Entries Tagged 'Economics and Investing' ↓

On September 28th, the New York Times’ Business Page published “Beyond Wall St., Curbs on High-Speed Trades Proceed“. It shows how Australia, Canada, the European Union, France, Germany, and Hong Kong are all leading the United States in cracking down on high speed trading.

High speed trading employs computers located as close to the stock exchange computers as possible. The fastest computers use private high-speed cable rather than the Internet. Then high-speed traders employ programmers to build special algorithms (computer code) that can execute each trade in one trillionth of a second.

These “algos” are invisible to others. Algos prevent trades made by institutional investors and retail investors from taking place until the high speed traders need to sell their shares of stock that are about to fall in price.

Are “algo wars” among high speed traders causing stock exchanges and other financial markets to crash? Are algo wars increasing volatility in the market? In America, thanks to the opaqueness of the Security and Exchange Commission (SEC), it’s anyone’s guess. But many active traders and financial regulators in other countries believe high-speed trading is the cause of flash crashes and excessive volatility. Continue reading →

For the Presidential debates, Mitt Romney promised to throw zingers at Obama. He did, but the zingers didn’t really stick. What stuck with viewers was the amazing performance by Mitt Romney at the October 3rd debate. Continue reading →

In Springsteen’s song, “Wrecking Ball,” the Giant’s Stadium at the Meadowlands in New Jersey muses on its life. The Stadium, a long-time spectator of the epic sports events taking place within it, now faces its own contest, one it knows to be its first and last, against a wrecking ball. True to its nature the Stadium is a warrior to the end.

At about the same age as Bruce is now, W.B. Yeats, Irish revolutionary poet, wrote about visiting a children’s school and asked his famous question, “How can we know the dancer from the dance?”

Likewise, at just a slightly older age than Yeats and Springsteen, I have to ask, “How can we know reforms from the reformers?” Continue reading →