Public Advocacy: Financial Reform

1. Financial Times 3/6/13: FBI Joins war against abuse of fast trading: To quote, The FBI has teamed up with securities regulators to tackle the threat of market manipulation posed by sophisticated computer trading strategies that have taken markets beyond the scope of traditional policing. FBI Agents have joined forces with a new unit in the SEC examining hedge funds and other firms that are using algorithm-based trading strategies.

The trades are so quick, often completed before the information is widely disseminated that authorities are debating whether these trades violate insider trading rules?

2. On 2/22/13 NY Times Floyd Norris reported on “A tax that may change the trading game”. The European Markets are considering taxing hedge funds and flash traders (see above US position) in miniscule increments, thus imposing more stability into the marketplace. The purpose is to reorient the financial system back to financing the real economy. We are making choices?

3. In another article from The Financial Times, dated 2/20/13 “In search of the Fast Buck”, the Times explores high speed trading on another level. After disrupting the equity markets, high speed trading is moving rapidly into bonds, currencies and derivatives. As we know from experience, people with speed trading as their sole strategy for trading do not add value to the overall client market.

Judging from the Regulatory work performed here and abroad, maybe we won’t have to cower before this new found trading platform. First we’ll determine legality and then, perhaps, we’ll implement a tax strategy curtailing their use? We have choices!

4. LOL Bill Moyers on PBS conducted an interview with Richard Wolff, an Economist, who lamented about today’s Financial Imbalances. To paraphrase him, “as we salvaged the Banks, the Bankers have moved their income off shore, to avoid corporate and personal taxes” . Leading us back to The Financial Times, reporting recently; Money, money everywhere, but not for the “real Economy”!

We are making choices!


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