I never said there was no liquidity in the markets before HFT came along. I was making the argument that there is much more liquidity because of high-frequency trading. As a result of this much more liquidity, the markets are more efficient. If your only concept of a productive enterprise, however, is one that produces material goods, then there is no point in having this conversation. I do have one response to your sentence:
It doesn't even provide a specialized service that saves people time/money.
You are so far from reality here. Do you understand what the futures markets are for? Do you understand that there are a whole class of speculators, among them are HFT firms, that stand ready to do business with a farmer growing corn, a gold miner mining metal, a cattle producer with cattle to go to the market, etc? By providing liquidity, the farmer can focus on farming, the miner can focus on mining, and the cattle rancher can focus on ranching (whatever they call it) instead of worrying about what they may sell their raw goods at in the market four, five, or six months from now. So, no, I am not out in the fields digging up copper and sand, but I, and others in the industry, make it possible for those that do those things to focus on doing those things. If I figure out a way to make some extra money by using mathematics and computer science, then so be it.
It doesn't even provide a specialized service that saves people time/money.
You are so far from reality here. Do you understand what the futures markets are for? Do you understand that there are a whole class of speculators, among them are HFT firms, that stand ready to do business with a farmer growing corn, a gold miner mining metal, a cattle producer with cattle to go to the market, etc? By providing liquidity, the farmer can focus on farming, the miner can focus on mining, and the cattle rancher can focus on ranching (whatever they call it) instead of worrying about what they may sell their raw goods at in the market four, five, or six months from now. So, no, I am not out in the fields digging up copper and sand, but I, and others in the industry, make it possible for those that do those things to focus on doing those things. If I figure out a way to make some extra money by using mathematics and computer science, then so be it.