I need more cowbell

Bearish on Banks - Why Now Is the Time to Sell

And of course GS this morning send out buco upgrades, so as to sell this trash. What a surprise!

High Frequency Trading: Legally, It's Called Churn

What department in Goldman Sucks do you work in, exactly?


On Jul 22 11:39 AM Sparchang wrote:

> I'm not sure you really know what you're talking about here. "Churning"
> is the term used when an investment advisor makes excessive net-neutral
> (or losing) trades in a client's account for the sole purpose of
> generating commissions for himself and his firm. It has nothing to
> do with excessive trading between HFTs or other prop trading firms.
>
>
> Regarding the activity seen in these three names recently, where's
> the problem? Every trade has two sides. Say there are only two HFT
> firms trading CIT. One makes the market you describe, and the other
> "churns" the market by crossing the spread back and forth all day
> long. The market maker would indeed make a killing... but only at
> the expense of the "churning" HFT, and not the retail investor or
> anyone else. Why does the latter HFT "churn?" Who cares? They're
> only throwing their own money away, not yours. If these names are
> truly "dead," as you suggest, then there aren't any retail investors
> in the market at all.
>
> Say these names aren't, in fact, dead. Setting aside the fact that
> individual markets are by no means required to move with the broader
> market trend (as you suggest they ought), what's the problem with
> a market participant wishing to make a deeply liquid market just
> outside the NBBO? They aren't going to be able to stop the stock
> from moving if "the fundamentals" indicate it should. No firm can
> provide sufficiently infinite liquidity to stop a market from moving
> up (or down) for long. Take the CIT market from a few days ago, when
> the stock moved from around 0.40 to 0.80 or higher midday. When it
> was around 0.40, you suggest there were HFTs conspiring to keep it
> there, making markets around 0.37-0.42 or so. What do you think happened
> when the stock jumped? Whichever HFTs were providing the offer got
> traded through and crushed, as appropriate. And your blessed retail
> investors, or whoever was fortunate enough to be taking the liquidity
> those HFTs were providing on the offer just beforehand, made over
> 100% in five minutes.
>
> Those who vilify HFTs clearly have no memory of the markets without
> them. When "natural buyers and sellers" want to participate in the
> market, who do you think they're trading with? Why do you defend
> the "right" of the "natural" participant to make money investing,
> and at once condemn the other side of the trade from wanting to do
> the same?