"It's Not A Market, It's An HFT 'Crop Circle' Crime Scene" - Further Evidence Of Quote Stuffing Manipulation By HFT
Recently we posted a required reading analysis by Nanex in which the market trading analytics firm presented irrefutable evidence of quote stuffing by HFT algorithms in tens of stocks, in which thousands of cancelled quotes would reappear each second with a definitive periodicity and regularity, around the time of the May 6 flash crash. Aside from the fact that it is illegal to indicate a quote without a trade intent, this form of quote stuffing is in fact manipulative when conducted by HFT repeaters in specific "shapes" as it actually moves the NBBO actively higher or lower, in cases pushing the bid/offer range up to 10% higher without even one trade ever having occurred, simply by masking a big block order which other algos interpret as bid interest and pull all offers progressively or step function higher (or vice versa, although we have rarely if ever seen the walking down of a stock over the past 18 months). It is as if the HFT lobby has been given the green light by the powers that be that it is safe to activate merely the bid-size quote stuffing algorithms, and not worry: the fact that the market is so one sided in its quote stuffing patterns is sufficient reason to worry of a concerted effort to push stocks higher, initiated from the very top, and effected by not only the Primary Dealer community but by the end-market "liquidity providers." Today, courtesy of Nanex we demonstrate that this type of illegal stock manipulation continues rampant to this very day, and the SEC still fails to acknowledge that it is precisely the HFT market participants that persist in destabilizing stock prices, which have given up responding to fundamentals and merely move up or down based on quote stuffing interventions by those who plead innocence and claim to only be providing liquidity. Well take a look at the millions in fake, and thus illegal, bids demonstrated below and tell us just how any of this manipulation is "providing liquidity" - the second the patterns break, the algos responsible for the churn pattern disappear, thus eliminating numerous levels of so called bid liquidity below the NBBO: break enough patterns and you have another flash crash as the market once again goes bidless.
So while the SEC continues to pander merely to the interests of the market manipulation lobby, and is now doing it in more style than ever by refusing to answer to FOIA requests going forward, here is Nanex with yet more evidence that we no longer have a market, but merely a daily recurring crime scene.
In our original Flash Crash Analysis report, we dedicated a section to an observed phenomena we termed "Quote Stuffing", in which bursts of quotes (at very high rates) with extremely unusual characteristics were observed.
As we continue to monitor the markets for evidence of Quote Stuffing and Strange Sequences (Crop Circles), we find that there are dozens if not hundreds of examples to choose from on any given day. As such, this page will be updated often with charts demonstrating this activity.
The common theme with the charts shown on this page is they are obviously all generated in code and are algorithmic. Some demonstrate bizarre price or size cycling, some demonstrate large burst of quotes in extremely short time frames and some will demonstrate both. In most cases these sequences are from a single exchange with no other exchange quoting in the same time frame.
And here, for your viewing pleasure, are the illegal market manipulative churn patterns conducted exclusively by various HFT algos:
07-29-10
BATS "Flag Repeater". 15,000 quotes in 11 seconds, dropping the ASK
price 1 penny each quote from $9.36 to $8.58 and back up again.
07-29-10
"The Crown". While not a large number of quotes, this NASDAQ/BATS
Bidsize sequence was just too unusual to bypass.
07-28-10
BATS "Batsicles". BATS price cycling through a large price range,
each intermittent with a stub quote, drop it down and start over.
07-27-10
NASDAQ "Blotter". One of the more unusual repeating Asksize
cycles.
07-23-10
BATS "Stubby Triangles". Drop the quote from a valid price to 0.001
and then back up to a lower price level. When the new price level hits 0.001 as
well, do it all over again at approx. 380 times a second.
07-23-10
NASDAQ "Flutter". 4000 quotes in 2 seconds, alternating the bid
price/size in 3 increments and effecting the Best Bid along the way.
07-23-10
BATS "Periscopes". 8000 quotes in 3 seconds, alternating the bid
price each quote. Pop the size up 1 every second or so.
07-22-10
NASDAQ "Double Dip". Symbol SH. 10,000 Quotes in 4 seconds, each
affecting the Best Bid.
07-19-10
NASDAQ "Racing Stripe". Symbol WYNN. 2000 Quotes in one second, each
affecting the Best Ask.
07-19-10
PACIFIC "Puzzle Pieces". Symbol IIC.
07-14-10
NASDAQ "Blue Bandsaw". Symbol SHG. (760 quotes in 1 second, taken
from a total sampling of 10,000 quotes in 12 seconds)
07-13-10
BATS "60-Step". Symbol SAH. Take sixty steps up (a penny at a time)
and one step down (0.60), reset and do it all over again (at approx. 700 times
per second).
07-12-10
NASDAQ "Ask Mountain". Symbol IAU. Over 56,000 quotes in 10 seconds,
all with same Ask Price and the Ask Size increasing or decreasing by 1 (to
almost 40,000!).
h/t Dan
(28 votes)
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on Sat, 07/31/2010 - 06:00
#497581
Ok, so who's going to jail? Wait..no one? Oh... I see... Well apparently all these "laws" aren't really "laws" after all.
Apparently, this is a giant free for all.
So I guess the lesson here is: Lie... Cheat... Steal... Stop paying taxes. Do whatever you like folks, because there are no cops! The proof is right up there for everyone to see.
On a daily basis the SEC shows us that there are no repercussions, and will be no repercussions for breaking the law.
Until we see 1000's (yes *thousands*) of bankers sentenced -- this will continue to be a complete and utter joke.
on Sat, 07/31/2010 - 06:21
#497592
Well now, in the first place this isn't real until a Gretchen Morgenson or an AEP runs with it. A Tyler Durden or a Matt Taibbi type can only serve as keen pointers for the guys (and gals) with shotguns. Of course, since ZH picked it up from a relatively obscure analytical source, it does demonstrate an information food chain in action. Deja vu. Did you just see that cat shudder twice?
on Sat, 07/31/2010 - 11:20
#497815
Two shudders and a hairball...
Look -- there's five-score monkeys over there reading ZH!
on Sat, 07/31/2010 - 14:18
#498006
America loks more and more like Russia.
Yes, we got a black president but he is just an incompetent, lying, marxist puppet in the hands of his masters. Our political landscape is becoming no different from Russia:
Yes, we are in a deep shit!
on Sat, 07/31/2010 - 17:03
#498166
I don't buy the Hebrew bit but other than that, dead on. The country I grew up in is dead and gone.
on Sat, 07/31/2010 - 17:15
#498171
doc--+1 on the joo thingie, please yourself, but I'd say don't loose faith -- there are kids and old farts alike who have not been heard from.
or despair your ass off-your call.
- Ned
on Sat, 07/31/2010 - 21:00
#498285
Concentrate the loot in a few small piles and it makes the job of the smart amoral scumbags that much easier. Centralize any organization - with lots of loot - and the sociopaths will run it. We've been centralizing power in the US since before WW2 but, on a big scale - continuously after WW2. No going back now though. It's very easy for sociopaths to destroy a democracy (after all, our government has already destroyed a few in the name of "freedom").
on Sat, 07/31/2010 - 12:15
#497869
Is there really no politician left in America who is willing to take this on and at least get some sort of answer from the SEC?
on Sat, 07/31/2010 - 13:19
#497933
Not really. Its financial warfare-kill or be killed. I would love to see them take this shit into the forex markets.
on Sat, 07/31/2010 - 21:08
#498287
For the last 50+ years, the political system in the US is nothing but a sociopath vetting process. The entry points into the system - at the local level - is where new politicians prove they are sociopaths (will say anything and lie in exchange for campaign contributions, called bribes in most countries). The owners of the combined Republicrat Party (there's two teams: a Blue Team and Red Team - our dumbass peasants are VERY easy to fool, the Party owners) allow the newbie politicians to advance if they don't threaten the nobility families that own the country. Very simple system; has worked very well. The nobility owns almost everything now.
on Sat, 07/31/2010 - 23:25
#498357
+1
on Sun, 08/01/2010 - 00:00
#498372
+100
People talking about change in November are fooling themselves. All the new faces I see, those who've been tasked with wrestling the Tea Partiers into line, talk tough about spending money.
