If You Regulate Us, We Won’t Provide Liquidity!

March 3rd, 2011

Providing Liquidity: The evolution of the SOES bandits in the 1990’s into DATEK, ISLD, NSDQ, and finally Big HFT firms who run ahead of your orders. You bid $21.04, six of them bid $21.05 and take stock up to $21.18. This automated sludge is now somehow Providing Liquidity, because it has been repeated often enough. They didn’t provide you liquidity; they screwed you and provided you heartburn. And as we all knew they would they are actually meeting with regulators and claiming that if anyone attempts to stop them, they won’t provide their liquidity anymore. Read the article here:

If You Regulate Us We Won’t Provide Liquidity Wahhhh

Emphasis mine.

From: The Mind-Numbing Euphemism: Providing Liquidity, by Sal Arnuk | The Big Picture.

  1. March 6th, 2011 at 05:38 | #1

    This is one of your better posts Steve. Outstanding. Great stuff. I want to know where the hell these HFT guys were when I bid on a Nasdaq stock, the price fell where I wanted it twice and the trade never went through.

    This issue always makes my blood boil. My blood pressure must shoot up 50 points in about 30 seconds when I think of this topic. And what gets me going even more is when bums like Rajiv Sethi of Santa Fe Institute defend HFT. Maybe like so many corrupt professors before him, he thinks he can get a sponsored Professorship or “Chair” from one of the investment banks if he markets the HFT cowshit as “market liquidity” for them???

    I’m very ashamed to say I used to read Rajiv Sethi regularly until he took the HFT practitioners side on this one, after that I never so much as glanced at his blog again. he knows better but he thinks he can get academic status by doing these bastards bidding for them. I hope he sleeps well at night now that he has sold his academic soul so cheaply.

  2. March 6th, 2011 at 05:53 | #2

    I finally got David Einhorn’s book Steve ($8.80 brand-new Wooohooo!!!!). As sharp as you are and prolific reader that you are (typical Jew) I’m assuming you read it already. I would love to see you post not only on Einhorn’s book but on the general topic of Corporate Governance and shareholder rights. You could address both topics with one post. Would love to read your thoughts on both. Take care.

  3. March 6th, 2011 at 07:43 | #3

    Hey Ted, thanks for the pointers to Sethi and Einhorn. Through Sethi I also found Ashwin Parameswaran. Much to digest there.

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