"In our living room we have nice a (cheap) pair of line, M&S curtains..."
Do you also have a book on English sentence structure? If so then you could benefit from reading it again.
I'm keen on energy efficiency. Some would also describe me as a cheapskate (I'd sue 'em all if I could find a cheap lawyer.) In our living room we have nice (cheap) pair of lined, M&S curtains with a (cheap) solar reflective blind hanging behind on the same hooks, which helps keep the room lovely and cosy in winter and cool in …
Software systems that will change the markets they run in should get a feedback analysis; they should be looked at like some sort of servo system which can oscillate or (with positive feedback) wildy run away.
Position (price), Rate and Acceleration analysis should check for possible problems.
That's never been what Equity markets are really about. And if it were, they wouldn't work - you need the speculators to provide the liquidity - and at least that benefits most participants.
Think back how much commission you'd have paid 20 years ago, compare that to now.
"Can someone trading from his mum's house on the wrong side of the Atlantic tens of milliseconds away from the US equity exchanges involved (remember that the big boys pay huge amounts to get closer and closer to the exchange, even co-locating ("co-lo") in the same room, shaving precious microseconds off their latencies to trade) can have any effect at all except by accident, or by being allowed to?"
Exactly. The fact of the matter is, this single trader should have no effect on the markets. And, the other fact of the matter is, these HFT trading systems are well-known to be using exploits in the trading systems, so not only do they get lower latency than everyone else (by being closer), they actually use these exploits to view trades and FORCE their trades ahead of those other trades in the queue! They "provide liquidity" by forcing their trade in the middle, taking away profit from somebody else. In this respect, they are parasites, not a vital part of the market as some claim. They do of course have true trading strategies and so on, but a lot of the "arms race" among them is how to analyze these in-queue trades (that they by al rights should have no access to anyway), analyze those, and force themselves ahead of them in the queue, faster than the other HFT systems.
So, riddle me this -- if these systems are permitted to continue to use these exploits to take (some of) everybody else's money, why is this guy not allowed to use OTHER exploits to take a little of this money back from the HFT systems? It is pure hypocrisy.
These are not exploits.
They rely on the use of special order types.
With a separate order sent on every share being traded.
How the exchange responds to this order tells the organization sending the order IE the HFT company,
These are not real orders.
They are in effect "pings" to the market to detect what is going on.
Apparently there are 150 order types supported by some (if not all) exchanges. These order types would not exist without the express support of the exchanges involved.
Once you're read "Flash Boys" you realize, this is no accident.
When I studied Civ Eng as a precursor for my subsequent career in IT nearly the first thing we were shown was the Tacoma Narrows bridge failure - it's an absolute classic. We were also told how soldiers (probably apocryphal) might break step when marching over a bridge. We had resonance explained in nauseating detail.
So they only seemed to have done wind tests, a slack handful of basic loading calcs, a static finite element analysis with pretty graphics and forgot rule 1(b). 1(a) is the wind is what'll shake it down, (b) is something else and there are lots of known somethings already and one of them is people - the primary purpose for a foot bridge!
"Doesn't it strike you as odd that the US is blaming the one person involved who doesn't have a permanent legal team and has never ever made 'campaign contribution' to American politicians?"
pick on the poor sucker who can't fight back. Makes everyone look good and get closer to their Lawfirm Partnership and Corner Office.
This is akin to the US habit of suing not only the suppliers of a product but their suppliers (even in some cases the company that cleans the bogs) and their suppliers in product liability cases.
Make a 10/32 UNF Screw? better be prepeared to get sued by someone sueing someone who used that screw in something that was then used by someone else in something that might have gone wrong.
Their Legal System is a big part of what is wrong with the USA today.
Then they had the temetiry to send several hunred lawyers over here for the Magna Carta celebrations!!! It is a wonder that they managed to get there without a thousand class actions being filed.
It's a long time since I studied Tacoma narrows, but as I recall the footage the driver got out of his car with loads of time to spare. What always amazed me about that footage, apart from the "wheee look at it bounce" factor, was how long that bridge survived. By the end it was doing extraordinary contortions and yet still more-or-less in one piece. Until it wasn't.
What finally destroyed Tacoma Narrows was the fact the wind was gusty, hitting it with high amplitude pulses of energy,
Since narrow enough high energy pulses fourier analyze into a broad range of frequencies this is a great way to find what frequencies a device or structure resonates without having to "sweep" the excitation signal (a variable speed wind is difficult to arrange).
Which it did.
Theo von Karman did the analysis on Tacoma Narrows should anyone want to find out more.
Where has it been said that this guy was a HFT? Hasn't he been quoted as hating HFT's himself?
As i understand he's been charged with old fashioned spoofing - the equivalent of getting your mates to huddle around your market stall and loudly shout about how awesome your £50 hot water bottles are and how many they are going to buy - that's been around for as long as you had public order books.
It's illegal because it's not a genuine order and distorts 'real' interst. Doesn't need low latency either.