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Liquidnet Lays Off 12% Of Workforce As Plunge In Stock Trading Volumes Now Causing Widespread Pain

Tyler Durden's picture




 

The plunge in stock trading volumes is starting to cause real pain not only for the traditional exchanges and broker dealers. Bloomberg reports that one of the world's largest dark pool/block-trading brokers, Liquidnet, has just announced a 12% reduction in its workforce, letting 45 employees go. In a business where trading volumes define the top line, not only are broker-dealers about to experience major losses, but independent brokerages, in both light and dark venues, will continue to shed workers as long as the investor (either institutional or retail) refuses to return to stocks. And as Nic Lenoir pointed out yesterday, this will not happen as long as there is no confidence in the market, and while the realization that the US economy has hit unprecedented ponzi status continues to penetrate an ever greater sample of the US investing population.

Liquidnet Holdings Inc., the trading platform used by institutions such as mutual funds to buy and sell large blocks of shares, eliminated 45 employees this week because of a slowdown in business.

The cuts were confirmed by Rich Myers, a spokesman for the New York-based company. Liquidnet had about 375 employees before the 12 percent reduction. The job cuts were companywide, effecting people in trading, technology and transaction processing, Myers said

Those curious to find out more about the plight of the block trading business in a world where the pursuit of ever small order sizes is now the norm, should read the following Traders Magazine analysis. Yet cutting to the chase, the equation is simple: no trust - no trades; no trades - no profit. Which means that those who actually are left to trade the market will continue to decline, as the primary source of market capital - the retail investor, can not be substituted with any number of HFT gimmicks and Fed interventions.

 

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Fri, 09/10/2010 - 12:04 | 574197 Rusty Shorts
Rusty Shorts's picture

"I think this is the great example of why so many pin their hopes on the "as-yet-unknown-future-technology-fix". We just pop together the as-yet-unknown free energy device into the as-yet-unknown spaceship and fly to the as-yet-unknown destination and *wham!* populate the galaxy."

 

 - TOD

Fri, 09/10/2010 - 12:17 | 574238 bronzie
bronzie's picture

"technology singularity" is the term you are looking for I believe

the idea is that we reach a point where we make a quantum leap forward in technology

the Pollyannas and hopium smokers of this world point to the singularity as the solution to whatever problem is being discussed: peak energy, peak potable water, etc

makes it hard to have an intelligent conversation with someone when they pull the singularity out of their ass

intelligent person: "we have reached the peak of oil production - look at the production rate over the last decade - it has increased very little in spite of repeated claims from the Saudis and others that they were about to increase production significantly - also, during this same time, the populations of the oil exporting countries have been raising their living standards and are now exporting less oil than they used to"

hopium smoker: "but after the singularity ..."

Fri, 09/10/2010 - 12:34 | 574274 Rusty Shorts
Rusty Shorts's picture

"Yup, and add to that the as-yet-unknown technologies to keep humans in suspended animation until they reach their destination X hundreds (or thousands) of light years away, without any malfunctions from equipment or software provided by the lowest cost bidder..."

 

 - TOD

Fri, 09/10/2010 - 13:53 | 574487 Pope Clement
Pope Clement's picture

Yeah I'm popping vitamins big time along with Kurzweil of 'The Singularity is Near' fame in the hope that if we can last until the singularity of ever more massive computational power biologically integrated with human intelligence brings forth a new renaissance and a Methusalen ZeroHedge timeline... - but seeing the way the newest supercomputers are being used for fascistic criminal advantage does give me pause and perhaps I should reconsider the sometimes exquisite pleasures of booze, broads and nihilism.

Fri, 09/10/2010 - 12:36 | 574278 grunion
grunion's picture

Since you have defined the future of "Technology Singularities", any other prognostications you care to "pull out your ass"? History be damned!

You sound as though you relish the destruction of the economy. If that is the case, then you are part of the problem.

All bitch, no juice.

