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Exposed! Market Rigging and High Frequency Trading

Steve Kroft, 60 Minutes

Steve Kroft, Reporter on 60 Minutes, CBS News.

Exposure of U.S. Stock Market Rigging by High Frequency Trading

Market rigging and high frequency trading are the subject of the excellent blockbuster presentation on the CBS News program, 60 Minutes. The 60 Minutes presentation and a new book, Flash Boys by Michael Louis covers the subject of capital market fairness.

Canadian Trader Uncovers Market Rigging and High Frequency Trading

The excellent March 30, 2014 edition of CBS News program 60 Minutes presents, Is the U.S. stock market rigged? This program clearly explains the issue of market rigging and high frequency trading. 60 Minutes is the leading newsmagazine TV format with millions of viewers and fans around the world.

The market rigging story all came to light because Brad Katsuyama, a Canadian trader at the Royal Bank of Canada, realized that something had changed in the trading market. Unlike me, he took his investigation well beyond a superficial inquiry and observation. He put in the time and resources to uncover the details and issues. Any investor must see this video: Is the U.S. stock market rigged?

This story is happening to you and to your future, directly affecting your retirement! The market touches everyone, everywhere. It affects you more if you have any direct contact with the market. Any person with a pension, even basic universal pensions from governments, get touched and pay costs associated with high frequency trading.

New White Top View Series, High Frequency Trading 

This important topic opens a new White Top View Series, High Frequency Trading. Until the CBS News program, 60 Minutes segment put high frequency trading on the public agenda, major media reactions to Flash Boys remained muted. Links to the all parts of the White Top View Series, High Frequency Trading are at the end of this post.

Regulators Waking Up?

CBS reports that in the last two weeks, the New York attorney general and the Commodities Futures Trading Commission in Washington have both launched investigations into high-frequency computerized stock trading that now controls more than half the market.

It would be great if regulators are finally waking up to this massive attack on market integrity. No sensible informed person would hold the market is or ever was a level playing field. However, high frequency trading has been an egregious assault on capital markets. We shall see where the interest of regulators goes. Don’t hold your breath for any fast resolution. Too many billions being successfully picked from the pockets of all investors. That great stake will be vigorously defended. This will not quietly end.

I stopped short-term and day trading as a direct result of the market mugging by high frequency traders. When regulators everywhere subsequently meekly accepted high frequency trading as legitimate capital market activity, I knew my personal trading days were over. Now I strictly invest to produce income and grow capital. Individual short-term personal trading is an insane activity.

The most iconic market in global capitalism is rigged

That heading is a partial quote from Michael Louis, author of Flash Boys, available from Amazon, “The United States stock market, the most iconic market in global capitalism is rigged.”

Following is the description of the book:

“Four years after his #1 bestseller The Big Short, Michael Lewis returns to Wall Street to report on a high-tech predator stalking the equity markets.”

“Flash Boys is about a small group of Wall Street guys who figure out that the U.S. stock market has been rigged for the benefit of insiders and that, post–financial crisis, the markets have become not more free but less, and more controlled by the big Wall Street banks. Working at different firms, they come to this realization separately; but after they discover one another, the flash boys band together and set out to reform the financial markets. This they do by creating an exchange in which high-frequency trading—source of the most intractable problems—will have no advantage whatsoever.”

Inform yourself, watchIs the U.S. stock market rigged?  video.

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Image and video courtesy CBS

Links to the White Top View Series, High Frequency Trading

Part 1: Exposed! Market Rigging and High Frequency Trading

Part 2: High Frequency Trading and You

Part 3: High Frequency Trading Guru Brad Katsuyama Interviewed by Catherine Murray

Part 4:  Market Babel And High Frequency Trading

Part 5: Exorcising Another High Frequency Trading Devil

Part 6: High Frequency Traders Market Making Myth

Part 7: Investor You Can’t Have This High Frequency Trading Benefit

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