But when you look a little deeper, the Scot Brown-s, Michelle Bachman-s, Shara Palin have a big hard-on for Zionist causes and are more than willing to spend your money and shed blood to prove it.
on Sat, 07/31/2010 - 06:20
#497593
Oh there are cops all right, but you need to determine which side of the law you are on. Do you have permission to conduct all of the activities that you do during the day? If so and you continue in the good graces of your clan or master, then all is well. One of your set might come to you one day and ask that you do a turn in stir to mollify the populace (Milkin, Madoff, etc), but no worries, you will just make more bones with the boss.
on Sat, 07/31/2010 - 15:31
#498094
I've been gone for a week so I'm not sure if this was posted on ZH but I saw this a couple days ago on the ICYMI RSS Feed....
High-Frequency Programmers Revolt Over Pay
on Sat, 07/31/2010 - 21:10
#498289
Programmers revolting? HA! In their dreams maybe. When it comes time to guard the re-education camps, the programmers and engineers will be the guards; probably the accountants too.
on Sat, 07/31/2010 - 21:50
#498310
God's code is God's code. In the Ark of the Covenant the code must remain, only the high preists are able to ssh into "those" servers...
on Mon, 08/02/2010 - 00:05
#499198
Yes, I enjoyed that irony. Sort of like an accountant for the mob going to jail for shaving a few grand from the drug operations.
America is truly screwed.
on Sat, 07/31/2010 - 06:28
#497598
This is what the 'new normal' looks like... Got to keep the top 20% happy or the house falls... Distract the remaining 80% and get reelected. It seems too easy.
on Sat, 07/31/2010 - 08:39
#497685
"distract the remaining 80%"
You mean like terrorists are everywhere...no, we are bored with that...
you mean like global warming...no, we are bored with that...
You mean like...a big environmental disaster in the GOM...except now there is no oil to be found, and we are becoming bored with that...
on Sat, 07/31/2010 - 13:34
#497949
How about a wedding?
on Sat, 07/31/2010 - 17:38
#498186
You mean Chelsea Clinton?
She has her mother's beautiful smile... Isn't she adorable! **cute**
on Sat, 07/31/2010 - 21:23
#498295
Bethenny getting married wayyyyy better.
Plus she had a baby.
Love those Real Housewives of NYC!
on Sun, 08/01/2010 - 14:25
#498764
how 'bout another World Cup?
those sport tourney's keep the team spirit alive - go RED, go BLUE, go NATIONS!
when's the next Super BAwl partay?
on Sat, 07/31/2010 - 13:57
#497979
"Got to keep the top 20% happy or the house falls... Distract the remaining 80% and get reelected. It seems too easy."
A cryptic reference to Vilfredo Pareto's law of social control; to wit, the top half of one percent run the show and reap most the benefits, but they must keep the next 20% of the population happy (those with the skills to replace them), and the bottom 80% don't matter.
Thus keeping prices elevated without having to spend real money is the establishment's wet dream. In a manner of speaking they are providing "liquidity" in that it is easier and less painful to sell into higher prices than lower prices.
But it is a sop to the next 20% - the group that should know better but that still wants to believe in the system.
And as Tyler so eloquently notes, risk just keeps rising through it all.
on Sat, 07/31/2010 - 19:54
#498240
Given these premis - I'd say personally that the critical "19.5%" is getting mighty fed up, and this is much more consequential than whatever the 80% is thinking.
Revolutions can and do occur within the elite.
In the context of Walter Russell Mead's taxonomy of American political classes, I'd call what's going on now a Hamiltonian civil war.
Coldish, for now, but heating up.
on Sun, 08/01/2010 - 08:58
#498468
By "Hamiltonian civil war," I hope the Jeffersonians win out...doubtful, yet hope worthy, imho. But then again, "hope in one hand & spit in the other, see which hand fills faster." The ever expanding coercive and compulsive power of the national government has its centralizing foundation with Hamilton & others. http://xroads.virginia.edu/~cap/ham/hampltcs.html
Politicians who make waves or attempt to actually do something about it are branded "moon-bats," to wit, Ron Paul.
Its every man for himself, so you better align yourself with the strongest gang if you want some measure of (political/economic) safety & security. Sad, but (risk of redundancy) imho, true.
on Sat, 07/31/2010 - 20:21
#498255
Back in 1920, Lenin had problems with his fellows Jewish member of his Bolshevik Party.
So, what did he do? Lenin expanded his Ruling Party Politburo with totally illiterate workers. Why? When one of them was asked whether they understand issues they are voting for, he gave a perfect reply: "No we don't understand the issues we are voting on but we ALWAYS vote ways Lenin instructs us to vote."
Do the Congressmen read the financial reforms bill (or for this matter most of other bills)? The answer is "NO" but they are allowed to add something for themselves. This is how American politics works. It is that simple.
on Sat, 07/31/2010 - 21:00
#498284
The same thing happens in Greece.
on Sat, 07/31/2010 - 07:02
#497613
Completely agree.
We need to find a nice little coastal island somewhere and turn it into a prison isle for criminal bankers. Barring that, it may be time for some vigilante justice, since the authorities clearly have no intention of stopping these crooks.
No, I'm not joking.
on Sat, 07/31/2010 - 12:08
#497859
I strongly disagree.We should throw them into a volcano.Katla demands a sacrifice!
Yes, throw them into the lake of fire.....before it is too late!
on Sat, 07/31/2010 - 13:24
#497941
Strap the fuckers to the electric chair and let the algos determine the amplitute.
on Sat, 07/31/2010 - 22:46
#498334
ampere**
Sorry. Couldn't resist.
on Sat, 07/31/2010 - 13:49
#497969
I like it, it is a way to bail out Iceland, they could charge (not too much either) for each event. - Ned
on Sat, 07/31/2010 - 14:27
#498015
I am most fond of gullotines. It takes one to two minutes for the brain to die after the head is severed.
I wonder what they think about in the interim, LOL.
on Sat, 07/31/2010 - 15:10
#498081
Probably about how they could scam you in 2 minutes.
on Sat, 07/31/2010 - 19:12
#498228
High powered rifles are cheap. 338LM will end any bankers tyranny.
on Sat, 07/31/2010 - 19:18
#498229
you bet. misguided children think "one round-one target"
Line 'em up and knock 'em down.
- Ned
on Sun, 08/01/2010 - 14:33
#498784
Like the Nazis did. One bullet can go thru four or five people when they're lined up.
on Sat, 07/31/2010 - 08:12
#497659
a joke? whats wrong with you people? these machines are the only thing keeping the markets up. do you want a complete collapse? do you want chaos? the next thing would be a real estate crash, gdp would plummet, unemployment would be 20% instead of 9%.
wake up will ya , they are doing all this for us.
oh shit i gotta go , the president is on a talk show, gee he has such a nice smile. later.
on Sat, 07/31/2010 - 14:33
#498021
Your questions are actually serious questions:
I do not want a collapse, but want a fair and real market and from there we can start to progress. If to get there, the current bag holders have to get a 70% haircut, well so be it.
No, I do not want chaos.
Unemployment is already at 20% and climbing. With real and trustworthy markets unemployment would 20% and declining.
Yeah, the Manchurian (err Kenyan) Candidate blew off a prior commitment with the Boy Scouts to be on "The View".
on Sat, 07/31/2010 - 16:33
#498144
Barry will no doubt get wind of this particular ZH article. It is linked into from Huff Po, average readership IQ of 91. I'll be damned.
on Sat, 07/31/2010 - 20:04
#498244
As of 9:00 PM EST, Saturday, guess how many comments has this article generated on HF (41). Next, guess how many comments has Chelsea marrying Marc has generated (313). Now, do you have any reason to ask why 'they' have been able to pull it off? I don't.
on Sat, 07/31/2010 - 21:26
#498297
"We have seen the enemy and he is us."
I just happened across this quote the other day - everything happens for a reason. bwahahaha. Seriously, what a disgraceful commentary. Time to pull collective head out of ass.
on Sat, 07/31/2010 - 22:00
#498317
VI, it is kinda strange to call you that. I have read your commentary and your moniker doesn't do you justice. You are much smarter than the most of us here. However, not knowing your real name, I guess I'll have to address you using your nom de plume.
