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On Friday, CNBC called us to book an appearance today on Power Lunch for what we believed was to talk about what they are calling the “flash crash”. We were prepared to give our take on what actually happened on Thursday. We were going to say the crash showed a market structure flaw and it was not due to a fat finger. We were prepared to talk about how automated “market makers” have little or no obligations today yet enjoy all the benefits that co-lo, direct data feeds and rebates bring. We were going to mention how the NYSE has been hailing their “circuit breaker” slow model
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Some Thoughts: Late last week we saw the new market structure exposed for what it really is: A house of cards built on a troubled foundation. Just like this year old construction built on a suspect foundation, our equity markets are in danger of falling unless the foundations are repaired. As we have been saying for nearly two years now, a system in which high frequency firms own stakes in Exchanges, whose officials and friends sit on boards of high frequency trading firms, who hire consultants, who sit on the boards of other Exchanges, who… damn I am tired. Who
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