Weekend Reading

• Must read: Fast-on-the-draw trades need spot of marshalling (FT, h/t Joe)
• Roubini Op-Ed on Bernanke: The Great Preventer (NYT)
• Lennar signals fleeting buildling rally as buyers flee (Bloomberg)
• JP Morgan to raise banker salaries (FT)
• The man spreading false rumors about Harman and Textron takeovers (that fooled fast-money's Najarian) found dead in suicide (Bloomberg)
• Chinese steel executive beaten to death,  (FT)

JPM's Carl Carrie On Algorithmic Trading

"if you look at what's happened recently in the credit markets, it hasn't opened
our eyes to liquidity risk, but liquidity cost and liquidity risk is perhaps a different
animal. It's not just about price volatility. It's about volume volatility. It's about timing of
that volume volatility. It may be there today, and when you want to get out of your
position, it may not be there tomorrow. And how do you reflect that into your own
trading and into, not just your alpha generation, but on the risk side of the alpha
generation? Most risk models don't really take into consideration the kinds of anomalies
that we may see on a yearly basis."

Some Weekend Thoughts By John Mauldin

A piece by John Mauldin covers much of what we have been discussing regarding the macro picture over the past few months.

HFT And Goldman Sachs Boiling Point: NYT And Max Keiser

Great recap piece in the New York Times on whether or not Wall Street is picking the pockets of "non-club" investors (read - the guys who do not generate 80% returns with a Sharpe > 5.0 - can someone explain how risk/return works again). The consensus sure looks good for class action lawsuit lawyers.

The piece also recognizes the tremendous contribution that Zero Hedge's readership has had in this ongoing debate, once more highlighting the interactive nature of new media and how crowdsourcing is the new dominant paradigm for Media 2.0. 

Here is the link.

Additionally, should it be odd that Direct Edge, the company in the eye of the Flash hurricane with its ELP program, has the following reported ownership structure:

Yes. Direct Edge is an independent broker-dealer owned by a consortium that includes the International Securities Exchange (“ISE"), Knight Capital Group, Inc., Citadel Derivatives Group, The Goldman Sachs Group, and J.P. Morgan. Knight Capital Group was originally the sole owner of Direct Edge and the firm was spun off in the third quarter of 2007 when Citadel and Goldman made investments. With a 31.54% stake, the ISE is currently the largest shareholder of Direct Edge, followed by Knight, Citadel, and Goldman, each with 19.9%.

And here are the latest ruminations out of Max Keiser, who takes on a curious angle in his most recent Goldman Sachs attack

The New Model?

It seems 1-2's and Marla's post earlier could not have come at a more opportune time. In a presentation by Andrew Gluck of Advisor Products, the author touches on some starkly comparable points (and, usefully, those with acute ADHD may find this presentation a tad more palatable, hehe, just kidding Marla) in the context of the epic paradigm shift occurring in the media world. Zero Hedge explicitly agrees that while the course of new media is still very much uncharted, the inherent conflicts of interest at the nexus of mainstream media and its providers of funding (not to mention bloated leverage and CDS levels in the 20pts upfront even in these artificially tight times), will make the survival of legacy media products increasingly more impossible.

Unjustified Optimism In Theory And Practice

This one falls into the category of one picture is worth a thousand optimistic promises. Compliments of Out Of The Frying Pan.

Saluzzi Educates MSM On PT, Does Not Buy Books

Irene, I would love to get a copy of your book. Are you willing to exchange one Digital Dickweed coffee mug for a few hundred copies? I am sure you have them lying around, and it sounds about equitable.

Also, good thing of Irene to admit that any variant of forntrunning is illegal. We are with you!