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It's Time The US Gov't Finds Out How Loyal A Hungry Dog Really Is

CalibratedConfidence's picture




 

Tabb Forum released a video today focusing on order-types in relation to HFT.  Tabb's research director highlights that regulators are still unsure about what to do with HFT

 

Perhaps it's time we do what is in our power to help our "elected representatives" better understand HFT.  There are three key publications we can tap into that are recent and have been praised for their accurate depiction of today's markets, one of which has its foreword written by former Senator Ted Kaufman:
Personally, I will be sending a copy of each with a lengthy personal letter addressed to my reps.  If you are feeling as frustrated as many of us are perhaps you will do the same. Each publication is loaded with accurate material, each covers its own separate and specialized topic, they're cheap enough to spare the coin for, and structured in a way that if Congress and the US Senators read them they will have a broad understanding of this fragment market.  There has been more moderated forums & discussions on HFT in the private arena than in the public one which is problematic because regulations are not passed through the private sector.   

There is reason for concern among us as our questions constantly go unanswered by regulators and our observations discounted because of others inability to understand complex relationships.  Like many of the topics covered around the world, this is a battle of information.  Zerohedge's mission statement demands us to facilitate information's unending quest for freedom and to liberate opressed knowledge.  Many of us go beyond just writing and we are asking for your help to organize a movement for financial reform and to help us reach Senators and Congressmen that are beyond our geographic location, as the probability of one of them pretending to listen improves if you're a constituent. 

The main focus here should be the exchanges transparency (which is an apparent oxymoron as those schleps don't even know what is going on) when it comes to order types along with the speed at which multiple data feeds are updated.  Couple that mess with media outlets feeding data to premium subscribers and you have a market heavily slanted to the negative side.  All this mixed in with special order types designed to skirt the accepted rules of the game and we have a untrusted, broken market in the pot.

The Importance of Order Type & Special Feature Transparency by calibrateconfidence


And now it's on us to mobilize and make sure at least one of us in each district contacts our representatives and do what we can to inform them of the state our financial markets are in.  These are not topics we would expect them to understand given the esoteric realm in which it exists in relation to the world a DC politician lives within.  The longer this goes on, the more bad algo's will manipulate the system and rig profits in their favor, skirting the very laws that wind up resulting in those goddamn FINRA bans for the human traders without the deep unethical pockets like their bad algo competitors.  All this will continue while the SEC burns millions on chasing down Stevie C under the direction of the Mary Jo White, Tabbi's Fox in the Hen House.

Hold Brothers own boss decided to fund and operate an inside spoofing strategy through Holds own Grey Box shitware and guess what?  They are still operating as a broker/dealer, paid a $5.9MN fine, and make sure to hid their tracks better going forward.  We have ample evidence of the magnitude of the frauds being perpetrated given the new dynamics of our exchanges.  A few quotes I noted last week in The Problem of HFT:


The benefit of speed
The truth about the technological arms race was that, although speed mattered, you could only reap the benefits if you knew what special order type to send and when to send
The benefit of converting another traders order
unfair conversion of investor orders eligible for maker rebates into unfavorable executions incurring taker fees
How beholden we are to trust any of the given exchanges transparency
The more one studies the exchange documentation, in fact, the more apparent is our dependency on the discretion of the exchanges to inform individual customers of the features that have material impact on execution performance and the intended usage scenarios of such features
If you agree with us on the need for financial market reform, collect those three books and write a letter to your representative addressing the problems you see that go beyond the day traders and hit on market structure, participant integrity, following the laws already passed, and having a regulator enforce the rules it has in place. 
  
 

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Wed, 01/30/2013 - 12:08 | 3199030 nofluer
nofluer's picture

Called my Rep's office and asked for the "economics guy." Asked him what he knew about "HFT - high frequency trading". He'd never heard of it. I gave him a brief statement, Said that about 50% of the trades these days are HFT, that they happen in seconds, and scads of money are stolen through them by the TBTF banks & etc. and that HFT is completely unregulated.

He sounded half asleep. I have doubts that he will "look in to it" as stated.

Wed, 01/30/2013 - 16:28 | 3200060 CalibratedConfidence
CalibratedConfidence's picture

that's why they need the books.  get them caught up.  thanks for getting involved.

Wed, 01/30/2013 - 11:42 | 3198915 Vooter
Vooter's picture

"Personally, I will be sending a copy of each with a lengthy personal letter addressed to my reps.  If you are feeling as frustrated as many of us are perhaps you will do the same."

