the money would still be out of their reach, till death do they part.

 

The $200k plus per CPF holder of 2m CPF members works out to be more than $400b free money to use for the next 20 years or more. Can the govt be more generous in throwing back a fraction of the money that rightly belonged to the people for the rightful owners to use?

 

What would a hundred million or a few hundred millions be to the govt when Medishield Life is taking $1b annually and the hundreds of billions locked up in the minimum sum schemes? The handouts thrown back at the people are directly/indirectly  the people’s money?

 

Leong Sze Hian may want to work out this relationship between money kept or paid to the govt by the CPF members and the money used as handouts to be given to the people. Then the people can decide if the govt is generous and if they should say a big thank you to the govt or to themselves.

Donald Trump will be dumped by the American cabal

Donald Trump
Interesting take on Donald Trump and today's political system. Former U.S. Secretary of Education, William J. Bennett's frankly candid and shocking observations of Donald Trump's impact on the behavior of the entrenched Washington D.C. bureaucrats in both parties -- and the risk The Donald faces in so doing.
William J. Bennett, Host of Bill Bennett's Morning in America Show, is one of America's most important, influential, and respected voices on cultural, political, and education issues. He has one of the strongest Christian world views of any writer in modern times.
 What I See Happening In a Trump Presidency
by Bill Bennett
They will kill him before they let him be  president. It could be a Republican or a Democrat that instigates  the shutting up of Trump.
Don't be surprised if Trump has an accident.  Some people are getting very nervous: Barack Obama, Valerie Jarrett, Eric Holder, Hillary Clinton and Jon Corzine, to name just a few.
It's about the unholy dynamics between big government, big business, and big media. They all benefit by the  billions of dollars from this partnership, and it's in all of their  interests to protect one another. It's one for all and all for one.
It's a heck of a filthy relationship that makes everyone filthy rich, everyone except the American people. We get ripped off. We're the patsies. But for once, the powerful socialist cabal and the corrupt crony capitalists are scared. The over-the-top reaction to Trump by politicians of both parties, the media, and the biggest corporations of America has been so swift and insanely angry that it suggests they are all threatened and  frightened.
Donald Trump can self-fund. No matter how much they say to the contrary, the media, business, and political elite understand that Trump is no joke. He could actually win and upset their nice cozy apple cart. It's no coincidence that everyone has gotten together to destroy The Donald. It's because most of the other politicians are part of the good old boys club.  They talk big, but they won't change a thing. They are all beholden to big-money donors. They are all owned by lobbyists, unions, lawyers, gigantic environmental organizations, and multinational corporations - like Big Pharmacy or Big Oil. Or they are owned lock, stock, and barrel by foreigners like George Soros owns Obama or foreign governments own Hillary and their Clinton Foundation donations.
These run-of-the-mill establishment politicians are all puppets owned by big money. But there's one man who isn't beholden to anyone There's one man who doesn't need foreigners, or foreign governments, or George Soros, or the United Auto Workers, or the teacher's union, or the Service Employees International Union, or the Bar Association to fund his campaign.
Billionaire tycoon and maverick Donald Trump doesn't need anyone's help. That means he doesn't care what the  media says. He doesn't care what the corporate elites think. That makes him very dangerous to the entrenched interests. That makes Trump a huge threat to those people. Trump can ruin everything for the bribed politicians and their spoiled slave masters....
Once Trump gets in and gets a look at the cooked books and Obama's records, the game is over. The jig is up. The goose is cooked. Holder could wind up in prison. Jarrett  could wind up in prison. Obama bundler Corzine could wind up in prison for losing $1.5 billion of customer money. Clinton could wind up in jail for deleting 32,000 emails or for accepting bribes from foreign governments while Secretary of State, or for misplacing $6 billion as the head of the State Department, or for lying about  Benghazi. The entire upper level management of the IRS could wind up in prison.
Obamacare will be de-funded and dismantled. Obama himself could wind up ruined, his legacy in tatters. Trump  will investigate. Trump will prosecute. Trump will go after everyone involved. That's why the dogs of hell have been unleashed on Donald  Trump.
Yes, it's become open season on Donald Trump. The left and the right are determined to attack his policies, harm his businesses, and, if possible, even keep him out of the coming debates. But they can't silence him. And they sure can't intimidate him. The more they try, the more the public will realize that he's the one telling the truth.

LKY – too much of a good thing

The big celebration in the remembrance of LKY on his first anniversary is starting to raise eyebrows and turning a bit sour. It is opportune that Lee Wei Ling spoke up against it and warning those over zealous supporters and believers not to go overboard. Many great leaders in the past have been revered by their people through history. Many have made their marks decades ago, some hundreds or thousands of years ago and still fondly remembered by the generations of people coming to know them.

The celebration of LKY was compared to the celebration for Mao Zedong and Winston Churchill and to some, more like Kim Sung Il. In China and North Korea, huge monuments and statues of the two leaders were built to honour them. Some in China wanted to elevate Mao to the status of a deity, 神, and probably with temples built for him for people to worship him. This was rejected by the Chinese govt and similarly I don’t think there were temples to deify Kim Sung Il.

Without someone from the family to speak out against this irrational exuberance, it can be expected that the political opportunists could carry things a bit too far in revering and remembering LKY and turn it into a personality cult that Wei Ling rightly pointed out. And when that happens, a good thing could turn into a bad thing for the stupidity of it.

Too much of a good thing can easily turn bad. This is the 21^st Century and Singaporeans, especially the highly educated, would find it a bit uncomfortable to stomach such overt expression of reverence.  This is different from religious outpouring of love within the confines of a religious abode. Some may find it revulsive though they may not utter a word or show any sign of their true feelings.  It is better to keep things in a proper and respectable perspective before it goes out of hand.

Wei Ling’s comment is timely and effective. Coming from anyone else outside the family may draw a mix bag of reactions.  LKY shall be remembered by Singaporeans for generations to come and by the foreigners who came and gone home rich for his blessings on them. Let history and the millennial remember him in a way appropriate to them.  Do not create controversies and a sour note so early after he left the scene. The first time was a nation in grief. This time it does not seem to be going the same way.

It will be perfectly alright to do such a thing in countries like North Korea, but in Singapore today, I think it is better to be more circumspect. Wei Ling has spoken but she is the only voice from the family. Is she representative of her siblings or they have different ideas?

Please feel free to disagree with me. Those who would like to set up altars in their homes, please do so as you like.

PS. For those who benefitted greatly from LKY's policies, may I suggest a better way is to donate a bit of their good fortune to help the poor in his name. Would that not be better?