

1215095 – The Flash Boys Mystery Solved? - sgt101
http://blog.themistrading.com/1215095-the-flash-boys-mystery-solved/

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mijoharas
Sorry, not having read the book and with just this blog post as context I
don't understand the problem. Why wouldn't an HFT company want to own a
microwave tower that transmits stock prices? why is that unethical? seems
perfectly reasonable and like it would be a useful to the business. Am I
missing out on some piece of information.

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kasey_junk
I think the blog post is trying (and failing) to encourage a sense of moral
outrage that the SEC, who is the watchdog agency for some HFT firms, is buying
services from an HFT firm.

They are piggy backing on the press from the book (the blog post is from
months ago when the book came out) to bring this back into the conversation as
it has been clear for some time that the SEC is paying for technology from an
HFT firm. The book doesn't point this out by the way, but it was public
knowledge.

Personally, I'd like to know who is in a better position to provide the
technologies to understand HFT than a HFT firm? I would be suspicious of any
vendor that claimed they could provide a platform for this that wasn't in the
industry.

Also, as a bit of context Themis Trading (the blog posters) is an execution
trading house. That is, they make their money by making trades for large
institutions with the express value add of being able to get the lowest
execution prices. This is precisely the kind of thing HFT has made
cheap/redundant. That is they are natural competitors to HFT firms.

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matt_morgan
It may be true that there are no disinterested players in this debate. But his
overall point is that the SEC paid an HFT firm to supply systems that would be
used to oversee HFT, and that seems worth repeating regardless of his own
interest in the matter.

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mlrtime
Not really, Thesys is a technology provider to many firms. Providers include
financial services firms, trading companies and regulation authorities. If the
SEC purchased the technology (Or spend more money to build it themselves) they
would be ridiculed for having inferior technology.

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msandford
The point is that the people providing the technology have an interest in the
SEC not deciding to push for additional, non-HFT friendly market rules.

Is it possible that there's no way to get it besides from a company which
might/probably/definitely have a conflict of interest? Yes. Does that somehow
negate said conflict of interest? No.

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tankenmate
It has been a while since the book was published; and yet it wasn't mainstream
media that brought this fact and the conflict of interest it entailed to the
fore.

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kasey_junk
Just as a heads up that blog post is half a year old. It came out shortly
after the book.

