Former NYSE Chairman Dick Grasso On High Frequency Trading: "Throw The Scalpers Out The Door"

CNBC Video - Grasso with Kernen on Squawk Box - Oct. 28, 2011

Clip runs 1 minute.  Grasso is wrong.  The entire practice should be banned.  He tries to make a distinction that doesn't exist.  Market makers are now and have always been scalpers, by the nature of their business.  I've been around long enough to remember 50-cent spreads on $10 dollar stocks, with Knight Trading sitting on the bid and ask all day long, fat and happy.  And a world without HFT will not revert to dramatically wider spreads as some argue with the proliferation of independent exchanges.

Check this out:

Video:  S&P 500 Futures Pit on May 6, 2010

Absolutely amazing.  This is how Armageddon sounds.

Many of you have heard this clip before.  For those of you who have not, buckle up for a ride.  Audio of a S&P 500 trader quoting the action that was taking place in the futures pit in Chicago at the CME.  The market lost nearly $1 trillion within minutes and then recovered most of the losses.  The DJIA and S&P 500 futures fell 10% intra-day.

More detail is here:

• Listen To The Stock Market Flash Crash - Tick By Tick

Comments

[DailyBail]

FLASH CRASH: Move Along, Nothing To See Here, Our Machines Work Perfectly

http://dailybail.com/home/flash-crash-move-along-nothing-to-see-here-our-machines-work.html

[Cheyenne]

I'm pretty sure Steve Liesman's position on CNBC is more in the nature of an endowed chair, something like the Unwavering Wall Street Lapdog of Misinformation. I'm actually working on a remote control patent that allows the viewer to mute a particular subset of speakers on any given television program in accordance with their screen position. CNBC would benefit most from this, though enormous gaps of radio silence might be off-putting at first.

There's a writer for the Tribune, Eric Zorn, who has the brain capacity of a runny egg. The weekly local alternative newspaper, The Reader, used to have a feature that packaged Zorn's spew of drivel into a set of bullet points. Its tagline: "we read Eric Zorn so you don't have to."

I wish a similar thing existed for the various TV and radio "pundits" of both political stripes when it comes to all things financial. Frequently, I'll be talking to someone and they'll say something so breathtakingly retarded that I can only imagine where it came from.

It's just amazing how tightly people cling to "their guy," as if he were a god, like a 5 year-old and Santa Claus. (At least Santa gives the kids stuff; query what Rachel Maddow does?) What made me think of this was Grasso's invocation of the Community Reinvestment Act, which many people seriously point to as some Archvillain of all evils financial. But it's been so long since I gave a flying shit about what Bill O'Reilly or Chris Matthews had to say about anything that I can't remember where that particular one came from.

[Howard T. Lewis III]

Dicjk Brasso puts lipstick on the pig by removing intent and creative enterprise from the equation of what constitutes positive creative, progressive investment. They might as well hand him a pail and a scoop to walk into the safe with and load up. Just like daddy taking him to the trout farm to 'catch the big one', the Bush41 deregulation provided a corrupt looting father figure with legal immunity to give 'the kids' avenue to unearned riches. Like if you signed your paycheck so I could cash it for myself because I think I am an 'alpha male predator'. He looks in the mirror and sees an'alpha male predator' because he has not yet been thrown in prison. Check his geneology and i am sure you will find this trait in abundance. The public, generally, trusts this guy for now, but if forced to sit and listen to what he condones, they would undoubtedly want to beat him (more) senseless.