Oh, right...your "reps." LOLOLOLOLOLOL!!! Are you retarded?

Wed, 01/30/2013 - 12:06 | 3199014 CalibratedConfidence
CalibratedConfidence's picture

No, I'm not.  You got a better idea you care share? 

Wed, 01/30/2013 - 13:17 | 3199253 Vooter
Vooter's picture

NOT interacting with your "reps," for starters...

Wed, 01/30/2013 - 18:38 | 3200055 CalibratedConfidence
CalibratedConfidence's picture

Any constructive ideas that involve action and not doing nothing?

Wed, 01/30/2013 - 10:42 | 3198612 Melin
Melin's picture

Let's all try to get more regulators into the market? 

Let's get them all out of the market and let freedom have a chance.  Free individuals would set up private exchanges that cater to the style of trading people enjoy.  Good, good.

 

 

Wed, 01/30/2013 - 09:03 | 3198212 Stud Duck
Stud Duck's picture

My newly elected Congress womans family  had recieved $700,000 in farm subsidies before she was elected. I get her weekly newsletter via email. She is so intralled with supporting the Military (she has a airbase and a Army base in her district). Between her farm lobby and her military lobby the common person has no chance of getting through to her.

I went to one of her community meetings that was close a few years ago. A college prof stood up in the meeting and started to rave on her record for the farm subsidies, a dozen cops showed to calm the croud.

What was really interesting was that she had NO security, none.  I went to the parking lot to observe her exit, Wow, I wonder when these people realize that the will become targets when the SHTF.

No matter, moving to Colorado, grow mary jane, and forget about the rest of the peoples problems. Did the calculations, 1 acre of MJ producing 1/4 lbs each plant (3 sf per plant) produces 3,500 lbs @ $1,000 per lb totals $3.5 million. It is a no brainer! The rest of you can whine, stomp you feet like little girls, or do the oh poor me, Smart people are trying to do someting about their circumstances!

Wed, 01/30/2013 - 14:37 | 3199523 AvoidingTaxation
AvoidingTaxation's picture

You can make more than 1/4 lbs each plant

Wed, 01/30/2013 - 11:58 | 3198987 Lordflin
Lordflin's picture

Yeah... You are the smart one, anyone can see that...

Government will fix the markets, just give them the chance... After all... The CFTC finally launched an investigation into silver trades.

Wed, 01/30/2013 - 08:28 | 3198171 WTFUD
WTFUD's picture

Fine article!
If every elected snake in both houses, SEC, or Any other responsible parasite in the loop decided to address this issue in BLOOD it would be of Zero interest to me and hopefully 99% of the folks here at Z/H.
Lets be serious there are 99 ways to skin a cat and Any Mark voluntarily participating in Fantasy Island deserves what's coming to them

Wed, 01/30/2013 - 08:26 | 3198166 overmedicatedun...
overmedicatedundersexed's picture

if you are disgusted and still registered D OR R, you are fools, for once get up and change your registration to a third party or indie, not hard but it will send a message better than calling a pimple faced intern in your reps office.

Wed, 01/30/2013 - 11:44 | 3198925 Vooter
Vooter's picture

If you're still "voting" you're a fool...

Wed, 01/30/2013 - 08:26 | 3198164 Downtoolong
Downtoolong's picture

Self-Regulating industry my ass.

I'll send in a letter. But, the real crime is that 50,000 letters from concerned investors gets weighed against one “fagetaboutit” from Lloyd Blankfein. Guess which way Chuck Schumer tilts?

Wed, 01/30/2013 - 08:14 | 3198152 fijisailor
fijisailor's picture

Legislators will never understand the things they are paid not to understand.

Wed, 01/30/2013 - 07:58 | 3198128 max2205
max2205's picture

And ask for some money back

Wed, 01/30/2013 - 06:52 | 3198086 negative rates
negative rates's picture

It doesn't matter what you send them, they can't understand it, they can't even agree to simplify the tax codes and do their own taxes. Our representitives are less intelligent and more power hungry than than a large percentage of our population. They will only resent the dog sent to teach them the lesson of being humane, I personally can't wait to see them expode. 

Wed, 01/30/2013 - 11:27 | 3198843 tango
tango's picture

My response to that is, "So why not run yourself or support someone with like views?"  The dirty little secret is that our DC politicians are not outliers,  They are not so differe=nt than you and me.  They lived next to us, went to the same schools and churches, had similar careers (doctor, farmer, soldier, businessman, lawyer), watched the same shows, etc. The trouble is that DC changes attitudes, convinces them that they are indispensable and knowledgable.  When they quit the most common reason cited is weariness at tilting at the windmills - nothing gets done (tax codes) and it seems nothing will get done. 