Fri, 09/10/2010 - 12:50 | 574322 Clampit
Clampit's picture

Considering what many people call "the economy", particularly those on CNBC, I welcome armageddon. The centrally spawned, fed nourished, corporate borg governance is Too Bloated To Feed.

Fri, 09/10/2010 - 12:56 | 574331 pan-the-ist
pan-the-ist's picture

Reality:

Improved more efficient technology displaces jobs.

Labor moves where labor cost is cheapest.

The current form capitalism works by creating demand out of thin air for products that nobody needs.

All that is needed to survive is in great supply (including water and oil once they are priced correctly.)

The rug will be pulled out from below all of this when enough Americans are unemployed and unable to buy that shit they don't need and realize they don't have to.  Once that happens, the economy will explode and there will be no way back (in this generation.)

Fri, 09/10/2010 - 14:40 | 574670 ziggy59
ziggy59's picture

we can mostly credit Edward Bernays for Propaganda for buying crap we dont need.

 

 

Fri, 09/10/2010 - 18:58 | 575205 ZackLo
ZackLo's picture

I honestly wonder what freud thought of him...you don't fuck with the animal spirits.....

Fri, 09/10/2010 - 19:13 | 575228 StychoKiller
StychoKiller's picture

Go long Brawndo Inc!

Fri, 09/10/2010 - 12:29 | 574259 UninterestedObserver
UninterestedObserver's picture

Careful if you keep posting stuff like that you will be the new Czar of Hopium distribution for the administration

Fri, 09/10/2010 - 12:46 | 574313 SheepDog-One
SheepDog-One's picture

Yes, we have a miracle on the way to save us, no one has any idea what that is but certainly the biggest most important discovery/invention is waiting to bust out of nowhere and save us within days....YEA lets pin our existance on THAT!

Fri, 09/10/2010 - 21:55 | 575401 New_Meat
New_Meat's picture

yah, Rusty--there's a reason that the Wright Brothers beat Prof Langley (even tho he had no Econ PhD) to first flight.  Big bang vs. incremental experiment/improvement.  Kinda like my view on the fraud HFT pulsing the system.  I think that they are doing micro-experiments before they unload.  wtf do I know??

- Ned

Fri, 09/10/2010 - 12:07 | 574204 NOTW777
NOTW777's picture

how many jobs left @ mutual funds?

what about brokers?

Fri, 09/10/2010 - 12:10 | 574218 Id fight Gandhi
Id fight Gandhi's picture

Still too many

Fri, 09/10/2010 - 12:07 | 574206 bronzie
bronzie's picture

nothing constructive to say so I'll just reiterate what I've been saying for years

"stocks are for suckers!!!"

Fri, 09/10/2010 - 12:15 | 574231 RockyRacoon
RockyRacoon's picture

What's not constructive about that?

Fri, 09/10/2010 - 12:08 | 574212 Racer
Racer's picture

Let them see what it is like to become one of the not counted unemployed!

Fri, 09/10/2010 - 12:11 | 574216 Pladizow
Pladizow's picture

Merideth Whitney says Wall St to lose 80,000 jobs in the next few months.

 

http://blogs.wsj.com/marketbeat/2010/09/08/meredith-whitney-wall-street-to-axe-80000-jobs/

Fri, 09/10/2010 - 13:39 | 574453 Running on Empty
Running on Empty's picture

Reminds me of the Lawyer joke about a million lawyers at the bottom of the ocean. Ah never mind.....

Fri, 09/10/2010 - 21:56 | 575404 New_Meat
New_Meat's picture

ok--just a good start. - Ned

Fri, 09/10/2010 - 12:13 | 574219 doomandbloom
doomandbloom's picture

Leo does not like the word plunge....

 

Sat, 09/11/2010 - 19:25 | 576123 RockyRacoon
RockyRacoon's picture

...unless it's followed by "neckline".

Fri, 09/10/2010 - 12:12 | 574221 Calculated_Risk
Calculated_Risk's picture

I will not return until the swamp is drained, and the thieves are in prison.

 

Probably won't happen in my lifetime, but I'm fine with that. I will teach my children the ways of these thieving leeches... so as to further cut off the income to these thieving whores.

