> If we had no price discrimination, perhaps because of a regulation requiring market makers to leave their quotes out in the market for 60 seconds, then ... [t

> If we had no price discrimination, perhaps because of a regulation requiring market makers to leave their quotes out in the market for 60 seconds, then ... [t]he net result is that Big Joe would pay more to trade and Little Billie would pay less. The debate about HFT is largely about who gets to benefit from new information. Suppose someone does a lot of research and discovers that a firm is undervalued. Should they get to profit from the information, at the expense of current stockholders? Or is it better for stockholders to quickly figure out that their holdings are worth more? HFT helps the stockholders in this case, because it moves the price faster to its eventual higher equilibrium before the researcher can buy up many shares at the (low) current price. The researcher may have expended a lot of time and effort to get this information, and with the existence of HFT their work may not be sustainable. Contrast this with someone who accidentally discovers public information that could be profitable, or someone who engages in insider trading. In both these cases it's hard to argue that we as a society should create rules that let them profit at others' expense. In other spheres of life (software patents, copyrights), the law over-protects dubious discoveries and creations. Is information related to stock pricing different? Are we under-protecting it, such that we should let someone with new information collect more profit than they can today?