Yes, I do agree, what a disgraceful commentary. You know what, it's much worse out there in the real world. I 'experiment' with my friends, colleagues and acquaintances and leave the encounter stunned, worried, saddened and concerned. I ask them the most basic question - 'what is money' - and am utterly stunned by their responses. These are the same people who are managers and directors at fortune 500 companies. I was in Chicago once and an executive from UBS happened to be sitting next to me at the hotel bar. And I asked him about his views on the economy. His response was, he doesn't know, he doesn't care, he doesn't think about it, and as long as he has a job it doesn't matter. The stock market is coming back and that's all that is important to him. Rest is inconsequential.
I am sure, most people in the U.S. would share his view. Revolution? What revolution? Keep the indexes rising and the rest will be forgotten by the masses.
on Sun, 08/01/2010 - 01:12
#498391
Thank you for the compliment, Sisyphus. And the guy you refer to, was me. Still safe, but not feeling secure. Take care.
on Sun, 08/01/2010 - 08:57
#498476
Sarcasm noted, and appreciated. +11 to counter "junks."
on Sun, 08/01/2010 - 15:02
#498820
i recognize sarcasm when i see it. Well done and never mind the junkers, they are impervious to sublety.
on Sat, 07/31/2010 - 08:20
#497664
No, Popo, there are PLENTY of cops, lots and lots of cops, SWATs, soldiers, detectives, prosecutors, and so forth--this is a POLICE STATE, after all.
The problem is that all that enforcement we pay through the nose for is to keep the sheeple in line, particularly the upper middle-class, who have something to lose, thus are easy to terrorize, and holding a bit of coin to shake down at every opportunity. Wall Street is off the hook, my friend.
Nothing will change until the system changes.
on Sat, 07/31/2010 - 08:32
#497673
The upper middle class is the dangerous parties to the fraud. They are typically educated, informed, and well read but, moreover, they are close enough to the elite to see and understand the fraud. When they get the feeling that their comfortable yet less than opulent life is going into the shitter then they mobilize and organize. That's the danger. When I see my ability to provide for my family going the hell-in-a-handbasket and my kids future in jeopardy...I get a wee bit pissed.
on Sat, 07/31/2010 - 09:39
#497732
Right you are. The UMC works for the Oligarchy. Like all workers, their loyalty is rented.Obama is gambling that the lower classes will coalesce around him while he fleeces the UMC, but my money says otherwise.
on Sat, 07/31/2010 - 10:15
#497755
Anger within the ranks of the UMC. I'm seeing it every day. Refreshing.
on Sat, 07/31/2010 - 13:35
#497950
VI, THIS member of the UMC is pissed too. I do not work for the Oligarchy because I don't (for the most part) work. What work I do is for our own little Peruvian bearing company.
Like all of you above, what more do the Regulators need to see to get their d**n investigations going?
They have to be in on it, as someone above suggested. They know it's going to crash and get very ugly. And then we line the whole lot of 'em up: politicians, HFTs, "Regulators", banksters and throw them into Katla. Trial could take place in Reykyevik (sp?), would merely take an afternoon to prove them ALL guilty, put them into a fleet of dump trucks, and into the volcano they go. On the other hand, that lot might not be tasty, Katla might blow up after feeding her THAT garbage.
Yeah, burns my butt too. THERE is the evidence (great work Tyler), now let's get 'em.
on Sat, 07/31/2010 - 12:10
#497861
We shout and scream in anger and nothing changes. What we need is action. We need to unit together against the banksters. Do you think they will hear us if millions of us on a single day marched into our banks and closed every account we have withdrawing all of our money? If we can organize that movement which is completely legal it would shut them down in a single day. Lets get it going.
on Sat, 07/31/2010 - 15:50
#498110
just do it.
i did it.
bank of rapunzel Ω
on Sat, 07/31/2010 - 21:34
#498302
"We shout and scream in anger and nothing changes. What we need is action"
lets keep it rolling.
on Sat, 07/31/2010 - 09:38
#497730
Its obviously a free for all, considering these algos are throwing thousands upon thousands of quottes per second.
The next trading I am more interested in doing is bartering.
The sudden stop is comming.
on Sat, 07/31/2010 - 09:46
#497737
Welcome to Arizona...
on Sat, 07/31/2010 - 12:42
#497892
Even the folks who handle the crime scene are a crime scene. Signs of collapse
on Sun, 08/01/2010 - 15:10
#498830
Bps crime scene in the gulf. And they are still in charge, 2 million gallons of poison to prove it. Now folks are showing up with internal bleeding. Meanwhile i keep seeing major blowouts on the seafloor last few days.
But folks arent being warned and few know of the oilrain killing plants and how birds and bugs are reported as scarce to none.
If we had a government of the people they would be warning us instead of hiding reality. This is government by criminals, financial pirates.
on Sat, 07/31/2010 - 12:53
#497904
Could they be adding fluff to the pricing in order to sell calls and crush everyone just before option expirey ? fluff and crush, rinse repeat
on Sat, 07/31/2010 - 13:06
#497918
+ 100
on Sat, 07/31/2010 - 15:39
#498102
Here it is, market manipulation.
http://www.youtube.com/watch?v=alHpQ7yU6a4
on Sat, 07/31/2010 - 18:30
#498212
Popo, No one will go to jail. The system is corrupted beyond hope, the regulators are captured and will not go against their future HFT employers. As in any fascist society, the small to save (about 99% of americans) and the weak will be hammered, bullied and threatened into submission. We will be fined, jailed, subjected to oppressive taxation whilst the banksters will buy their way out of trouble; for the recalcitrant few politicians who cannot be bought or blackmailed, they can always be suicided. Our only hope is to overthrow these bastards before we become completely enslaved.
on Sat, 07/31/2010 - 05:56
#497582
WTF?
on Sat, 07/31/2010 - 08:32
#497674
WTFWJD?
on Sat, 07/31/2010 - 09:23
#497716
Mark 12:17 (2010 translation)
Then Jesus said to them, "Give to Blankfein what is Blankfein's and to God what is God's." And they were amazed at him.
on Sat, 07/31/2010 - 10:32
#497767
Luke 21:20
But when you see _<fill the blank>_ surrounded by armies, then know that its desolation has come near.
on Sat, 07/31/2010 - 09:26
#497720
snicker
on Sat, 07/31/2010 - 06:04
#497584
So what do you recommend , Go long, Go short or get the fuck out of the market?
on Sat, 07/31/2010 - 06:27
#497597
#3 - this market is a haunt for vipers, demons and professionals (yes you need a scorecard to differentiate). Unless you are a wunderkind chartist of Johnny Bravo caliber, I suggest you act defensively as the scheme will ultimately unravel and devolve to B9K9's last resort...
on Sat, 07/31/2010 - 07:18
#497628
Agree, get the fuck out of the market now!
on Sat, 07/31/2010 - 08:06
#497656
Nonsense, Skynet is not self-aware.
What you do is put your big-girl panties back on and stop trading and start investing. Given the widespread (and only increasing) use of HFT your horizon may have to increase from seconds to months.
Oh, the last catch is to invest in companies making money, not lies and profits based off the giant government mammary gland in the sky.
Good luck traders, this is the writing on the wall for most.
on Sat, 07/31/2010 - 08:34
#497675
If you can't touch it, don't own it. Why play their game and be an enabler? Still trying to get rich? That's the mentality that's destroying the moral fabric of the world. Everyone wants to be rich I won't lie (unless your a monk), but one must draw a line.
edit: Upon reflection, most people I know don't want to be rich, they want to be left the fuck alone and being rich allows for that.
on Sat, 07/31/2010 - 13:29
#497945
"most people I know don't want to be rich, they want to be left the fuck alone and being rich allows for that."
I second that motion. I really do. The only reason i am in this game is to get out of it.
on Sat, 07/31/2010 - 14:43
#498051
That is not the ruling class philosophy. They want to be the popular kids and will sell their soul to feel that their worthless lives are actually good lives ... they need constant reinforcement.
on Sun, 08/01/2010 - 01:15
#498392
"most people I know don't want to be rich, they want to be left the fuck alone and being rich allows for that."
I second that motion. I really do. The only reason i am in this game is to get out of it.
Beat me to it.
on Sun, 08/01/2010 - 02:33
#498402
outa...
your statement has been made in many different ways in here, but seldom as well.
it's my litmus test on new laws and ideologies:
"will your 'proposal' allow me more distance from the 'system', or force me closer to it?"
disengage.