Wed, 01/30/2013 - 06:02 | 3198064 CompassionateFascist
CompassionateFascist's picture

@ testosteronepit: All the pols in Sodom-on-the-Potomac are owned by a kosher mafia who control their

 

1) campaign finance

2) media acess

3) inside-traded "investments" by which most swiftly become multi-millionaires

 

they do not care what you or I think

Wed, 01/30/2013 - 04:12 | 3198021 dunce
dunce's picture

There seem to be a limited number of form letters, because i had the same experience of getting a reply that seemed like it might have been from a computer that was programed to select replies based on key words. There was no doubt that senator high and mighty never saw my letter or any letter that did not involve campaign contributions. I was upset that no matter what state i traveled through there was a law firm that specialized in getting people approved for disability. Obviously the bureaucrats were not doing their job in evaluating claims if law firms in every state could make big money assisting claimants. That was 6 or 8 years ago. Obama has solved the problem by approving all claims.

Wed, 01/30/2013 - 01:53 | 3197918 q99x2
q99x2's picture

Time for the return of the Magnificent 7.

Wed, 01/30/2013 - 02:18 | 3197932 Manthong
Manthong's picture

Likely, it's more a job for the Dirty Dozen.

Wed, 01/30/2013 - 07:06 | 3198096 BeetleBailey
BeetleBailey's picture

..that or The Wild Bunch....Holden would be shooting constantly.

Wed, 01/30/2013 - 01:13 | 3197853 Joe moneybags
Joe moneybags's picture

Unlike the broad public protest against TARP, this time our reps will listen!

Wed, 01/30/2013 - 02:35 | 3197949 kliguy38
kliguy38's picture

"Trust us.....we're from the gubernment...we're here to help you" ......"This here high frequency cheating chit has ta stop"...."I mean it...we will put and end to this cheatin' the little guy" ......("How'd that sound Mr. Blankfein?")

Wed, 01/30/2013 - 01:01 | 3197823 rustymason
rustymason's picture

I used to call my reps but the snotty little shits on the other end of the phone obviously never delivered any of my messages.  I used to write but all I got back were form letters about different issues. Total waste of time. Your results may vary.

Wed, 01/30/2013 - 10:51 | 3198668 tango
tango's picture

After the 12/31 debacle I wrote my two Senators (GOP) that I saw no reason to vote GOP since the ONLY reason I would was their fiscal responsibility.  One sent a form letter with the usual excuses but the other actually answered three weeks later.  While I didn't agree with his premise (the vote may make Obama negotiate in good faith - LOL) I did appreciate the letter.   You gotta think - each rep has about 500,000 constituents and each Senator from half a million to 27 million.  Not a large chance for personal communication.

Wed, 01/30/2013 - 12:28 | 3199099 nofluer
nofluer's picture

I saw no reason to vote GOP

Between heavily gerrymandered districts (with the "party officials" counting the votes), and "man-in-the-middle" voting, you'll probably end up "voting" for them whether you know it or not

 

Wed, 01/30/2013 - 07:09 | 3198097 BeetleBailey
BeetleBailey's picture

correct. Best thing to do is confront them in a town hall....mob rules.....talk and incite others right there....make the news...but so the fuck what? These zombies need a whipping/tongue lashing, and what better way than to do it face to face.

Wed, 01/30/2013 - 12:22 | 3199069 nofluer
nofluer's picture

Best thing to do is confront them in a town hall

The last (and I mean last) "Town Hall" I went to was in an auditorium, with scheduled speakers for the "issue du jour". The Rep then made a few brief remarks, then rabbited out the back door. No chance for personal interaction. (They were on a raised stage in an auditorium with lots of "staffers" between the voters and the stage, and the audience "questions" were carefully managed and staged.)

If you want to talk to your Rep - one of the best ways is to come up with about $100,000 in bundled campaign contributions. But don't expect him to talk about any "issues" because as someone else noted, they don't KNOW anything, and they get paid to stay stupid.

Or you can bundle $100,000 and present it to his/her opponent in either the primary or the final, see if you can get the Rep's ass tossed out, and keep doing that every election until you run out of TBTF Proxies and get a REAL citizen elected... {Damn it Good Fairy! Stop hitting me with that spiky wand!}

 

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