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Michael Hudson: Average Stock Held for 22 Seconds and Average Foreign Currency Position Held for 30 Seconds

George Washington's picture





 

Washington’s Blog

Michael Hudson is a highly-regarded economist. He is a Distinguished
Research Professor at the University of Missouri, Kansas City, who has
advised the U.S., Canadian, Mexican and Latvian governments as well as
the United Nations Institute for Training and Research. He is a
former Wall Street economist at Chase Manhattan Bank who also helped
establish the world’s first sovereign debt fund.

Yesterday, Hudson said:

Take any stock in the United States. The average time in which you hold a stock is--it's gone up from 20 seconds to 22 seconds
in the last year. Most trades are computerized. Most trades are
short-term. The average foreign currency investment lasts--it's up now
to 30 seconds, up from 28 seconds last month.

See also this and this.

 


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Mon, 01/03/2011 - 17:06 | Link to Comment the rookie cynic
the rookie cynic's picture

The robot traders suffer from premature speculation I guess.

Mon, 01/03/2011 - 16:22 | Link to Comment mark mchugh
mark mchugh's picture

That Hudson clip is great!  Thanks GW.

Mon, 01/03/2011 - 15:07 | Link to Comment bull-market_3.0
bull-market_3.0's picture

I think what might be more interesting would be a measure of the average duration of trades for non-computerized investments. At least that way, we can see the average duration of human trades

Mon, 01/03/2011 - 14:54 | Link to Comment Stuck on Zero
Stuck on Zero's picture

Wow!  At that rate a Tobin tax on stock transactions would eliminate the national debt in about a day!

Mon, 01/03/2011 - 16:13 | Link to Comment mark mchugh
mark mchugh's picture

Right on!  Think they'll do it?

Mon, 01/03/2011 - 14:36 | Link to Comment Salinger
Salinger's picture

but the hedgies live large, there's no denying that, among other things they're scooping up prime real estate at bargain prices from the timid who lost big in the past couple of years - I wonder if Rosie ever bought or if he still rents in Toronto, if  he gets the pink slip later this year his house would have appreciated by some 20% but my guess is he has been renting

Mon, 01/03/2011 - 14:16 | Link to Comment Dr. Gonzo
Dr. Gonzo's picture

"I live for my dreams...and a pocket full of gold."

Led Zeplin (1973)

Mon, 01/03/2011 - 14:16 | Link to Comment Dr. Gonzo
Dr. Gonzo's picture

I sold my IRA rollover. Paid the taxes. Paid off my mortgage. I sold my Roth IRA contributions to buy silver. Left all the chedder in from my Roth IRA big copper minning plays before the 08 blow-up and last year moved most to PSLV. All the free money I have now i buy coins. I just don't care. Paper money is fake. The stock market is rigged and manipulated. I don't want any part of it. I did well but for me it's not about winning. It's about living your life and protesting the machine. Remember. You can die with 10 million in a bank account or you can die with 10 thousand oz of silver/gold. Either way we all die. 

Mon, 01/03/2011 - 14:12 | Link to Comment Drag Racer
Drag Racer's picture

At least they don't charge you to make a bet in Vegas...

Mon, 01/03/2011 - 14:58 | Link to Comment johnnynaps
johnnynaps's picture

+100000! I am more profitable in Atlantic City then in Wall Street due to fees and taxes! What a joke!

Mon, 01/03/2011 - 13:28 | Link to Comment Apostate
Apostate's picture

What would the market look like if we had a free choice in which exchanges to use?

The markets are no more free than the airline industry.

Mon, 01/03/2011 - 14:06 | Link to Comment Temporalist
Temporalist's picture

I disagree; the markets are free to be manipulated.

Mon, 01/03/2011 - 13:26 | Link to Comment What_Me_Worry
What_Me_Worry's picture

22 seconds?  I'll take the under for 2011.

Mon, 01/03/2011 - 13:37 | Link to Comment TruthInSunshine
TruthInSunshine's picture

Time is on my side, yes, it is.
Time is on my side, yes, it is.
Now you were saying that you want to be free
but you'll come runnin' back, you'll come runnin' back,
you'll come runnin' back to me.

- Lyrics & Song by the HFTbots & The Algos.

