Do High Speed Trading Profits Support Wall Street Banks? What Would Happen If Profits Went Away?

Think of a row boat over the Marianas Trench. It's 36,069 feet deep. Mount Everest would be out of sight with a mile and one half from its summit to water level.Could that be a valid analogy of the height of the stock market and its reasonable value? If you subtract QE 2 that till recently was running at a trillion dollars a year of bond buying and trillion dollar deficits by our irresponsible government. Add that to all the stimulus from central banks like European Union, Japan and China.What is the value of stocks without this alchemy of money-printing support? What could possibly go wrong? Here's a thought. The recent glare of public scrutiny of High Frequency Trading coupled with S.E.C.and Department Of Justice and F.B.I. investigations could determine rather quickly if this type of trading is in fact illegal. Critics claim that high frequency trading is constructively front running legitimate orders from the public.If that HFT trading was stopped immediately what would be the financial ramifications? The question is . How much of the bottom line of Wall Street banks profit is tied to this type of trading? If it were stopped how much of their earnings would go away? Could the banks remain stable and pass stress tests if a portion of earnings were ruled illegal? Some years ago there were only three major exchanges-New York, American, NASDAQ.Now there are 13 public exchanges and 45 "dark pools" and 200 "internalizers". These have become for profit exchanges and off-exchange trading platforms .They sell access for money. That access enables firms like Moragn Stanley and Goldman Sachs and many obscure HFT firms to skim a profit from legitimate order flow.If that all stopped? Could these firms pay their debt? No amount of central bank alchemy could stop another panic about the security of bank stocks. It would be yet another example why Glass steagal should be reinstated and banks should not be on Wall Street

High Frequency Trading Publishes False Prices & Hides Layering Conspiracy

High frequency trading firms are in the news today. A Wall Street Journal article features new laser tower technology attempts by HFT traders at getting price discovery closer to zero time elapsed. If these guys can afford this type of investments then it speaks volumes how much money is made from front running orders. HFT accounts for 50% of all trading volume on U.S. stock exchanges. Since the HFT firms are only a relative handful  in aggregate compared to the legitimate order- issuing investing community it follows that their documented 50% total of volume is by definition an illegal trust and self dealing criminal enterprise. And there is more. These roving de facto criminal traders who parse pennies to 4, 5 or more decimal points publish their trades only in round numbers. The layering of who is buying and selling in an effort to boost the price of the shares at  the expense of legitimate orders should be forensically dissected but is hidden by round number publishing. There must be at least two trading firms to walk a stock up or down. There are probably more than that so it is a far reaching racket. They are stealing right under the noses of the S.E.C. The false reporting round numbers  is cause for change , fines or jail time.

Who Is Buying Stocks? Why Is The Market So High?

Who's buying stocks? Why is market so high? Maybe it has something to do with the increase of high frequency trading.Official SEC tallies of exchange volumes has high frequency trading making up 70% of daily volume.This is by definition not investment funds. The HFT computers parse pennies millions of times to front run other computers doing HFT  front running etc ad naseum. But there is another player. It's is the human day trader. He or she add another layer of high speed trading done the old fashion way. I.E. They do it by hand. In the news today, the SEC fined Peter Beck and his associate Charles Kim $250,000 each for failure to supervise their 5000 traders that work at  Swift Trade which is based in Toronto. The fine was failure to stop their stable of traders who range from Romania to New York from entering into conspiracies to "layer trades". Simply "layering" is an euphemism for "front running" . They collude to manipulate stocks . Swift Trade isn't the only day trading firm.So the 5000 day trders at Swift are multiplied by many more counterparts around the globe. The volume that all of them generate must make up a significant prtion of the 30% that computers don't do on a daily basis.

Could the extended levels of the Dow Jones and the S&P be the outcome of manipulation by here today gone tomorrow day traders?

BATS Global Market Exchange IPO: Revenge Hacking Crash ?

Yesterday the slimey BATS Global Exchange IPO got slimed. It's the focus of an SEC investigation of what's wrong with volatile modern day equity markets . Was a 'software bug" to blame? An exchange spokeman said it was. Anyone want to believe a spokeman for a controversial high frequency trading platform whose controversial front running order strategies range to hated? Or was it a hacking revenge event in the publics interest by a dwindling ,fed up minority of honest Wall Street operators ?.The IPO was pulled. It's tough to pull on slime. But where's there's a will there's a way. The offering was priced at $ 16. Moments later it traded at less than a penny. That's ironic because BATS makes mischief by parsing pennies. Slime handlers , Credit Suisse , Citi Group and Morgan Stanley underwriters had to withdraw the offering from the very  exchange that BATS started in 2005. Since that time BATS has grown to handle 11% of toatal equity volume and 3% of option equity contracts in U.S. They got rich. But the SEC and others are wondering what the slime ball firm does for the public interest?

Thank you to ever pulled this sliming off.

George Soros Greed Avoids Government Accounting

The 19th century German philosopher Arthur Schopenhauer once said, "The foulest non -productive professional was a Jewish stock operator". Was he describing George Soros? I knew a senior trader who once worked for George Soros. He told me, " That if you ever meet a Hungarian Jew [George Soros], sock him! He will know why! The trader said Soros was slow pay and short pay. In a way,Schopenhauer was somewhat supported in his opinion some 100 plus years later.

Georgy boy is in the news today. He's giving back "outside" managed money because the new Dodd Frank rules have just kicked in. Those rules will require greater reporting by Soros to the SEC about how he makes his money. Conincidentally another repoting requirement also kicked in. It requires high-frequency traders, that includes Soros, to report their trading activity to the S.E.C the FOLLOWING day. That type of trading was responsible for the "flash crash". So his possible destablizing market operations would be quickly examined.

Obviously Soros can't stand regulatory light on behavior. He would have gone no where on Wall Street if the rat traps were better years ago. He should be considered a persona non grata .