Larry McGinity: High Frequency Trading

References

‘Manchurian Candidate Market. High frequency terrorism: How the Big Banks and Federal Reserve Maintained Their Death Grip Over the United States’ ritholtz.com Barry Ritholtz is a New York based Wealth Fund Manager, financial journalist and frequent contributor to Bloomberg TV

‘Only those in the 'inner circle' (co-located at the premiere routers) have real-time data, and by the way, know precisely how delayed the data is you are getting.’ Eric Hunsader, Nanex Eric Hunsader is an internationally recognised expert on electronic data collection in fast trading, his company Nanex has provided information to Congressional Committees.

‘And the computer algorithmic traders who are using these 'black-box' trading mechanisms are scooping out billions and billions and impoverishing millions. And the policy makers call it 'making a market', but that clearly is not the case; they're looting. What don't you understand about that word?’ Max Keiser Max Keiser, former options trader and iconoclastic financial journalist with his own show The Keiser Report on RT, was a critical source of information for this series of paintings.

‘It was a fevered race to zero, trades that moved so fast they took place instantaneously. Concerns mounted about whether high-speed trading would also mean high-speed crashing.’ Scott Patterson - Dark Pools Wall Street Journal columnist Scott Patterson was named New York Times Best Seller for his breakthrough books The Quants . This quote comes from his fascinating exposure of the underbelly of fast-speed financial dealing Dark Pools which has been a major contributor to the debate about whither financial markets.

Hay Hill Gallery, 35 Baker Street, London W1U 8EN Tel: 020 7486 6006, 020 7935 5315, Fax: 070 5362 1735 [email protected], www.hayhillgallery.com High Frequency Trading: Full Acknowledgments

‘Mysterious and possibly nefarious trading algorithms are operating every minute of every day in the nation's stock exchanges.’ theatlantic.com

‘Well, the thing with high frequency trading - it's just another tool in a toolkit for commercial investment firms to basically intervene in markets to drive liquidity, and force retail investors to buy at a higher price and sell them at a lower than they would in a free market.’ J.S Kim

‘SEC Probes Cancelled Trades’ W.S. Journal Headline

‘As the CNBC guy explains, the market is no longer run by people buying and selling, and the result being the price. What we see are computers run by governments and they're stealing. They're using the markets as a facade to steal: when you go into a casino it looks kind of normal, but you walk out with no money.’ Max Keiser

‘Making the jump from micro-seconds to nanoseconds will ratchet up the competition.’ Larry Tabb, CEO Tabb Group

‘I can tell you for myself, operating within a wealth management firm: the dealers who do what I would call 'real investing' i.e. not running HFT programmes or operating dark pools - but people who are making real investments for real clients - you know, they're just terrified because the volume in the real market is just dropped off completely and the slack has only been taken up by these HFT algos.’ M.Bett, wealth manager

‘Right now they're producing 6.1 million messages per second.’ Stacy Herbert

‘The 4300m cable that will save traders milliseconds "A one millisecond advantage could be worth up to $100 million (GBP 63m) a year to the bottom line of a large hedge fund."’ telegraph.co.uk

‘Because the trading is done through computer trading, it's all fake trading. The insiders have been net sellers in record amounts as they take their cash out of the market and they buy gold and silver; but they have computers buying and selling to create a simulated facade of market participation for public consumption by those idiots like James Kramer at CNBC who don't mention the fact that underneath the surface all the volume is being drained out of the system by the top 1% criminal terrorists on Wall Street.’ Max Keiser

‘High Frequency Firms Triple Trades in Rout’ bloomberg.com

‘Manchurian Candidate Market. High frequency terrorism: How the Big Banks and Federal Reserve Maintained Their Death Grip Over the United States’ ritholtz.com

‘Only those in the 'inner circle' (co-located at the premiere routers) have real-time data, and by the way, know precisely how delayed the data is you are getting.’ Eric Hunsader, Nanex

‘The stock market's fastest electronic firms boosted trading threefold during the rout that erased $2.2 trillion from U.S. equity values stepping up strategies that profit from volatility.’ bloomberg.com

‘And the computer algorithmic traders who are using these 'black-box' trading mechanisms are scooping out billions and billions and impoverishing millions. And the policy makers call it 'making a market', but that clearly is not the case; they're looting. What don't you understand about that word?’ Max Keiser

‘Market Data Firm Spots the Tracks of Bizarre Robot Traders’ theatlantic.com, headline

‘Sergey Aleynikov Gets 8 Year Prison Sentence’ zerohedge.com

‘Nanex explains there was another kind of test run on July 6th in a quiet hour before the markets opened. Suddenly he saw a huge spike in band-width on his own system monitoring the algorithm there. When they looked at the data, they found that 84, 000 quotes for each of 300 stocks had been made in under 20 seconds.’ Stacy Herbert