 

 

Fri, 09/10/2010 - 12:15 | 574229 Racer
Racer's picture

Exactly!

They expect the ordinary person to throw even more money at the greedy rats, ...sorry rats, I didn't mean to compare you to banksters.

Fri, 09/10/2010 - 12:44 | 574308 sunny
sunny's picture

Teach your kids quickly, time might be running out faster than you have anticipated. 

http://www.marketwatch.com/story/forget-going-green-earth-doesnt-care-2010-09-07?pagenumber=1

I keep looking for a hole in this argument, some scenario that will make the suggested future Farrell outlines look survivable.  I can't come up with one.

Party on.

sunny

Fri, 09/10/2010 - 13:01 | 574343 Eternal Student
Eternal Student's picture

Thanks for the link. I'm surprised to see that on the MSM, and clearly missed it. Must've been downplayed quickly.

Fri, 09/10/2010 - 12:46 | 574312 American Dreams
American Dreams's picture

This is what MUST be done and CR you are not alone.  I have already started teaching my children (ages 9 and 11) how to fight this war.  Its been on for almost 100 years and it will likely take that long to win back what has already been lost.  Freedom...

 

know your enemy

Fri, 09/10/2010 - 21:57 | 575406 New_Meat
New_Meat's picture

get the Griffith translation--his PhD. thesis after he sacrificed himself in '47. - Ned

Fri, 09/10/2010 - 12:12 | 574222 williambanzai7
williambanzai7's picture

Liquidnet, what a sham concept.

Pools for fools.

Fri, 09/10/2010 - 13:37 | 574452 ZeroPower
ZeroPower's picture

Are you saying the name is mis representative of its function?

Fri, 09/10/2010 - 12:19 | 574246 liberal sodomy
liberal sodomy's picture

They can work fixing the roads on one of barry's 6 year plan chain gangs.

Fri, 09/10/2010 - 19:38 | 575260 ATTILA THE WIMP
ATTILA THE WIMP's picture

Can I have a job guarding them with a shotgun? If so will I have to pay my own (very high) ammo bill?

Fri, 09/10/2010 - 12:19 | 574247 mark mchugh
mark mchugh's picture

Justice is the only thing that will ever restore confidence in the system.  It's hard to feel much sympathy for people who never stood up against the corruption in the system. 

Fri, 09/10/2010 - 14:07 | 574544 willien1derland
willien1derland's picture

+1000

Fri, 09/10/2010 - 14:40 | 574671 Rick64
Rick64's picture

+100

Fri, 09/10/2010 - 12:20 | 574249 bigdumbnugly
bigdumbnugly's picture

"they liquidated them ay?  very resourceful."

wizard of oz

Fri, 09/10/2010 - 12:21 | 574250 tony bonn
tony bonn's picture

it's heart warming to see leeches, parasites, and barnacles swirl down the drain but can't we destroy the real criminals like dimon, blankenfein, pandit and other scum?

Fri, 09/10/2010 - 12:23 | 574252 Dismal Scientist
Dismal Scientist's picture

OT, but too good not to share. At this rate, the GOP might not even be able to beat Barry in the midterms.

http://gawker.com/5634055/the-craziest-political-speech-youll-see-this-f...

Fri, 09/10/2010 - 12:27 | 574253 liberal sodomy
liberal sodomy's picture

Hey commie scum......head on over to Intrade.

Fri, 09/10/2010 - 13:13 | 574377 Dismal Scientist
Dismal Scientist's picture

You muppet. I detest all politicians equally. Finding a clip of someone losing it like that just makes me laugh.

Intrade indeed. Peasant.

Fri, 09/10/2010 - 12:50 | 574319 grunion
grunion's picture

I'd like to know more about the context under which this speech was delivered but in the absence of that information, I think I'll go with the previous response to your post. It reminds me of congressmen like Stuart Smalley and that "Death Committees" idiot (Fortunately his name escapes me but I think it was congressman Grey).