+++
on Sun, 08/01/2010 - 14:46
#498801
++ many awareness points to be divided with y'all above.
"will your 'proposal' allow me more distance for the 'system,' or force me closer to it?"
that's my litmus. "are you gathering yet more information about me, to be used against me? yes? then GTFO"
on Sun, 08/01/2010 - 00:20
#498380
They use every $1 that is invested/deposited and apply their 10-100 times leverage and use it to game the markets. So if you put 10k into a position, they have 100k-1M new money to play with. Go short short short! There are signs of desperation in their market manipulations. Arch Crawford is right. There is going to be a big dump in the market in the next week or two. Go SHORT.
on Sat, 07/31/2010 - 13:27
#497930
You rang? The reason there's so much vitriol & pure emotional reaction resulting from these revelations is due to the vast majority of people failing to realize that the last resort was executed long ago. OK boys & girls, I'm going to say it once again, very slowly this time - please repeat after me:
The USA is a fascist oligarchy which utilizes military power to control critical strategic resources that supports a fiat money system used to manage a global empire.
This system (aka the "MIC") was placed in service @ the end of WWII. Since that time, we have always lived in a managed war-time economy. It only appeared to function as a free-market system that followed basic rules of law as a mere convenience. That's because it was easier to control the herd than to admit the underlying Constitutional system had been upturned.
Btw, this isn't some deep seated secret conspiracy either. Millions (10s of millions?) of people have, and continue to, benefited from this arrangement with perfect awareness. I had a great UMC upbringing and knew it the entire time. The father (a wealthy MD) of my first girl-friend was perfectly frank in declaring we needed another war after Viet Nam to get the economy going. This is how people thought & still think in intelligent circles.
Now that the power-elite are faced with the most critical challenge to their control & power, the trappings that were merely for show are being ripped away. After all, maintaining an illusion of this scale is a luxury they just cannot afford during this kind of emergency.
So now everyone (that is, the clueless) are waking up and are shocked, shocked I tell you! Denninger would have to be among the most pathetic. His constant braying about the law would be funny if it wasn't so sad.
Let me summarize how this is going to play out: the power-elite are either going to pull off blowing another bubble, or they aren't. If they do, this outrage will quickly be forgotten as everyone makes a mad dash to catch the gravy train. If they don't, then we're either going to have a military coup or (series of) secession.
Either way, the USA as we have experienced it during our entire lives is done, kaput, all pau.
on Sat, 07/31/2010 - 14:07
#497993
... we're either going to have a military coup or (series of) secession.
Will Arizona be the first one out?
on Sat, 07/31/2010 - 15:50
#498111
Rickards actually mentioned AZ and the threat to the Central Power command in his latest KWN interview. The cure for complexity bloat is simplification and decentralization, either embraced or imposed. Think locally, act locally.
on Sat, 07/31/2010 - 21:19
#498294
Yes, but the myth isn't dead in the peasants yet.
I think TPTB can still use the natural peasant fear of "those people" too keep them in line for many decades. And, with enough eagles and flags (in slow motion) the dumbasses will still think they are REAL Mericans.
Look out, "they" are gonna git yer daughter! "They" are right behind ya. Only a powerful Merica can save you now. "Those people" are using your "rights" to git yer daughter. Give us those rights and we'll protect you!
Works every time. Same clowns, different circus.
on Sat, 07/31/2010 - 21:40
#498306
Funny to see that you have such a black and white perspective. Reality may be in the gray areas.
What happens if a semi-bubble is blown up taking 10 years to do so? How much ad revenue will bilda-bear websites earn during this period? And while we're talking about periods....
Just thinkin out loud, dawg.
on Sat, 07/31/2010 - 22:00
#498316
Here is some interesting reading as to how they did it:
http://www.usa-the-republic.com/revenue/ucc%20connection.html
I would love to hear hear from some lawyers confirming the above
on Sat, 07/31/2010 - 08:08
#497657
Explosives. LOL.
on Sat, 07/31/2010 - 06:07
#497585
So, don't play a rigged casino.
Invest in baseball cards or Star Trek chit.
on Sat, 07/31/2010 - 06:09
#497586
HFT NOW DOES THE JOB OF THE PPT...
on Sat, 07/31/2010 - 07:30
#497634
They have figured out how to salvage the recources of the PPT via HFT, and you can throw in the illegal rumormill of speculated M&A and other various "news" driven moves that are no more than market pump at our expense.
on Sat, 07/31/2010 - 08:35
#497678
EXCELLENT! Now they can surf porn too and the job will still get done! Life is good. Really good.
on Sat, 07/31/2010 - 06:11
#497588
Look at the pretty pictures... Do algos do 3D?
on Sat, 07/31/2010 - 13:21
#497934
I was thinking more like musical notes. Such beautiful scores.
These markets not only fly, they sing, as well.
Hey, look, that server is putting out a mating call!
on Sat, 07/31/2010 - 06:13
#497589
If you can't beat them... join them? What if everyone got into the HFT game?
on Sat, 07/31/2010 - 06:31
#497600
Not everyone can get into the colocation game, so just how fast do you think you can be? Faster than the next guy? It would be a painful lesson to find out that your hardware/software investment was in vain - but thanks for supporting the economy there Mr. Quixote!
on Sat, 07/31/2010 - 09:49
#497739
I think I've seen this movie before. When the market has another "flash crash" and cannot recover, there will be incredulous statements from the SEC, "We could not have seen THAT coming!". Right, like nobody saw the housing market crash. Uh-huh. Now is the time for action, not later with deniability. Wonder how much money can be driven to bonds with a really scary market crash? What we see in the charts above are the trial runs and tests to see which of the systems will create the most/least damage while maintaining some semblance of control.
on Sat, 07/31/2010 - 11:53
#497842
Rocky, I like your thinking. We do the same thing, put in 1% step and characterize the system and control system response. I'd bet these folks are assuming linear time-invariant response (remember, they assume Gaussian distributions in B-S and other "predictive" equations).
So does the system function stay the same? I doubt it for big moves and for moves more than say a month out.
- Ned
on Sat, 07/31/2010 - 12:00
#497851
It might turn out like the early experiments in making meth, it works until it blows the shed all to hell. These guys are playing in real markets. Imagine what mayhem they are doing in closed-system synthetic market models. What appears like the graphs above are what escapes from the lab!
on Sat, 07/31/2010 - 12:54
#497906
Meth is a good analogy including those burglaries to steal chemicals for the big jobs
on Sat, 07/31/2010 - 14:05
#497990
I'd say that these are early experiments as well. And the small-signal nature is the meth pot cooking along, until something goes exothermic and the "reaction" gets out of the previously controllable condition. I've been thinking the flash-crash was something like that. Not sure that these are escapees, maybe .spx price on millisecond or microsecond scale is the escapee.
- Ned
(p.s.--there was a time when I could use the word "ergodic" correctly in an English sentence; alas, no more).
on Sat, 07/31/2010 - 16:03
#498116
Hey, Meat! You sound like you know way too much about cookin' meth.
on Sat, 07/31/2010 - 17:28
#498173
every time I've peed into the bottle, THEY COULD NOT FIND ANYTHING.
i have no idea what you are talking about.
- Ned
OT-my bunkmate at an exclusive boys summer camp buried himself into Nimitz ass and left behind two little girls. Navy started the pee-in-the-bottle thing and found, well ... "grass" 'board a grey boat.
- still Ned
on Sat, 07/31/2010 - 06:13
#497590
Whoa! The Unravelling the HFT mystery.
How can the average investor even stand a chance.
But even this will blow over. There is not enough angst left in us, no vitality left to fight, even the most egregious crimes against us.
We're happy enough venting with words.
We'll end with a whimper at this rate.
ORI
http://aadivaahan.wordpress.com
on Sat, 07/31/2010 - 06:22
#497595
Those in complete surrender have taken the position of ultimate power by shirking all responsibility.
on Sat, 07/31/2010 - 09:22
#497715
That is f'ing brilliant.
on Sat, 07/31/2010 - 10:47
#497781
Brilliant. The true power of "surrender" could not possibly be understood by the sheep at large. Most sheep see "surrender" in the context of "surrender, and the terrorists win...." or some other false description of the word that has been implanted into their simple, washed brains.
