That paragraph was meant to be glib, sorry if it wasn't precise enough. Money Stuff #2 has cratered before it really got wings. That said, your response is hal

That paragraph was meant to be glib, sorry if it wasn't precise enough. Money Stuff #2 has cratered before it really got wings. That said, your response is half accurate. You're right that not all trading on non-public information is illegal, because price discovery is important (note, however, that in common parlance, 'insider trading' refers to illegal insider trading, not trading on non-public information). Anyways, regardless that's not the case here. First off, frontrunning does not help with price discovery. Second, trading ahead of a trade that's imminent and non-public is not legal. The opening subsection of rule 5270 is fairly straightforward: "(a) No member or person associated with a member shall cause to be executed an order to buy or sell a security or a related financial instrument when such member or person associated with a member causing such order to be executed has material, non-public market information concerning an imminent block transaction in that security, a related financial instrument or a security underlying the related financial instrument prior to the time information concerning the block transaction has been made publicly available or has otherwise become stale or obsolete." Recall, FINRA went to lengths to point out that this was ALREADY illegal by the time this section was put into force after the flash crash. As for Munger, his views are fairly straightforward. https://www.cnbc.com/video/2013/05/03/why-charlie-munger-thinks-hft-is-basically-evil.html https://www.cnbc.com/video/2013/05/03/why-charlie-munger-thi... https://www.cnbc.com/video/2014/05/05/hft-equivalent-of-rats-in-a-granary-munger.html https://www.cnbc.com/video/2014/05/05/hft-equivalent-of-rats... "It does civilization no good at all. It's the equivalent of letting rats into a granary. I don't like it." I think your note regarding Levine shows a point you've missed. I'm not saying Levine is for or against HFT activity. I'm saying he prefers a narrow interpretation of the term front-running like you do. However, even he capitulated, because both usages are acceptable. Hence my original note at the start of this chain where I note there's a dispute regarding the use of the term. "In Money Stuff yesterday I said that "I seem to be losing the fight against semantic drift in the term 'front-running,'" which (I thought) used to mean a broker's breach of fiduciary duty by trading ahead of his customers, but which now seems to mean anyone's trading ahead of anyone else. Reader Bill Bremse pointed out by e-mail that some form of the second sense has been in respectable use for quite a long time, including by Larry Harris in the 1990s. I am not sure there is any higher authority on market-structure usage than Larry Harris, so I will cheerfully confess error on this one. "Front-running" can indeed mean something other than an illegal fiduciary violation, though at least Harris seems to have used it to mean trading ahead of exposed limit orders, not racing to trade on one exchange after seeing executions on the other. Though I don't know how much that was a thing in the 1990s." A bit of an explanatory note: Prof. Larry Harris literally wrote the book on exchanges. He was also the Chief Economist for the SEC in the early 2000s, and later the head of their economic analysis unit. Here's Order Exposure and Parasitic Traders, which he authored in 1997, well before HFT really took off. He refers to the activity we're discussing as front running, and explains systemic issues with the trading strategy before the HFT industry even existed: http://www-bcf.usc.edu/~lharris/ACROBAT/Exposure.pdf http://www-bcf.usc.edu/~lharris/ACROBAT/Exposure.pdf