Dude, it is just the same old dribble and will change nothing. Keep hoping though and maybe your Fairy Godmother will rescue your corrupt, anachronistic give-away crowd of hucksters.

Fri, 09/10/2010 - 13:14 | 574379 Dismal Scientist
Dismal Scientist's picture

See my reply above. Minus the peasant part, since you managed not to be insulting for no reason.

Fri, 09/10/2010 - 13:48 | 574475 pan-the-ist
pan-the-ist's picture

There are currently many people who can do what you do for a living, most of which will be willing to do it for much less.  Welcome to the new normal, bitch.

Fri, 09/10/2010 - 14:32 | 574649 Dismal Scientist
Dismal Scientist's picture

If thats directed at me, you have taken my soubriquet too literally. If not directed at me, not sure who you're talking to.

Sat, 09/11/2010 - 11:51 | 575696 pan-the-ist
pan-the-ist's picture

I'm not sure who my comment was directed to. Doesn't make sense in this context.

Fri, 09/10/2010 - 12:50 | 574321 SheepDog-One
SheepDog-One's picture

Thats nothing, some lowly county treasurer? Just listen to Obamas whacked-out speech just from today! And in his adoring state of illinois, where he always had top approval numbers, its even dropped to solid negative approval now.

Fri, 09/10/2010 - 13:50 | 574479 pan-the-ist
pan-the-ist's picture

Does that give you a boner?

Fri, 09/10/2010 - 16:14 | 574915 Kali
Kali's picture

Hilarious!  And scary that this guy has been in politics for so long.  Who gave him his MA in communication?  The Glen Beck school of hysteria?

Fri, 09/10/2010 - 12:26 | 574257 UninterestedObserver
UninterestedObserver's picture

Laid off bitchez - sorry I couldn't help myself...

Fri, 09/10/2010 - 12:30 | 574261 HelluvaEngineer
HelluvaEngineer's picture

I was thinking "Funemployment, bitchez"

Fri, 09/10/2010 - 13:15 | 574383 pan-the-ist
pan-the-ist's picture

Laid off? Is anyone going to go back to buying stocks?  They lost a generation after the depression and they will again this time.

Fri, 09/10/2010 - 22:24 | 575434 Yer Dotter
Yer Dotter's picture

This time, it could be longer than a generation... With the internet, a lot of people are now understanding what has been going on for a long time.

Fri, 09/10/2010 - 12:30 | 574264 economicmorphine
economicmorphine's picture

King Midas, Eva Peron, Wall Street...it's always the same story.  I can't hardly wait until somebody's (somebody big, TARP big) trading account blows up.  Let me use small words so that Wall Street understands.........there isn't going to be a bailout this time, boyz.  

Sat, 09/11/2010 - 10:08 | 575656 MichaelG
MichaelG's picture

I hope you're right, but I bet you a quadrillion dollars you're not.

Fri, 09/10/2010 - 12:32 | 574270 Waterfallsparkles
Waterfallsparkles's picture

What I find amusing is that the Retail Invest cashed out at the top.  Not the bottom.  I think this has left Wall Street baffled as now they are the Bagholder and do not know what to do.  The only thing they are trying now is to squeeze the shorts to buy them out of their positions with the help of the FED of course.  Problem with that is that the Retail Trader is gone and they would be the ones that caved into that scheme.  The pros have enough resources to wait them out.

Fri, 09/10/2010 - 12:37 | 574282 Id fight Gandhi
Id fight Gandhi's picture

Good point. Good for them. Seeing the hedgies hurt is fun for a change. They keep feeding the long term hold lies to bring in the masses. Same goes for the real estate always goes up lies.

Where's the juice to push this turd any higher? Seems range locked.

Fri, 09/10/2010 - 12:43 | 574304 SheepDog-One
SheepDog-One's picture

I agree, from the start they thought they could run the biggest pump and dump ever, passing off the top of the pump to retail, but its not happening. Behind the scenes I sense they have NO clue what the hell to do and its now just 'pump today, maybe we'll figure out some new scheme by Monday', but for now theyre stuck holding the biggest bag in history.

