4 ms·

Your comment, while snarky, isn't a refutable statement. As it stands you seem to be endorsing some position, which I'm inferring is in favor of Sanders and may

by dsacco 9y ago

Your comment, while snarky, isn't a refutable statement. As it stands you seem to be endorsing some position, which I'm inferring is in favor of Sanders and maybe in opposition to HFT. I can't really tell what you're getting at precisely though. > Remember how he was widely pronounced deranged for suggesting that there should be a fee associated with trades? How it would destroy the market? Who said this, specifically? What is your point in bringing it up? > Remember when Sanders proposed a small fee on every trade on Wall Street to discourage high frequency trading and to recoup some value from the market? I'm getting the sense that you'd be in favor of this - can you tell me why, in your own words, you believe we should be trying to "recoup value" from the activities of high frequency traders?

Pxtl 9y ago
It's mostly about how skimming a tiny bit of cash off of every trade is perfectly good for the exchanges to do to john Q public, but heaven help us if real traders have to put up with that. I have no idea if Sanders' plan was good or not, I'm more grousing about how critically important principles of how the market is supposed to work seem to vary depending on whether you're talking about consumer-level investments vs. institutional investors.
- jstanley 9y ago
  I still don't get what you're trying to say. Who is "skimming a tiny bit of cash off of every trade"? Do you buy into the notion that HFT is somehow so fast that it can travel back in time and jump ahead of orders that have just executed?
  - deleted 9y ago
    [deleted]
  - JetSpiegel 9y ago
    Why is it OK for the exchange to charge fees from every trade motivated by profit, but if the government does it to redistribute, it is somehow labelled as "market distortions"? Either fees on every trade distort the market, and in that case the exchange is distorting the market, or they don't have appreciable effects and the government can levy that tax. My opinion is that this a political opinion, and pretending that this is an economic concern is just a smokescreen.
    - jstanley 9y ago
      The exchange owns the exchange, and provides the service of running the exchange, and can set whatever fees they like, and people are free to use other exchanges that set different fees. The government already takes (more than) its fair share, from existing taxes. It has no right to also levy a tax on every trade on every exchange.
hasbroslasher 9y ago
I'm not OP but I sympathize: > Who said this, specifically? What is your point in bringing it up? Sanders. The point in bringing it up is to point out the irony that Wall Street already does this behind the scenes, but people called the Senator crazy for proposing it. > I'm getting the sense that you'd be in favor of this - can you tell me why, in your own words, you believe we should be trying to "recoup value" from the activities of high frequency traders? Shortest terms I can put this is: our country needs the money that Wall Street siphons off of the economy. We need more government money to educate, house, feed, and care for people. High frequency trading, unlike traditional investment, is not a "mom and pop" thing, it's a tool only accessible to the wealthy to enrich themselves. Thus, we should disincentivize it in order to generate tax revenue and discourage practices that are not accessible to shareholders.
- dsacco 9y ago
  All you did was move the goalposts... > but people called the Senator crazy for proposing it. Who called him crazy? That is my question. And the corollary to that question - why do we care about this party, and why is it relevant to the point? A lot of people say plenty of idiotic things, but that doesn't mean they have any real authority in the matter. I'm looking for precision and an understanding of why it's relevant. > Shortest terms I can put this is: our country needs the money that Wall Street siphons off of the economy. This is an emotionally loaded claim, and it's also not axiomatic. How precisely does Wall Street "siphon off of the economy" without providing value in exchange? > High frequency trading, unlike traditional investment, is not a "mom and pop" thing, it's a tool only accessible to the wealthy to enrich themselves. High frequency trading is a very small industry compared to all the types of trading that occurs on Wall Street. It has outsize publicity for a variety of reasons, many of which circle back to FUD. Moreover, every single type of trading firm is only accessible to the wealthy - that is very nearly what defines institutional trading. You are no more going to start a discretionary hedge fund than you are going to set up colocation and an FPGA for high frequency trading, which means that HFT is not nearly alone in being inaccessible. You're not actually explaining your point here. You're just repeating claims without defending them. On the contrary, market makers (who almost exclusively use HFT these days), provide liquidity to the market, just as the institutional investors in charge of endowments and pension funds provide value for retail investors' retirement savings.

by dsacco 9y ago

Pxtl 9y ago

It's mostly about how skimming a tiny bit of cash off of every trade is perfectly good for the exchanges to do to john Q public, but heaven help us if real traders have to put up with that. I have no idea if Sanders' plan was good or not, I'm more grousing about how critically important principles of how the market is supposed to work seem to vary depending on whether you're talking about consumer-level investments vs. institutional investors.

jstanley 9y ago
I still don't get what you're trying to say. Who is "skimming a tiny bit of cash off of every trade"? Do you buy into the notion that HFT is somehow so fast that it can travel back in time and jump ahead of orders that have just executed?
- deleted 9y ago
  [deleted]
- JetSpiegel 9y ago
  Why is it OK for the exchange to charge fees from every trade motivated by profit, but if the government does it to redistribute, it is somehow labelled as "market distortions"? Either fees on every trade distort the market, and in that case the exchange is distorting the market, or they don't have appreciable effects and the government can levy that tax. My opinion is that this a political opinion, and pretending that this is an economic concern is just a smokescreen.
  - jstanley 9y ago
    The exchange owns the exchange, and provides the service of running the exchange, and can set whatever fees they like, and people are free to use other exchanges that set different fees. The government already takes (more than) its fair share, from existing taxes. It has no right to also levy a tax on every trade on every exchange.

hasbroslasher 9y ago

I'm not OP but I sympathize: > Who said this, specifically? What is your point in bringing it up? Sanders. The point in bringing it up is to point out the irony that Wall Street already does this behind the scenes, but people called the Senator crazy for proposing it. > I'm getting the sense that you'd be in favor of this - can you tell me why, in your own words, you believe we should be trying to "recoup value" from the activities of high frequency traders? Shortest terms I can put this is: our country needs the money that Wall Street siphons off of the economy. We need more government money to educate, house, feed, and care for people. High frequency trading, unlike traditional investment, is not a "mom and pop" thing, it's a tool only accessible to the wealthy to enrich themselves. Thus, we should disincentivize it in order to generate tax revenue and discourage practices that are not accessible to shareholders.

dsacco 9y ago
All you did was move the goalposts... > but people called the Senator crazy for proposing it. Who called him crazy? That is my question. And the corollary to that question - why do we care about this party, and why is it relevant to the point? A lot of people say plenty of idiotic things, but that doesn't mean they have any real authority in the matter. I'm looking for precision and an understanding of why it's relevant. > Shortest terms I can put this is: our country needs the money that Wall Street siphons off of the economy. This is an emotionally loaded claim, and it's also not axiomatic. How precisely does Wall Street "siphon off of the economy" without providing value in exchange? > High frequency trading, unlike traditional investment, is not a "mom and pop" thing, it's a tool only accessible to the wealthy to enrich themselves. High frequency trading is a very small industry compared to all the types of trading that occurs on Wall Street. It has outsize publicity for a variety of reasons, many of which circle back to FUD. Moreover, every single type of trading firm is only accessible to the wealthy - that is very nearly what defines institutional trading. You are no more going to start a discretionary hedge fund than you are going to set up colocation and an FPGA for high frequency trading, which means that HFT is not nearly alone in being inaccessible. You're not actually explaining your point here. You're just repeating claims without defending them. On the contrary, market makers (who almost exclusively use HFT these days), provide liquidity to the market, just as the institutional investors in charge of endowments and pension funds provide value for retail investors' retirement savings.