One must surrender, accept what is, in order to be master of one's self and attain ultimate power.
on Sat, 07/31/2010 - 11:38
#497830
Most people have to survive some sort of end-of-the-road or near-death experience to crossover into this viewpoint / existence.
Seems that the opportunities for such experiences are on the increase.
on Sun, 08/01/2010 - 15:06
#498824
the acceptance of what IS includes surrendering the illusion of control over All That IS. . .
the "ultimate power" wordage has too many "meanings" and can be con-fusing when not defined. . .when truly embodying a full surrender, one acts, observes, and surrenders the outcome, simultaneously.
Power-full.
on Mon, 08/02/2010 - 04:46
#499259
...
Well said CA. Spot on.
ORI
http://aadivaahan.wordpress.com
on Sat, 07/31/2010 - 10:31
#497759
you must have missed the "bumper sticker" memo. getting a voice back - it's a start.
Originally Posted July 30, 2010
Anyone interested in taking a step, albeit very small, to get something off the drawing board?
I've been thinking about a sticker, bumper size, that identifies American Patriots. I think that includes a large majority of the ZH community. But wouldn't directly identify said patriot as a member of ZH.
Personally, I'd like to be driving down the road and give a thumbs up to the person next to me. It's a start.
keep it simple, but identify two main themes - "patriot" (someone who cares and understands what is happening in this country) and one other word. A word that tells the oligarchy that we are on to them (I could use some help here). I'm thinking of some reverse psyops like, "dumb" perhaps. Dumb Patriot. Dumb may not be the word, but "they" do consider us as some form of dumb.
I use the the avatar "Village Idiot" because it acknowledges right up front that I may be, and sometimes am, the VI. But you can't use it against me because I am the VI, after all. We both know. That is the key - one word that represents the power of the people, and another word that signifies a mutual understanding that, to the contrary, we aren't dumb.
I need a little help developing this, though, but hopefully you get the idea. I would be privileged to contribute any way I can, financially or otherwise.
I hope this idea gets some traction - I really would like to be running down the road and give a big thumbs up to my fellow Dumb? Patriot.
I'll probably post this around the site and see what happens. Cheers.
EDIT: For you "Oligarchy" may not be the defining word or group that is taking us down. Feel free to replace with something else. Also, a poster was kind enough to point out that this is not just an "American" issue. A global translation would be even bigger.
on Sat, 07/31/2010 - 10:48
#497783
How about "Being:Aware"
on Sat, 07/31/2010 - 10:54
#497794
thanks for the reply steve.
on Sat, 07/31/2010 - 14:46
#498013
Good plan VI. It does need to start somewhere.
But given where things are and where we (as in everyman) have reached as beings, something more substantial will cause the shake-up needed.
Now a strike is aggression (it's in the name/word/symbol, regardless of it being a peaceful "strike", I'm sure the oxymoron is clear to behold.
Eye for eye and the whole world.....etc.
So first we need to intelligently re-language what word to use in an act of subverting the system without violence, implied or real.
Also, violent actions bring about violent change, quite needless. We do not need more violence.
I have a solution. It is the most graceful way to pull the system back. An effortless and face saving return to the saddle. A way to reach a place where HAL will always remain a piece of fiction. A path for us, individually and collectively regain our "selves".
The first step is the hardest one. That's no cheap cliche.
I was given a key, six years ago, almost to the day.
I'm absolutely and completely serious. If a 1000 people were to co-ordinatedly do and document their practice of what I call Luddite Karate, we could seed a shift of something, perhaps just perspective.
Often, that's all it really takes.
Can I find them here? Or here and within six degrees?
My sixth sense always goes into "high" mode on ZH, particularly in my interactions with people on certain topics.
Resonance is just a 1000 people clapping together.
It's how they built the pyramids in Egypt and the monasteries in Tibet.
Through the largely lost art of directed acoustic resonance.
I'd like this community to help me find the 1000, with due kudos to ZH for creating this mind-bending community in the first place.
Remember too, that we are coming into the age of Aquarius,
From Wikipedia:
Ages are believed by some astrologers to affect mankind while other astrologers believe the ages correlate to the rise and fall of mighty civilizations and cultural tendencies. Aquarius traditionally "rules" electricity, computers, flight, democracy, freedom, humanitarianism, idealists, modernization, rebels and rebellion, mental diseases, nervous disorders, and astrology.[4] Other keywords and ideas believed associated with Aquarius are nonconformity, philanthropy, veracity, perseverance, mankind and irresolution.[5] The appearance or elevation in status of many of these Aquarian developments over the last few centuries is considered by many astrologers to indicate the proximity of the Aquarian age. There is no uniform agreement about the relationship of these recent Aquarian developments and the Age of Aquarius. Some astrologers believe that the influence of a New Age is experienced before it arrives because of a cuspal effect or Orb of Influence. Other astrologers believe the appearance of Aquarian developments indicate the actual arrival of the Age of Aquarius.
Well, I'd say this is an Aquarian group. We have all the characteristics, save irresolution, which I did not quite understand.
Come on by....
ORI
http://aadivaahan.wordpress.com
on Sat, 07/31/2010 - 21:02
#498210
"Resonance is just a 1000 people clapping together."
that's easy, i'm in.
on Sat, 07/31/2010 - 21:44
#498307
What?
on Sun, 08/01/2010 - 01:18
#498393
I'm clapping.
on Sun, 08/01/2010 - 10:16
#498524
Hmmmmm.....
ORI
http://aadivaahan.wordpress.com
on Sun, 08/01/2010 - 15:34
#498852
. . . and what was thought, is now shared, holding the space begins with intent.
I'll add that the Aquarian archetype has two planetary rulers, Saturn (of old) and Uranus ("discovered" more recently). . . Saturn represents the "status quo" or the structures built to contain the intent / vision / beliefs, including personal and the collection of persons known as "cultures". . . when the structures are outgrown, there can be a "breakout" - which is Uranian, the overthrow of systems that are now limiting further growth. . . Uranus was the first planet to be "seen" with a telescope (technology invented which furthers the culture - Saturn). . . Uranus was "seen" a few years before the American, and French Revolutions. . .
I'd agree that the ZeroHedge community embodies both sides of the Aquarian archetype, with some still holding their cultural positions, and others breaking out of the accepted "reality," turning around to point fingers and mock. . . here's hoping more will apply the need for "change" to works that further a new "vision" - a personal revolution embodied for cultural shift. . .
Resonance. It's how we "find" each other. . .
on Mon, 08/02/2010 - 04:50
#499261
"Resonance. It's how we "find" each other. . ."
Yes...yes.
Anyone resonating?
ORI
http://aadivaahan.wordpress.com
on Sat, 07/31/2010 - 14:11
#497999
Village not an--I have refined my business case, here goes. Team with:
https://americantees.com/bs_removal_kit .
It will sell like hotcakes, both the removal and the new sticker. Especially after the training video is viewed:
http://www.youtube.com/watch?v=xn_IAwe8-q4
No affiliation, dang.
- Ned
on Sat, 07/31/2010 - 21:36
#498213
Village not an--I have refined my business case, here goes. Team with:
https://americantees.com/bs_removal_kit .
It will sell like hotcakes, both the removal and the new sticker. Especially after the training video is viewed:
http://www.youtube.com/watch?v=xn_IAwe8-q4
No affiliation, dang.
- Ned
Joint product launch, my pig!
I hope that 75.9% of this site see's the first link. The bestest.
on Sat, 07/31/2010 - 12:23
#497875
I don't agree. I believe that there are millions and millions of people willing to act and act now. We need to unite with a cause. We need a way to to create a single granuality to push a wave in one direction or another. The teachers union can control the outcome of an election, why can't we unite and take the banksters down in a single day? We can. Its easy. We just need to set a date in the future and spread the cause. A national bank run on a single day. Let's freaking do it.
on Sat, 07/31/2010 - 12:54
#497905
your post has merit for sure. whether it be a bumper sticker, or something else, the awareness level has got to come up. What is that symbol of awarness going to be? all in the spirit of peace, of course. thanks for responding.
on Sat, 07/31/2010 - 13:54
#497967
Let's pick a day and make this easy for everyone. How about Thursday, August 12?
EVERYONE goes to their ATM (early enough during the day) and pulls out the max you can. When the machine runs out of money, go into the bank and ask for $1000 (sort of a fine on them for not having enough money in the machine).