Fri, 09/10/2010 - 13:39 | 574456 ZeroPower
ZeroPower's picture

Retail daytraders, sure, maybe theyre out thanks to omens, golden crosses, inverse H&S etc etc plethora you will find on here and other blogs telling you to get out.

But the retail 401k or non-daytrader who didnt want to earn zero in his savings account might still be waiting for the rise. I agree its a shame it won't come.

Fri, 09/10/2010 - 12:36 | 574279 LooseLee
LooseLee's picture

Let's hope this pattern continues (a melt-up if you like)...Couldn't happen to a nicer bunch of guys, ha ha!

Fri, 09/10/2010 - 12:39 | 574292 SheepDog-One
SheepDog-One's picture

Theyre truly damned if they do, damned if they dont, and I love it! Now we're supposed to feel sorry for the unemployment wave cresting on Wall St...enjoy it boyz! You made your bed, you lie in it.

Fri, 09/10/2010 - 12:36 | 574280 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

Too many investors chasing a lack of liquidity in the markets. The scam on Wall Street can only be perpetuated so long if no new funds flow into the market from the masses. No use playing a poker game if one player has all of the chips. Let the deflation black hole open up at the foot of the NYSE!

Fri, 09/10/2010 - 12:37 | 574285 SheepDog-One
SheepDog-One's picture

AW thats a shame all the crooksters are being fired boo hoo hoo.

Fri, 09/10/2010 - 22:26 | 575436 Yer Dotter
Yer Dotter's picture

Exactly! Good riddance! And this is just the beginning.

Fri, 09/10/2010 - 12:37 | 574287 Segestan
Segestan's picture

 New members ?....of the.. lazy Fat Pig society.... only existing on the backs of --working-- tax payers. Doesn't matter that these people payed into the system, I don't want to hear it...  only matter's now that they are in need,,, screw them!!! They are destroying our economy..

 

Fri, 09/10/2010 - 12:51 | 574324 SheepDog-One
SheepDog-One's picture

6 year Musolinni plan to work on the railroad chaingang all the livelong day!! We are saved! WOOT!!

Fri, 09/10/2010 - 14:10 | 574552 willien1derland
willien1derland's picture

Dare it IS! (Sorry could not help myself!)

Fri, 09/10/2010 - 12:53 | 574325 RobotTrader
RobotTrader's picture

I mean really, can stock market sentiment be even worse?

The SPY should be at 800, not 1,100.

Seems to be shucking off the worst news ever.

Over 400 stocks on the NYSE now have a dividend yield of 4% or greater.  Sure beats 3.8% on the 30-yr. Treasuries.

I'm still long, not really seeing a whole lot of weakness right now, except maybe the SOX.

Fri, 09/10/2010 - 12:56 | 574330 SheepDog-One
SheepDog-One's picture

Wouldnt it be great if they pulled off another 9-11 over the weekend and all exchanges are wiped out, DOW opens at 2,000 Monday morning or even lower? Man that would be great, leaving all these idiot longs with their heads spinning 'DUH what happened boss? Technicals looked OK'! Such an event WILL happen one of these days, and there will be no warning given.

Fri, 09/10/2010 - 13:03 | 574348 Dr. No
Dr. No's picture

Is that really what you home for?  that is really sad.

Fri, 09/10/2010 - 13:55 | 574497 Red Neck Repugnicant
Red Neck Repugnicant's picture

You're wishing for another 9/11 attack?

What's wrong with you fucking people? 

There's so many of you around here dreaming for the stock market to crash, the dollar to collapse, treasuries to implode, and anarchy in our society. You're nothing but a bunch of GI Joe drama queens, trying to play out your Gunsmoke and Delta Force fantasies. 

Personally, I find no moral or ethical difference between those who fly 767's into skyscrapers and those who wish for the total destruction of our society. 

Go fuck yourselves.   

 

Fri, 09/10/2010 - 14:09 | 574543 homersimpson
homersimpson's picture

"There's so many of you around here dreaming for the stock market to crash".. um.. what's wrong with that in a rigged stock market?