Mon, 01/03/2011 - 13:18 | Link to Comment Bearster
Bearster's picture

Dumb question: how does one make such an "unfree" market "freer"?  By forcing people to hold positions for longer?

How about:

 - end the Fed

 - allow people to choose gold or whatever they want for money

 - end bailouts / TBTF / FDIC / etc.

 - end Donk, Sarbox, SEC, CFTC, OTC, OTS, etc.

 - no more stimulus

 - end FLA, minimum wage, and other price controls

And see where the chips end up.

 

Mon, 01/03/2011 - 14:48 | Link to Comment Spaceman Spiff
Spaceman Spiff's picture

Good list...    

I'd also scale down some regulatory laws (osha, epa, etc).  

On the state/local levels, we need some sanity to the permitting process and local bureaucracies.    

tort reforms

Make sure the process for licensing professions is 1)  reasonable  (do we need cosmetology licenses in some states...  are the tests an appropriate reflection of what is needed to practice) 2) transparent and appealable (make sure they release questions and they are fair)  3)  fight against protectionism by those already licensed  (i've heard that some cpa tests have 50% pass rates.   california's bar passage is the same.)  

Mon, 01/03/2011 - 17:09 | Link to Comment FatFingered
FatFingered's picture

Florida State General Contractor's test has an admitted targeted 70% failure rate. 

Mon, 01/03/2011 - 14:42 | Link to Comment NotApplicable
NotApplicable's picture

Dumb question: how does one make such an "unfree" market "freer"?

Paint it black!

Mon, 01/03/2011 - 13:33 | Link to Comment Tell me lies
Tell me lies's picture

I guess I shoud have asked is pension money being churned this way?

Mon, 01/03/2011 - 14:01 | Link to Comment kaiserhoff
kaiserhoff's picture

Probably not.  You have to be a broker/dealer with zero commissions or better yet, getting paid for order flow, for this to work.  On the other hand, pension money is funneling into cotton, crude oil, and Chinese solars.  Why does that not fill my heart with everlasting joy?

Mon, 01/03/2011 - 13:11 | Link to Comment Tell me lies
Tell me lies's picture

Dumb question, how does that work with pension funds?

Mon, 01/03/2011 - 13:02 | Link to Comment Racer
Racer's picture

If the average holding is for not even half a minute then it really proves without doubt that this is not a 'stock' market... it is purely a casino that is totally rigged in favour of the banksters.

All I can say is well done to those people who are pulling their money out of this scam.

Mon, 01/03/2011 - 12:58 | Link to Comment Don Birnam
Don Birnam's picture

Ah, too funny indeed -- and in the left margin of this article, as of this writing, "Trade like a pro. Get Jim Cramer's Action Alerts Plus !"

Mon, 01/03/2011 - 12:58 | Link to Comment NotApplicable
NotApplicable's picture

Wow, 22 seconds is forever to an HFTbot. I'm shocked that the number is even in double-digits, let alone over twice that.

Must be all of those widow and orphan funds raising the average.

Mon, 01/03/2011 - 15:22 | Link to Comment FinancialAnon
FinancialAnon's picture

skewness bitchez

Mon, 01/03/2011 - 13:03 | Link to Comment Azannoth
Azannoth's picture

I think this number includes human traders

Mon, 01/03/2011 - 14:40 | Link to Comment NotApplicable
NotApplicable's picture

And all of my leftover tech-wreck stocks sitting in a dead IRA. They may be only worth a few pennies, but at least they add value to the averages.

Mon, 01/03/2011 - 14:10 | Link to Comment Drag Racer
Mon, 01/03/2011 - 12:52 | Link to Comment topcallingtroll
topcallingtroll's picture

I guess being a swing trader qualifies as buy and hold now. I am holding my positions too long!

Mon, 01/03/2011 - 16:09 | Link to Comment midtowng
midtowng's picture

Buy and Hold, bitchez!

Mon, 01/03/2011 - 12:51 | Link to Comment AchtungAffen
AchtungAffen's picture

The freedom in free market is quite Sartrian...

Mon, 01/03/2011 - 16:27 | Link to Comment covert
covert's picture

I wish that I would have been a broker. all this churning. have a drink at the new bar in town with the movie stars.

http://covert2.wordpress.com

 

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