I pick Thurs, Aug 12 because it gives a little time to organize and get the word out. Then Thursday's and Friday's market action would be REAL INTERESTING, hmm?
I'm ready, let's do it. Thanks again VI for your call to action yesterday.
EDIT: I think I am going to repost this a few times in similar upcoming threads. Alternative ideas welcome (as VI has said). Oh, and buy some gold too.
on Sat, 07/31/2010 - 14:23
#498010
Most banks have limits on how much a person can withdraw in cash on one day.
on Sat, 07/31/2010 - 14:39
#498035
ANY bank will let you take out a lousy $1000, perhaps until August 12.
Oh, and send the SEC / HFTrs / banksters / politicians, etc. for a quick trial in Iceland, put 'em all in dump trucks, and throw them into Katla.
on Sat, 07/31/2010 - 19:03
#498219
by DoChenRollingBearing
on Sat, 07/31/2010 - 11:54
#497967
"Let's pick a day and make this easy for everyone. How about Thursday, August 12?
EVERYONE goes to their ATM (early enough during the day) and pulls out the max you can. When the machine runs out of money, go into the bank and ask for $1000 (sort of a fine on them for not having enough money in the machine).
I pick Thurs, Aug 12 because it gives a little time to organize and get the word out. Then Thursday's and Friday's market action would be REAL INTERESTING, hmm?
I'm ready, let's do it. Thanks again VI for your call to action yesterday.
EDIT: I think I am going to repost this a few times in similar upcoming threads. Alternative ideas welcome (as VI has said). Oh, and buy some gold too."
*********************************************************************************
I'm feelin' the juices starting to flow!
I just put "PULL MAXIMUM AMOUNT FROM ATM AUG 12" in my Outlook (microsoft).
How about a weekly/bi-monthly/monthly action plan? an idea, doesn't need to be a "majority vote" kind of thing - just the most passionate (and legal) idea to come forward that draws people together.
If you commit to this idea/plan, then you do your best to follow through. Encourage friends to follow along. Keep it rolling.
The ATM idea would be a great place to start.
PS - with the right PR assistance something like this could get coverage. And with the right people up front...a new political force, perhaps?
on Sat, 07/31/2010 - 20:16
#498254
I think a successful protest requires coordination. We need to determine the medium of communication. I think it is clear the internet as it is free and not under the control of our facist government. I like the idea of a bumber sticker. What if we had a bumber sticker "Withdraw $$ Or Government Will - March 10 2011"
on Sat, 07/31/2010 - 21:15
#498291
"I think a successful protest requires coordination. We need to determine the medium of communication."
Agreed - Coordination isn't my strongest suit, but I would venture to guess we need a meeting place (forum) that is dedicated to the project. And some sort of bulletin board. Any thoughts out there?
on Sun, 08/01/2010 - 00:54
#498386
Twitter.
on Sun, 08/01/2010 - 01:21
#498394
Never used it. If it works, so be it.
on Sun, 08/01/2010 - 02:20
#498399
Word will spread the fastest on Twitter. Find someone who will tweet their friends, who will then tweet their friends, who will tweet their friends, and so on. Date, time, and amount of withdrawal. You could actually reach critical mass with Twitter. Other blogs would pick up on it, and maybe the MSM. Good social experiment. It is your idea. Make it happen.
on Sun, 08/01/2010 - 08:26
#498455
Google: "meetup" and get
About 6,330,000 results (0.11 seconds)
Iranians were using twitter and meetup.
But, thanks to suzie and olie, Our Dear President now has internet kill switch.
What does that do to FX and futures traders who are monitoring trades minute by min...?
- Ned
on Sun, 08/01/2010 - 10:07
#498513
"It is your idea. Make it happen."
Good input, thanks. However, this little gem is not my idea - my calendar is marked for august 12th, though.
on Sun, 08/01/2010 - 12:37
#498664
.
.
Twitter and Google meetup are two technologies I know nothing about. But I have a Google account so I will start learning right away.
I have posted my $500 out the ATM 5 times here at ZH, once over at fofoa and emailed it to all my financially literate friends and family.
on Sun, 08/01/2010 - 15:31
#498848
There are groups that do spontaneous things en masse. seen it but forgot names. This can be done. Be aware NSA has an eye on all of us. (ear)
on Sat, 07/31/2010 - 06:22
#497594
Seems the market is well and truly rigged and a game for those that think they can outmanuever a computer. Just when you think there are limits to the crime and corruption the government endorses for its friends another one comes along.
on Sat, 07/31/2010 - 09:42
#497723
My father-in-law was the managing partner at a large regional brokerage firm in the 50's, 60's and early 70's. This is nothing new, folks. The markets have always been rigged. The digitalization of trade data just makes it easier to see.
Do you disagree? Please point to a time period that you believe the financial markets of the USA were not rigged.
Sidebar: On slow summer afternoons my father-in-law would run a small trade on a stock at the very top of the (chalk) board just to get the girl wearing a skirt to climb the ladder and change the quote. Good times...good times.
on Sat, 07/31/2010 - 10:22
#497760
Haha, i guess pasty faced male interns are a thing of the present :/
(Thanks for the illustration hh)
on Sat, 07/31/2010 - 11:46
#497838
Today that gal would be going up and down the ladder several THOUSAND times per second.
Why wear clothes?
on Sat, 07/31/2010 - 16:17
#498128
speaking of ladder tricks, mine didn't quite work out, that trick i mean. fell 15 feet down. ladders are very very very dangerous.
F A I L ‡
on Sun, 08/01/2010 - 11:16
#498583
Up a ladder and down a pole...perfect. Where's robo, we need pics.
on Sat, 07/31/2010 - 06:28
#497599
Call me naive but print this off and send a well-written letter to Mary Shapiro, with a cc: to your congressmen and senators. Will it do anything? Probably not, but at least the issue will be on record....
You can't begin to hold people accountable without a record of trying.
on Sat, 07/31/2010 - 06:37
#497604
The issue is on record and they know it...but the masses don't understand and don't care as long as the cable TV still works and fast food flows.
on Sat, 07/31/2010 - 10:27
#497762
Are you kidding?
About 95.4% of the people here don't understand this post. My guess is a place like EliteTrader or maybe the Wilmott forums about 1/2 the people would understand it. Sending this to any sort of government agency unless theres a new one called 'US Dept of Quants' will simply have this mistaken for spam and be put in the trash.
on Sat, 07/31/2010 - 10:53
#497791
Yeah, using computers to generate phony prices, slow down Einstein...
on Sat, 07/31/2010 - 11:10
#497808
My argument with you doesnt extend beyond the CSCO circuit breaker thread. I see no reason for your attack here, so i assume youre still bitter about your un-printed market order fill at an unfavorable price.
on Sat, 07/31/2010 - 11:40
#497834
Um, you just insulted the vast majority of readers here (about 95.4%, I think), and you're the victim?
on Sat, 07/31/2010 - 12:35
#497884
Oh really. Are insults only supposed to be false accusations? Or do you want to tell me every person posting in this thread, you included, could explain to me what said quote stuffing is? For the record, if it wasnt for some quant friends, this post would have been over my head too. Luckily for me, i dont shy away from learning new stuff from forums, blogs, friends; anyone more knowledgeable than me. It seems like you however simply don't want to admit youre wrong on many, many topics so far. I guess it would suck to delete all those blog posts of failed info huh. Its a good thing HFT is given spotlight by places like ZH and Themis - after which ultimately the MSM catches on to.
Since youre incapable of any interesting discussion, i suggest you educated yourself with some excellent white papers and books on the markets just a quick goog search away.
on Sat, 07/31/2010 - 13:49
#497968
Since you won't stop, yes I will explain this to you.
Our stock market has become one giant turd sandwich (that's the essence of this post). What passes in your mind as "interesting discussion" is chattering on about the composition and nutritional value of said sandwich. Oooh look, you found a kernel of corn!
Honestly, I don't care how much you and your "friends" know about turd sandwiches, because at the end of the day, it's still a turd sandwich your describing. It's when you try to sell it as anything else, I've got a problem.
But please, keep refering to my posts capturing snapshots of price manipulation. I know you and all the rest of the turd sandwich vendors would just love to see them deleted.
