Bloomberg's Jonathan Weil Comments on GoldmanGate (Video)

Comments

[Bill L.:]

Interesting how the lead prosecutor makes it sound like the code is to dangerous for anyone to have... except Goldman that is. If there's only one market manipulator out there, we're all better off.

Jul 10 10:32 AM

[Uncommon_Cents:]

It is a shame that this story does not get more coverage. But, those who control the money, control the media...and the government...and everything else.

This story, combined with the Rolling Stone article, if ran with by the MSM, could easily tap into the TEA party type disdain that is bubbling ever closer to the surface of the American psyche. The average people are waking up slowly. Will the elites be able to take things back to the status quo before the boiling point is reached?

Jul 10 12:59 PM

[Moon Kil Woong:]

It is quite simple, any program that helps a firm deconstruct trades so they can tell what trades are time trades, where they are coming from, and who is placing it then it can aid in playing each participant. To do so requires a sophisticated means of deriving assumptions about placed trades. Of course Goldman controlling 40-60% of program trading helps. However, market makers and big players have been parcing which trades are coming from little people and what trades are coming from bigger firms for decades now. Call it what you will, but certainly the US equity market clearing is designed to let insiders know what you the general public will never know.

When an order gets placed it should go into a black box that no one should be able to derive a thing about who placed it or why. However, that just doesn't happen in the arcaic system called the US stock market. And for good reason. It would decimate the big boys gobbling up the spreads and parcing trades.

I'm sure if the code ever sees the light of day, you will be surprised how detailed they can cut up information to tell who is doing what. It is very detrimental to a fair market whether it's in the hands of an anonomous trader or a big firm like Goldman Sacs.

Jul 10 02:03 PM

[John Galt:]

It almost reminds you of a 3rd world country. Goldman Sachs, the rich guy, calls his friends at the corrupt police department to go arrest some guy that stole his drugs or something else illicit or illegal...

Jul 10 02:30 PM

[Alan Young:]

Fine interview! Bloomberg is letting it all hang out.

The prosecutor is blowing smoke, because there is no chance that Aleynikov will actually go to trial. Trial would require testimony, on the record, as to what makes that software so valuable. And we all know what the chance is that GS will allow that.

Jul 10 02:47 PM

[dcb:]

Goldman uses it to manipulate the markets, Duh

Jul 10 06:18 PM

[untrusting ...:]

Let's all hope enough individuals contact their politicans and attempt to get this investigated, although I would not bet on it. Maybe enough media will be forced to cover it now, that it becomes the "Watergate" of Goldman.


On Jul 10 02:47 PM Alan Young wrote:

> Fine interview! Bloomberg is letting it all hang out.
>
> The prosecutor is blowing smoke, because there is no chance that
> Aleynikov will actually go to trial. Trial would require testimony,
> on the record, as to what makes that software so valuable. And we
> all know what the chance is that GS will allow that.

Jul 10 07:18 PM

[Mark54:]

Exactly... but the code probably had a shelf life of less than a year in its current state. The real value is the insight that Goldman has to to this type of trading. It is interesting that a market participant can create a tool that can "manipulate" markets. Its the worst kept secret in finance... the Street is always one step ahead.


On Jul 10 02:03 PM Moon Kil Woong wrote:

> It is quite simple, any program that helps a firm deconstruct trades
> so they can tell what trades are time trades, where they are coming
> from, and who is placing it then it can aid in playing each participant.
> To do so requires a sophisticated means of deriving assumptions about
> placed trades. Of course Goldman controlling 40-60% of program trading
> helps. However, market makers and big players have been parcing which
> trades are coming from little people and what trades are coming from
> bigger firms for decades now. Call it what you will, but certainly
> the US equity market clearing is designed to let insiders know what
> you the general public will never know.
>
> When an order gets placed it should go into a black box that no one
> should be able to derive a thing about who placed it or why. However,
> that just doesn't happen in the arcaic system called the US stock
> market. And for good reason. It would decimate the big boys gobbling
> up the spreads and parcing trades.
>
> I'm sure if the code ever sees the light of day, you will be surprised
> how detailed they can cut up information to tell who is doing what.
> It is very detrimental to a fair market whether it's in the hands
> of an anonomous trader or a big firm like Goldman Sacs.

Jul 10 09:12 PM

[basehitz:]

So does this mean that "the smartest guys in the room" are dependent on a computer program which "in the wrong hands could be used to manipulate the market"? Not that Government Sachs would do that of course. (cough)

Note Bloomberg guy acknowledges how little coverage this gets except for the internet. Nice work Tyler.

Jul 11 09:12 AM