Jenksismyhero Posted April 17, 2013 Share Posted April 17, 2013 Just remember though, only Republicans protect the wealthy. Link to comment Share on other sites More sharing options...
southsider2k5 Posted April 17, 2013 Share Posted April 17, 2013 Done on a voice vote. Well done, bastards. Link to comment Share on other sites More sharing options...
StrangeSox Posted April 24, 2013 Share Posted April 24, 2013 Long-Term Unemployment Is The Biggest Crisis In America — This Photo Shows How Much Politicians Care 1 legislator bothered to show up for the hearing. Link to comment Share on other sites More sharing options...
mr_genius Posted April 24, 2013 Share Posted April 24, 2013 QUOTE (Jake @ Apr 17, 2013 -> 08:19 AM) The long-term unemployed are unemployable, research finds Simply replace them with guest workers in the labor market. That's Obama's solution. You agree with Obama, don't you? Link to comment Share on other sites More sharing options...
mr_genius Posted April 24, 2013 Share Posted April 24, 2013 QUOTE (StrangeSox @ Apr 24, 2013 -> 11:17 AM) Long-Term Unemployment Is The Biggest Crisis In America — This Photo Shows How Much Politicians Care 1 legislator bothered to show up for the hearing. The hearing on increasing guest workers was jam packed. Why hire the unemployed when you can get cheap guest workers? Obamanomics. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 How high-speed traders are exploiting loopholes on the Chicago Mercantile Exchange http://online.wsj.com/article/SB1000142412..._LEFTTopStories Firms can use their early looks at CME trading data in several ways. One strategy is to post buy and sell orders a few pennies from where the market is trading and wait until one of the orders is executed. If crude oil is selling for $90 on the CME, a firm might post an order to sell one contract for $90.03 and a buy order for $89.97. If the sell order suddenly hits, the firm's computers detect that oil prices have swung higher. Those computers can instantly buy more of the same contract before other traders are even aware of the first move. Not sure how this is supposed to benefit anyone but those wealthy enough to buy this sort of access in the first place. Link to comment Share on other sites More sharing options...
iamshack Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 08:35 AM) How high-speed traders are exploiting loopholes on the Chicago Mercantile Exchange http://online.wsj.com/article/SB1000142412..._LEFTTopStories Not sure how this is supposed to benefit anyone but those wealthy enough to buy this sort of access in the first place. One of my exes was telling me a few years ago that this is where the market was heading...that ultimately, whoever had the best algorithms could get the buy and sell orders in seconds ahead of real traders. In looking at some of the hiring in that area recently, they have been looking for folks who could design those very algorithms. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 I've posted this animated history of market trading volume before, but seems relevant: That change is just over a five year period. http://blogs.reuters.com/felix-salmon/2012...ay-hft-edition/ Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 From what I understand from CNBC, the Merc has allowed co-location of servers at the CME server facility, which cuts out about a 10 milsec commute time for an order for orders from servers that aren't co-located. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 Honest question, how does this help anyone but the traders who can get that access, how is that not pure rent-seeking with no wider benefits? Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 01:00 PM) Honest question, how does this help anyone but the traders who can get that access, how is that not pure rent-seeking with no wider benefits? It doesn't. Honestly I am not quite sure how the SEC has allowed this to go on. I also don't know if this is something exclusive to the Merc, or if this is done industry wide. I do know most US stock exchange servers are located on the East Coast to speed up inter-Exchange orders and meet NBBO obligations. I am not sure if the exchanges have allowed co-location though. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (southsider2k5 @ May 1, 2013 -> 01:04 PM) It doesn't. Honestly I am not quite sure how the SEC has allowed this to go on. I also don't know if this is something exclusive to the Merc, or if this is done industry wide. I do know most US stock exchange servers are located on the East Coast to speed up inter-Exchange orders and meet NBBO obligations. I am not sure if the exchanges have allowed co-location though. The NYSE has for sure. Goldman had exclusive access for a while giving them a 10ms advantage, but others got access several years ago. Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 01:12 PM) The NYSE has for sure. Goldman had exclusive access for a while giving them a 10ms advantage, but others got access several years ago. So does any Goldman customer get that advantage? Remember, GS has a massive customer base. As long as they are giving that advantage to their customers as well as their prop firm, they aren't doing anything wrong. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (southsider2k5 @ May 1, 2013 -> 01:32 PM) So does any Goldman customer get that advantage? No idea. Remember, GS has a massive customer base. As long as they are giving that advantage to their customers as well as their prop firm, they aren't doing anything wrong. Disagree strongly. Rent-seeking is still rent-seeking, even if its going to the limited customer pool of GS and not a handful of traders. Those rents are still being extracted from somewhere, someone else is paying them (it's anyone who trades without access to the HFT). Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 01:38 PM) No idea. Disagree strongly. Rent-seeking is still rent-seeking, even if its going to the limited customer pool of GS and not a handful of traders. Those rents are still being extracted from somewhere, someone else is paying them (it's anyone who trades without access to the HFT). If it is being offered to everyone (you yourself said it wasn't just Goldman) then it really isn't an advantage. Where you locate your servers actually is a part of business decision making. Distance effects time of execution. A company can make a business decision to put their server in Chicago because it is cheaper. The problem is then they aren't near the hub, and they are costing their customers mils in execution times. As long as the offer of co-location isn't being offered exclusively to certain people or customers, then it really is a non-issue. If firms are too cheap to take advantage of it, that is their problem. That actually makes sense why the SEC has never done anything about this. This is getting sold as OH NO THE HFTs, but as long as they aren't the exclusive beneficiaries of it, that isn't really an accurate story. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 For this to be profitable (and it is, massively), somebody is losing out. I don't know how much this actually applies to any customer-driven trades. My understanding is that it's entirely algorithms, which is why we such things as the still-unexplained flash crash or the "white house bombing" crash the other week. Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 01:58 PM) For this to be profitable (and it is, massively), somebody is losing out. I don't know how much this actually applies to any customer-driven trades. My understanding is that it's entirely algorithms, which is why we such things as the still-unexplained flash crash or the "white house bombing" crash the other week. Which anyone can do. Link to comment Share on other sites More sharing options...
iamshack Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 11:58 AM) For this to be profitable (and it is, massively), somebody is losing out. I don't know how much this actually applies to any customer-driven trades. My understanding is that it's entirely algorithms, which is why we such things as the still-unexplained flash crash or the "white house bombing" crash the other week. Well, the folks that are losing out are the trading firms that still try to utilize the old school methods. I don't know that either one is necessarily right or wrong...I just know things have changed dramatically in that industry. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (southsider2k5 @ May 1, 2013 -> 02:12 PM) Which anyone can do. Most people can't get server space in the NYSE. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (iamshack @ May 1, 2013 -> 02:38 PM) Well, the folks that are losing out are the trading firms that still try to utilize the old school methods. I don't know that either one is necessarily right or wrong...I just know things have changed dramatically in that industry. Wouldn't this amount to everybody engaged in traditional investing, e.g. our 401k's and IRA's? Maybe I don't understand it fully, but my understanding is that HFT is not a part of your traditional "investing" trading, it's something that investment banks do solely for their own profits. Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 03:46 PM) Most people can't get server space in the NYSE. No person can. Only trading firms can. As long as any trading firm can, it is perfectly legal because equal opportunity is there. Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 03:48 PM) Wouldn't this amount to everybody engaged in traditional investing, e.g. our 401k's and IRA's? Maybe I don't understand it fully, but my understanding is that HFT is not a part of your traditional "investing" trading, it's something that investment banks do solely for their own profits. More prop shops than investment banks. For investment banks it is a piece of the puzzle. Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (southsider2k5 @ May 1, 2013 -> 04:37 PM) No person can. Only trading firms can. As long as any trading firm can, it is perfectly legal because equal opportunity is there. Ok, I've not asked if it's legal or not. Plenty of shady things are legal and I assumed this was as well. I was asking if there's any greater benefit to it, or if it's just rent-seeking and maybe should be made illegal (or a tiny transaction tax applied, making it unprofitable to make so many trades for fractions of pennies). Link to comment Share on other sites More sharing options...
StrangeSox Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (southsider2k5 @ May 1, 2013 -> 04:38 PM) More prop shops than investment banks. For investment banks it is a piece of the puzzle. Either way, it seems like it's a negative for most people, including your typical retirement-type or "buy and hold" investors, and good only for people who can buy access. Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 1, 2013 Share Posted May 1, 2013 QUOTE (StrangeSox @ May 1, 2013 -> 04:40 PM) Ok, I've not asked if it's legal or not. Plenty of shady things are legal and I assumed this was as well. I was asking if there's any greater benefit to it, or if it's just rent-seeking and maybe should be made illegal (or a tiny transaction tax applied, making it unprofitable to make so many trades for fractions of pennies). I don't think you understand real HFT. It isn't about the number of trades as much as the number of quotes issued. Link to comment Share on other sites More sharing options...
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