Your friend,
Mark
on Sat, 07/31/2010 - 15:13
#498082
Theres too much wrong in your post to comment on it again and again so just enjoy trading in this turd sandwich, good luck.
on Sat, 07/31/2010 - 23:45
#498364
"Oooh look, you found a kernel of corn!"
i love this place.
to hell with subtle, and/or apologies... just do it mm. just do it.
on Sat, 07/31/2010 - 11:06
#497805
"You can't begin to hold people accountable without a record of trying."
profound.
get it in writing!
on Sat, 07/31/2010 - 06:34
#497602
Amazing.
The bankers and politicians have a choice:
Jail now or revolution later.
on Sat, 07/31/2010 - 13:24
#497943
Wrong.
They will probably take Tony Gayward's path to impunity
You fools! Do you actually think he's being punished by being sent to Russia?
THE US HAS NO EXTRADITION TREATY WITH RUSSIA !!
He's walking away and announcing it in broad daylight...
AND NO ONE IS RAISING HELL ABOUT IT??
He should be wearing a tracking device around his neck and not be allowed
to leave Louisiana!
on Sat, 07/31/2010 - 06:37
#497603
Could a state AG take this on?
on Sat, 07/31/2010 - 06:39
#497606
They won't. They will nab a few high profile ponzi schemes and say look what a great job we did. Their 401ks and pensions are handled by the algo's....they won't touch their cash cow.
on Sat, 07/31/2010 - 08:20
#497665
bernie madoff , or a lookalike was seen leaving a mcdonalds in costa rica a couple of days ago.
on Sat, 07/31/2010 - 06:40
#497607
I have seen this through level 2 quotes....A 48K share bid shows up then as soon as the stock moves up, it's gone.....If the stock starts to drop down, the 48K bid size shows up again...
on Sat, 07/31/2010 - 06:49
#497609
Here's something else I don't understand: why can't the computers on the sell side match the speed of the HFT computers?
All it would take is a few of those stuffed bids getting filled to put some of these fuckers out of business.
You want to buy 100,000 shares of AIG at $100? Really. Good--because your fucking sham bid was executed, and you own them now, motherfucker. Choke on it!
on Sat, 07/31/2010 - 07:34
#497638
Bump.
Very good question...
on Sat, 07/31/2010 - 10:11
#497748
No, thats when the reset button is hit, the transaction gets cancelled, NYSE puts out a bulletin that trading is temporarily halted, and the feds and SEC go out and forcibly remove your computers, and nobody will find out about it because the FOI act will not be applied to the SEC.
on Sat, 07/31/2010 - 10:39
#497775
Bid would never get hit.
Im familiar with ARCA where the average raw response time is around 0.6-0.7ms. Add on the latency and whatever queuing is there, prob end up being around <2ms. Thus any decent ECN should be 2-3ms total.
Get a colo in with some racks, gigabit close to the center, youll be good at that quoted time.
Retail will most likely be .3-.5seconds.
Seeing as how computers are thousands of times faster than humans, the only reasonable solution is to have HFTs battle it out themselves.
on Sat, 07/31/2010 - 23:47
#498365
+++
retail with a 'live' ajax or flash-based web-interface- what, 2 seconds?
better not be counting the pennies on those shares...
on Sat, 07/31/2010 - 08:38
#497682
national security would not allow it.
on Sat, 07/31/2010 - 09:01
#497702
Fat finger unwind...
on Sat, 07/31/2010 - 10:37
#497774
Knowing your 100,000 shares of AIG will be worth $200 a share with a couple weeks of pumping, why would you sell it at $100 today?
on Sat, 07/31/2010 - 06:59
#497612
As with my post on the "flash crash" that said that circuit breakers ar eneed to suspend orders when the next quote is a gap of a number (like 10%), the answer to this HFT issue lies in the compulsory minimum duration of a bid. Five minutes seems to long, but to even the playing field for those who can't trade in nano seconds, bids and offers should be forced to be left for around one minute, allowing them to to be filled by the majority of interested market watchers and not just machines.
on Sat, 07/31/2010 - 07:01
#497615
excellent invstigative bloggalism by the way :)
on Sat, 07/31/2010 - 07:50
#497647
I agree there needs to be a minimum bid duration, and also a minimum stock holding duration of at least 1 minute.
on Sat, 07/31/2010 - 09:02
#497703
Yes--either that or the sell side computers need to be at least as fast as the "bid" side (HFT) computers.
on Sat, 07/31/2010 - 10:49
#497785
@hooligan, hansel
5mins? 1min?
Ill try and be as objective as possible here... just so its clear, your argument is to have bids set that can't be cancelled for x amount of time.
There is no way in hell you could make a valid case for 1 min, 5min bids. Not even 10second bids.
Lets take the retail example of you entering a limit order for a stock that trades around $5 and you want to buy it at 4.90. Stock hovers around 4.9x and tries desperately to break 5. You dont get filled at 4.9 but youre at the top of the book on the 4.9 offer. Tries again at 5, and fails hard. All technicians see this as a failed breakout, and sellers step in. This is all happens within 2 minutes. Your 5min bid however is still valid for a while, and you inevitably get filled while it keeps dropping.
Now youre bagholder of a POS stock thats on its way to 4.xx and you didnt really want to get filled.
Also, books would be so cluttered level2 would have no meaning, this would increase latency with hundreds of TB of unnecessary packets further making high speed trading meaningless. And i dont mean HFT, but even retail 1second execution promises from brokers.
If you can make a case for 1minute bids other than i have, please do.
on Sat, 07/31/2010 - 15:03
#498075
How about 1/10 of a second or 1/100 of a second? I think slowing things down outside the range that HFT is designed for would work.
on Sat, 07/31/2010 - 15:35
#498098
In theory, yes we could have something there. Since HFT is measured in 1/1000s and anything over 10ms is considered 'slow', i suppose making a base where nothing can be faster than 1/100 would put a 'speed limit' on flashes and cancels from the time of origination.
Now the discussion lies in, how does one enforce this speed limit? We could say exchanges are bound by the SEC and CFTC to ensure nothing nothing is faster than x limit. But we all know how well enforced anything coming from the gov is. So that rules it out.
But, for argument, say said limit is imposed anyway. Riskless arbitrage opportunity would arise for the fastest trader (still staying within the confines and as class as possible to this 10 or 100ms limit. Eg: every time the /ES ticks up, which is in real time, one could potentially short that through the algo while lifting the offer on the SPY in anticipation of the tick higher. All of this done in less than a second, but within the time constraint. Since the MMs will notice the inefficiency, spreads would potentially widen to make out for the discrepancy existing in the marketplace.
on Sat, 07/31/2010 - 15:49
#498109
Even with these new opportunities for manipulation could there be any net benefit to the market from a 'speed limit' of whatever defined duration? Care to venture an opinion on where the 'sweet spot' might be?
on Sat, 07/31/2010 - 21:39
#498304
Im sure a programmer could give a better answer but from my point of view, any benefit would be either 1) short-lived or 2) very limited as to who enjoys the benefit (exactly as it is now with HFTs each competing to be better than the next).
Not everyone would have access to trade at speed limit levels - i suppose the greatest benefits would be (as usual) to the insiders and the big money. I suppose the sweet spot would exist in a market inefficiency which would, again, be short-lived (like the LTCM arbs, subprime bets - when people started piling into this is when they both collapsed) and only beneficial to a select few.
on Sun, 08/01/2010 - 07:06
#498429
The effort is worth it even as a theoretical discussion. Is the market going to slide into a feeding frenzy of well heeled insider banks? That is liable to have a bad outcome. Reform & taming the new technology needs to be done for the good of the country. This is an example of law needing to be steered by technological experts. There are many other examples outside of finance; oil drilling, frankenfood, the Internet just to name a few.
on Sat, 07/31/2010 - 16:22
#498135
You know I had a thought about enforcing a 'speed limit'. What you would need is a faster computer than they have, right. No problemo, the military has computers like you wouldn't believe & like it or not this is a national security issue. Install one of their more obsolete supercomputers to run interference, program it to be the cop on the beat & presto the 'speed limit' is enforced. Have truly draconian laws about trying to get a faster computer than the 'cop on the beat' computer (easy to detect an attempt & where they live) & no more HFT trading.
on Sat, 07/31/2010 - 15:07
#498080
0Power: Can they track trade origin of trade and cancellations? Then build stats on who is running the fraud. You know, like they run stats on naked shorts. </snark>
- Ned
on Sat, 07/31/2010 - 15:42
#498103
Yes take a look into NASDAQ TRF (not just nasdaq-listed). I just dont see anyone building a new database of every single order sent/cancelled/hit to the exchange, unless it would be a government-required exchange-wide process which encompasses every single item the agency asks them for.
