NPR: Killer 11min Whiteboard Talk on HFT

One coffee break and you’re on your way to being up to speed on High-Frequency Trading, Flash Orders, Co-Location, etc.  Big hat tip to Reuters’ irreplaceable Matt Goldstein.

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High-frequency trading from Marketplace on Vimeo.

 

UPDATE: This story arc is going seriously mainstream  Here’s a bit from TIME’s next newstand issue.[1]

In a competitive market, it’s a little hard to say why the exchanges shouldn’t engage in all this. But there is one nagging concern: that equity markets now move so insanely fast that they could go off the rails spectacularly. "I can’t tell you what all this volume of trading will mean," says electronic-trading pioneer E.E. (Buzzy) Geduld, who sold his firm, Herzog Heine Geduld, to Merrill Lynch in 2000. "I can tell you there may be some unintended consequences and this all may blow up." …

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[1]: "Madoff’s Other Legacy", by Justin Fox, TIME, August 24, 2009 edition.

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1 Comment for this entry

  1. John M. says:
    August 14, 2009 at 4:51 AM

    Here’s a nice little thumb-nail sketch of how the IBs are looting society’s pensions, insurance, charitable endowments and, ultimately, tax revenues.

    “High Frequency Trading: Wall Street’s New Rent-Seeking Trick”, by Martin Hutchinson, Money Morning, August 14, 2009.

    The bottom line for us ordinary market participants is that insiders are using computers to game the system, extracting billions of dollars from the rest of the market. While it is illegal to trade on insider knowledge about company financials, these people are trading on insider knowledge about market order flow. That’s how Goldman Sachs and the other biggest houses make so much from trading. By doing so they are rent-seeking, not providing value to the market.

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