"The dollar to collapse" - again - what's wrong with that, too? Makes gold even much more valuable..

"Treasuries to implode" - maybe the federal government would stop playing all these number games and start spending less so the US taxpayers dont' have to pay for their BS much longer.

"anarchy in our society" I've never seen anyone in here hoping for anarchy, but there are many on this board that think anarchy will kick in once the ponzi scheme around the world comes to a halt.

"You're nothing but a bunch of GI Joe drama queens" Given your previous postings, I don't think you're in any position to say that considering how often you've been junked when you post.

I think the extreme minority here wants a 9/11 repeat. However, the majority of people on ZH are realists - not people who buy into whatever Obama is saying for the past 2 years. The economy is being held up by taxpayer bucks, fraudulent accounting, and a few TRS-80s that manipulate the stock market at taxpayer expense.

So on that note - there's nothing wrong with trying to capitalize on financial fraud.

 

Fri, 09/10/2010 - 14:11 | 574553 homersimpson
homersimpson's picture

"Wouldnt it be great if they pulled off another 9-11 over the weekend" Sorry man - can't side with you there. I wish they never pulled off the first one.. life has been much different since then.

Fri, 09/10/2010 - 19:34 | 575254 StychoKiller
StychoKiller's picture

After seeing what the current adminstration is doing to the World Economy (flash crash, etc), I'm beginning to think that Al Qaeda was justified.

Fri, 09/10/2010 - 12:58 | 574335 Dr. No
Dr. No's picture

I hear about these stories and it makes me sad for the people.  But it makes me wonder if the division of labor is just too great?  These people were layed off from a position which supported buying and selling of digital money with digital stocks.  Most of the trades are done by HFT now.  A lot of the layed off workers will go home and still buy take out food and pay to get their oil changed because we dont know another way.

Fri, 09/10/2010 - 13:08 | 574365 crosey
crosey's picture

If dinosaurs talked, they'd exclaim, "We never saw the asteroid coming!"

Fri, 09/10/2010 - 13:15 | 574384 NumberNone
NumberNone's picture

Just more time to play tennis in Central Park, take leisurely lunches, visit their children's schools,work out at the gym, and five mile walks to cross the Brooklyn Bridge to try Grimaldi's pizza.

Fri, 09/10/2010 - 13:23 | 574413 Blues Traveler
Blues Traveler's picture

Amen Brother, Justice is the foundation of Confidence...

Fri, 09/10/2010 - 14:31 | 574645 omi
omi's picture

Low interest rates hurt technology companies too ;p

 

This business will be more profitable in a few years after a massive exodus from bonds. Asset purchasing works a bit differently for bonds than for equities

Fri, 09/10/2010 - 19:00 | 575207 PrDtR
PrDtR's picture

What can be done to curb HFT?  REALISM!  1 sec time, no sub- $0.01 trading..

 http://www.ft.com/cms/s/0/d72966fa-bc2d-11df-8c02-00144feab49a.html?ftcamp=rss 

 

Fri, 09/10/2010 - 19:35 | 575256 StychoKiller
StychoKiller's picture

Charge 2Cents for every cancelled quote also.

Sat, 09/11/2010 - 04:54 | 575589 MrTrader
MrTrader's picture

I am recalling Deutsche Bank and others scrambling to strenghten their commodity desks at the peak of the commodity boom. Now, using this observation as a contra-indicator, we will see these people hired again in let´s say 4 month ? :=)

Sat, 09/11/2010 - 07:03 | 575605 sarnuk
sarnuk's picture

Liquidnet is a great product. I am sad that they had to lay off good folks. Their business model leads so many of the other dark pools by leaps and bounds. Seth is innovative, and has brought great positives to the investing world in terms of technological tools to execute efficiently. If he had to lay off it says something about the state of the rest of 'em.

 

Hope you guys laid off land quickly.

 

Sal

Tue, 09/28/2010 - 03:07 | 609308 Herry12
Herry12's picture

Thank u, i found this for a long time.
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