Silver as an investment

WealthCycles: High-Frequency Trading Is Old News… and Illegal

Be prepared for the next great transfer of wealth. Buy physical silver and storable food.

Celebrity author Michael Lewis comes out with a new book, and suddenly the entire world is spellbound and scandalized by the intricacies of high-frequency trading—save for the elite Wall Street insiders and whistle-blowing data geeks to whom it is old news. What Lewis’ book arguably has done is bring the debate over HFT out into mainstream channels, potentially creating enough embarrassment on the part of regulators and the justice system to force them to finally step up and enforce the existing laws—which should have put the kibosh on the most egregious abuses of HFT long ago.

The book in question is Michael Lewis’ Flash Boys: A Wall Street Revolt, a narrative of some allegedly good guys who stumbled upon the fact that millisecond differences in the speed at which trades are transmitted to different exchanges opened the door for traders using super-fast computers to buy up the supply and sell it back to investors at a higher price. The price differential might be only fractions of pennies, but multiplied out over billions of trades, it means a healthy profit for high-frequency traders—profit that comes at the investors’ expenses.

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