Guest Post: Manipulation?
Submitted by Tyler Durden on 07/07/2009 - 09:12Joe Saluzzi submits: We have talked extensively on our blog and in our white papers about the power of high frequency trading and program trading. We have noted that these trading strategies can move the market quickly during the trading day. We have always suspected that there have been certain major players that can dominate this space. Now comes the case of the stolen proprietary trading code from Goldman Sachs.
Rosenberg On The 40% Dead Cat Bounce
Submitted by Tyler Durden on 07/07/2009 - 08:45"We have had 6 points of multiple expansion. It has been a multiple expansion rally... We have priced in a 2012 recovery."
CNBC can't get enough of corny jokes about crystal balls. Zero Hedge can't get enough of David's delightful grasp on economics.
Daily Highlights: 7.7.09
Submitted by Tyler Durden on 07/07/2009 - 08:08- British manufacturing output dropped in May
- Home prices may fall in more than half of the largest U.S. cities through of 2011
- Justice Dept. to look at telecoms and abuse of their market power.
- Oil hovers above $64 after plunging over past week
- Plane insurers suffer worst month since 2001 on Air France and Yemeni crashes
- US Service economy contracts at slowest pace in nine months in ISM index.
The Citadel Trail Emerges, Goldman Injunction Likely To Follow Shortly
Submitted by Tyler Durden on 07/07/2009 - 02:00Just when one thought it is possible to have a big scandal erupt, in which Chicago is named and not have Ken Griffin involved, the Citadel trail emerges. Contrary to previous rumors that Getco may have been the unfortunate firm to land Bond, Serge Bond, Misha Malyshev's new outfit, Teza Technologies, emerges with a bang. Teza, run by Misha, whom Zero Hedge has discussed previously, former Head of High-Frequency Trading at Citadel, together with another former teammate and recent Princeton grad (resume recently pulled from the interwebs), Jace Kohlmeier, announced that it had suspended Sergey without pay after learning of the allegations
Sergio Posts Bond As Toxic Code Percolates In Cyberspace And Allows "Market Manipulation"
Submitted by Tyler Durden on 07/06/2009 - 18:52“The
bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways,” Facciponti said. “The copy in Germany is still out there, and we at this time do not know who else has access to it.”
The prosecutor added, “Once it is out there, anybody will be able to use this, and their market share will be adversely affected.”
The proprietary code lets the firm do “sophisticated,
high-speed and high-volume trades on various stock and commodities
markets,” prosecutors said in court papers. The trades generate “many
millions of dollars” each year.
Casa Di Serge
Submitted by Tyler Durden on 07/06/2009 - 18:06And now for some evening real estate porn combined with a slow motion career trainwreck. Not that it matters to the Serge(y) Aleynikov estate all that much anymore, but some preliminary digging by NJREReport has uncovered pretty much most loose ends in the case of the Russian 007 that was never meant to be. First: here is the tax property detail to the 38 year old's house. Not that exciting. What is more amusing is the dramatic price decline as Serge(y) was trying to offload his 4 bedroom colonial, which was first put on the market in August 2008 (oddly, the Chicago firm, which everyone has identified by now, still has not indicated just when it was that it first approach Serge... and under what guise did it agree to raise his base pay to $1.2 million). Either way, Serge(y) tried to sell first for $689,000, and after less than a year is now "PRICE TO SELL AND PRICE BELOW NEW ASSESSED VALUE" at $550,000: at least the man has a good sense of the true NJ real estate market: those math Ph.D. and SS7 certifications come in handy on occasion. (Alas that price does not cover the $750,000 bail set earlier for Mr. Aleynikov, maybe they can throw in the Honda as part of the package).
Sergey Aleynikov Guilty Of Prior IP Violation?
Submitted by Tyler Durden on 07/06/2009 - 16:20Zero Hedge is still trying to ascertain whether this Sergey Aleynikov is "that" Sergey Aleynikov, but if 1=2, then (to keep it algo) it would seem Goldman's HR department is rather lousy at doing background checks. (Also, was Sergey in pro per? Hopefully he has learned how to retain counsel by now.)
New York Stock Exchange: "We Screwed Up"
Submitted by Tyler Durden on 07/06/2009 - 16:18The story of Goldman's missing PT data has now entered the twilight zone.
Matt
Goldstein at Reuters reports that Goldman spokesman Michael Duvally notified
him that Goldman did in fact not only perform its usual NYSE SLP domination, but also reported of this, as it does every week:
“According to the data Goldman Sachs submitted, we are certain we
were among the
top firms in terms of program trading volume for the week ending June 26.”
It Is Time For The SEC/NYSE To Respond To The NASDAQ's SLP Clarification Requests
Submitted by Tyler Durden on 07/06/2009 - 16:10Now that Goldman and the NYSE's Supplemental Liquidity Provider program have finally attracted a critical mass of necessary (and hopefully sufficient) public attention, Zero Hedge would like to readdress an overlooked complaint in which none other than the NASDAQ Stock Market LLC vociferously blasts the NYSE, the SLP program, and some of the underlying assumptions. Zero Hedge has discussed this issue extensively in the past, yet neither the SEC nor the NYSE (essentially, FINRA) seem to have ever addressed any of the NASDAQ's concerns. Zero Hedge believes the time has come for the later two regulatory organizations to provide some feedback to NASDAQ's concerns.
Guest Post: The Week Ahead For Equities Is Fraught With Downside Risk
Submitted by Tyler Durden on 07/06/2009 - 16:05Some insight from Structural Logic's John Bougearel.
Commodities and equities telling two different stories
Submitted by Cornelius on 07/06/2009 - 15:30Oil is going down, equities are going up - which is it?
Zero Speed
Submitted by Marla Singer on 07/06/2009 - 14:31As you no doubt have noticed, Zero Hedge has enjoyed taunting you by swimming through the ether like it was molasses. We are putting the final touches on things like load-balancing and network settings, so occasionally, as you bring us to new heights of traffic saturation, we've been tweaking things to max out our capacity. (Or exceed it and cause database violence).
Guest Post: The Week Ahead For Equities Is Fraught With Downside Risk
Submitted by Tyler Durden on 07/06/2009 - 03:49The week following NFP weeks are generally light on economic data. Typically these economic-light weeks garner a lot of speeches from Fed officials and the like. But while Fed Presidents Evans and Duke, as well as Geithner will speak or testify, remarks from them should not be market moving events. So, you might think that a quiet week would correspond with a low volatility. That is sensible enough, but you might be wrong. Investor confidence has been shaken by the July 2 NFP report that showed job losses in June were not just much worse than expected, but also much worse than the previous month. The July 2nd jobs report effectively discredited the “green shooters” thesis that thing were getting less bad. In other words, things are suddenly less bullish or more bearish. Oops!
Is CNBC Filtering Any Reference To Zero Hedge?
Submitted by Marla Singer on 07/05/2009 - 23:24Update: Short answer- probably not.
From our tips line:
I am sure you have probably seen this before, but I found some interesting differences in the article by Matthew Goldstein as posted at http://blogs.reuters.com/commentaries/2009/07/05/a-goldman-trading-scandal/ and the article as posted on cnbc, http://www.cnbc.com/id/31750907.
Returns on major FX players are showing choppiness in FX
Submitted by Cornelius on 07/05/2009 - 21:21The returns of some big FX players are serving as an impromptu summary for the past 6 months.