‘These quote stuffers - if the Founding Fathers of America were around today - you know what would happen today - it wouldn't be pretty - it would involve a very heavy sharp object.’ Max Keiser

‘U.S. prosecutors have joined a regulatory investigation into whether some high-speed traders are manipulating markets by posting & immediately cancelling waves of rapid-fire orders. Justice Department investigations are working with the SEC to review practices 'that are potentially manipulative'.’ bloomberg.com

‘Percy reckons that through a combination of improved lasers and shortened cables, the day may soon come where traders can execute a trade between New York and London at close to 40 milliseconds. Anything faster is physically impossible, save for drilling through the planet.’ Bloomberg Business Week Report

‘System Handles Market Data in 600 Nanoseconds’ securitiestechnologymonitor.com

‘Of course in Vietnam we saw Agent Orange used in carpet-bombing the nation of Vietnam; our current Agent Orange in this financial war is high frequency trading.’ Stacy Herbert

‘In fact, it does the opposite. It dries up liquidity because when retail investors got frustrated that they can't execute a trade, a lot of them fall off, they withdraw their bids, and that actually dries up liquidity rather than contributing to it.’ J S Kim

‘People still don't know anything about what caused the flash crash of May 6th that lost trillions of dollars of market value for a lot of companies - certainly hundreds of billions - and I think it's called into question a whole lot of issues about market structure and the stock market, that a whole lot of people let lay fallow and stopped thinking about after, say, 2002’ Heidi Moore

‘They've got Goldman Sachs and all the government bond dealers with high-frequency trading a co- locating server right down the Street for the New York Stock Exchange, flooding the exchange with millions of orders every day, clearly manipulating the market. Nobody questions if they're manipulating the market.’ Max Keiser

‘Regulators are scrutinizing what some in the stock market are calling 'quote stuffing' trading in which unusually large numbers of orders to buy or sell stocks are placed in a fraction of a second, only to be cancelled almost immediately.’ W. S. Journal

‘So all these co-located servers that hedge funds are putting at the exchanges, in order to get a millisecond advantage over everybody else, give them the ability to sniff orders before they go to the market, allows them to front-run investors.’ Barry Ritholtz

‘For the explanation, in a flood event one exchange crushes the other exchanges, potentially giving someone somewhere a 100 to 200 millisecond advantage, alsoknown as an 'eternity' in the HFT world.’ Eric Hunsader, Nanex

‘The man who single-handedly 'almost' stole Goldman's algorithms that could 'manipulate markets' is now the person with the biggest prison sentence to come out of the entire financial crisis.’ zerohedge.com

‘These guys are literally putting billions and billions of dollars out - that profit doesn't come out of thin air, that profit comes from the actual investing public; and it's really a great tragedy.’ Barry Ritholtz

‘These are like drones: when they send the drones into Afghanistan, or some other country and they just kill people, without any regard to what they are doing, just blindly killing people. Wall Street has these robotic trading robots that are executing trades that are designed to steal money. They don't care who they steal the money from - even from themselves.’ Barry Ritholtz

‘Robin Griffiths, a Cazenove banker speaking on CNBC Europe stated when asked why the Dow and S&P were doing the best this year since 1939 - I think one of the reasons is what are called permanent open market operations. POMO - you're going to read more about those initials.’ Robin Griffiths

‘Just because they hold on to it for a nanosecond, doesn't make it go away, but it does allow the fluff, the cotton candy derivatives economy, to grow faster and bigger and out of control.’ Stacy Herbert

‘This new company Burstream can process a new piece of data in 600 billionths of a second, regardless of how much data stock markets areproducing.’ securitiestechnologymonitor.com

‘It was a fevered race to zero, trades that moved so fast they took place instantaneously. Concerns mounted about whether high-speed trading would also mean high speed crashing.’ Scott Patterson - Dark Pools

‘To some degree, essentially what happened in the flash-crash was you had actual orders to show up in what was believed to be a liquid market and all the computers pulled their bids and as a result you had the reality of the inequality of the market which suddenly asserted itself. And this is the danger in believing that you actually have liquidity that is generated from the high frequency trades.’ Karl Denninger

‘Ex-Goldman Programmer Freed After Theft Conviction Thrown Out’ bloomberg.com

‘America appears to be sleepwalking towards disaster, does any one care?’ Liam Callagher, DailyTelegraph

‘Knight blamed its technology breakdown on the software, but "offered no explanation as to why traders didn't immediately intervene to arrest the obvious errors".’ forbesonline.com

‘No the computer was buying the stocks - the people got out months ago you fricking sucker.’ Max Keiser

Hay Hill Gallery, 35 Baker Street, London W1U 8EN Tel: 020 7486 6006, 020 7935 5315, Fax: 070 5362 1735 [email protected], www.hayhillgallery.com