Quick reminder on naked shorting from the SEC: "Naked short selling is not necessarily a violation of the federal securities laws or the Commission's rules. Indeed, in certain circumstances, naked short selling contributes to market liquidity."
on Sat, 07/31/2010 - 16:27
#498141
That is truly sick. SHORT SELLING has a place. Naked short selling is obvious fraud. I would at least expect SEC to whimper a bit. Should have been outlawed long ago.
on Sat, 07/31/2010 - 17:35
#498183
sorry, I had to go to the loo...
but I'm back now, with dry eyes and ..
Indeed, fraud is OK in certain circumsatances. Got it.
Dontch'a know.
- Ned
on Sat, 07/31/2010 - 19:24
#498184
sorry, dp in the loo.
- Ned
on Sat, 07/31/2010 - 07:00
#497614
There's manipulation and then there's this which falls into a new category of criminality. The SEC and the exchanges really don't have a clue.
My compliments to this investigative piece. I hope this gets disseminated far and wide.
on Sat, 07/31/2010 - 07:02
#497616
I dont think the HF boys are running PPTs erands, its just the screwed up factor that playing the market predominatly upwards they will never be stopped out. I.e when there has been freefalls in SP and NQ CME has removed the bottom 6 points on a number of occations, thus leaving these guys long shares but no hedge in the futures. Have you ever heard that they have cancelled trades in a short squeeze, nah, thought so. I also think a lot of HF algos got utterly fucked 6th of May, the elasticity in DAX and Eurostoxx has drasticlly gone down in European evening trading, from earlier showing 1.+ something Beta correlation on the SP its now way down. Dont have any data but I would assume the volume has decreased a lot since beginning of may during European night shift.
They just prefer playing the upside as its much safer for them, how many hearings didnt these guys had to go to after the flash crash? A 400 point short squeeze they will be padded on the back instead. I'm sure they could orchester a flash crash scenario every week if they wanted, but that would be illegal in the authorities eyes as well as it questions Benrons system.
But they will be screwed over again, dont think they have been able to computerize black swan scenarios in the algos. Also the immense competion will squeeze down there margins abruptly and when all retail suckers are gone there is nothing left to share.
on Sat, 07/31/2010 - 07:11
#497622
When I was an OTC wholesale energy broker way back in 1999 we called it cuffing a bid or offer. It was a fairly rare practice due to the risk of possibly getting done and then having to find someone quickly to take the other side (we were true brokers, not traders).
Now the whole practice seems to have gone mainstream at the speed of light. And the perps wonder why volatility went up instead of down? Go figure.
I wonder how many small investors and 401k participants realize that, thanks to these behind-the-curtain changes in market structure, their game has gone from something like hopscotch to something like the obstacle course on the hit show Wipeout. I wonder how many of their fund managers, brokers, and financial advisors have told them about it.
“Come on, take charge of your financial future, you can do it. Pay no attention to what’s going on in the backfield. Just keep your eyes on the cheerleaders and the scoreboard. Give me a T, R, A, D, E, what’s that spell….what’s that spell…..what’s that spell.”
P.S. I'm glad ZH only requires an understanding of basic math to post instead of these algos.
on Sat, 07/31/2010 - 22:07
#498322
" I wonder how many small investors and 401k participants realize that, thanks to these behind-the-curtain changes in market structure, their game has gone from something like hopscotch to something like the obstacle course on the hit show Wipeout. I wonder how many of their fund managers, brokers, and financial advisors have told them about it."
Oh, that is rich. (my first snark)
on Sat, 07/31/2010 - 07:14
#497625
My God, even HFTs have become addicted to crack and crystal meth. They are all over the place with these patterns.
We can only counteract this hyperactive frenzy with large doses of ritalin and percodans, which will allow everyone to do nothing and defeat the beast that thrives on players playing.
Even 20-30 percent carbon players allow game on. Perhaps getting it down to 10% and they'll tear each other apart for HFT crash 2- the sequel.
on Sat, 07/31/2010 - 11:56
#497848
..and obsessive-compulsive disorder is a helluva drug...
on Sat, 07/31/2010 - 07:26
#497630
On the overnight /ES, especially around 1am New York time when the action slows down, you see really weird action, huge orders that jump about at different prices. On days when you get the upward creep as in 2009, you see more sell orders than buy in volume terms, sometimes 4 times more volume on sell side, yet the /ES keeps creeping up. After watching this for over a year, I am quite convinced these algos work quite well in pushing prices in their "intended" direction. Denninger's recent post is way behind time, it has been happening over 12 months at least.
on Sat, 07/31/2010 - 07:41
#497640
You can also note the position of the Minis 30m MACD coming into the opening. They tend to cycle it to a low bull cross at or near the open thus providing an oversold momo builder to get the day off to a good start. Call it morning market caffeine.
on Sat, 07/31/2010 - 07:47
#497643
"It's Not A Market, It's An HFT 'Crop Circle' Crime Scene"
Man, that's so funny and so perfect. I almost choked to death on my coffee. What a way to wake up (yeah I know, I need to get a life...it's practically August here...)
Seriously, I've been waiting for someone to do something graphically with this data although I was thinking more along the lines of the Mandelbrot set (lots of numbers, cycles, repetitions) than crop circles. This is pretty amazing though; ghost in the machine indeed. Despite the mandate for stealth I'd be surprised if some HFT programer hasn't tried to paint recognizable or signature silhouettes with an algo's bid/offer patterns. At some level all guys like to piss their name in the snow.
on Sat, 07/31/2010 - 22:10
#498324
"At some level all guys like to piss their name in the snow."
Yes.
on Sat, 07/31/2010 - 07:47
#497644
It this is really occurring, and the charts do indicate that it is, the it is time for a real honest to God "Project Mayhem".
This is the same type of market manipulation that occurred at Enron with the California power problem.
They need their houses literally "burned down".
Hello SEC??? If the SEC is not going to take care of the problem does it now fall to our shoulders?
on Sat, 07/31/2010 - 08:13
#497658
Yeah although Enron (I'm talking only in regards to the Cal. electricity market here) was mostly gaming the stupid and unrealistic rules the government set up - which makes it harder for me to be outraged by it.
To the extent that this kind of HFT craziness is legal a similar situation exists here (although I am outraged by the SEC). The current state of market structure makes this kind of thing inevitable and clearly it needs to be totally revamped. At least some of it is the unintended consequence of a decades long regulatory push for cheaper and faster everything all the time which means the solution probably lies in forcing slowness and simplicity.
on Sat, 07/31/2010 - 08:42
#497688
didn't the building housing all the enron documents fall down on 9/11? oops, should watch what i say.
on Sat, 07/31/2010 - 07:48
#497645
checked the Nanex company profile...the 3 people listed there do not seem to have a PhD...can i trust this analysis?
on Sat, 07/31/2010 - 10:49
#497786
absolutely not. only trust those who have PhDs from harvard or princeton.
on Sat, 07/31/2010 - 07:53
#497649
Fascinating! No wonder I can't begin to count Elliott Waves.
I am wondering, because there is obvious collusion between the government and the country's TBTF banks, whether there is actually an issue of national defense at work here. Suppose that hackers in Russia or China have developed their own versions of HFT and are applying them in US capital markets in order to wreak chaos in the US. Would it then be "self defense" to prevent precipitous drops like Fat Finger Day? Small investors and retail traders would be nothing but spectators in this capital markets battlefield.
New topic of study for me: chart patterns of HFT algos.
on Sat, 07/31/2010 - 08:31
#497672
At some point they will claim this is done in the interests of national security. It is simply naive to believe these systems are not programed with a bias to the direction you want the market to move in. Programers are the new investment geniuses. I can't believe the mutual fund and pension fund industry is not up in arms about this. Rest assured that steps immediate agressive steps would be taken against the Russians and Chinese, but only when they start doing it for profit and reducing the profits of the Goldmans, Citadels, et al.
on Sat, 07/31/2010 - 07:55
#497650
is this shit only going on the US or also on other exchanges like in Europe??
Anybody
?