I read the article, and I believe you have misunderstood it. When an order enters an exchange, it will be matched with any offers that are already in the system. There is no opportunity to see that order, then run ahead of it to buy shares *on that exchange* and then use them to fill that order. If you offer to buy X at $100, and there are existing offers to sell X at $100, you will be matched with them based on whatever matching rules the exchange uses. There is no legal opportunity for someone to "beat" you to those sell offers and then turn around and try to sell the shares to you at a higher price before your order has a chance to be filled. What the article talks about is working across many different exchanges, which is a different story. i.e. seeing activity on one exchange and anticipating the same activity in a different exchange before you get to it.
contribute to society except for profit for themselves
Your opinion, fortunately we aren't slaves to one person's opinion as to what is valuable "to society". I am sure all the employees, their families, children, dogs, etc. of the HFTs, producers of all the networking and computing gear they use, the buildings and home they inhabit, the doctors they visit, and so on, might disagree with you about the lack of contribution to society.
Frontrunning in the sense of seeing an order before it hits an exchange, and then trading in front of it, is illegal. This could happen in a trading house that also handles large institutional orders, and the in house HFT business could illegally trade against that.
Without introducing any value? According to whose opinion, yours? We are very fortunate (in the US at least) that we are not yet entirely enslaved to one person's opinion as to what is valuable. Obviously, the exchanges see value in it or they wouldn't be supporting it.
What you describe is illegal, if you have any evidence of this feel free to forward it to the SEC. Once an order hits the exchange it is on equal footing in regards to being matched with any offers. Some aspects of HFT work by anticipating demand and hitting the exchange before others, this has always been the case since markets were invented.
Why should anyone develop any product if someone else can just clone it and sell it cheaper?
This happens all the time, with millions of products, including the food you eat. And it also happened with all the products that today enjoy the protection of patents and trademarks, before that type of product was even eligible for patents and trademarks.
Probably because ISPs have much more immediate and probable threats to deal with. Let's inject a little bit of reality into the discussion. Correct me if I am wrong, but actual attacks (as opposed to misconfigurations) through routing insecurity on the global Internet number zero. (Unless you count state level attempts at censorship, which is moot in this case where we are asking why ISPs don't do more) This Google hijack was quickly corrected thanks to all the monitoring and response procedures that are in place. Yes, I understand that is a fun 22 minute window for hijinx to ensue. There are also lots of easier ways to enact these hijinx, hence the number of attacks is zero. DNS attacks at the server level are relatively rare compared to all the other ways criminals can get what they are after. Security effort is a scarce resource, just like any other, and it will tend to get spent where the return is highest.
I don't agree. Well, ok, yes this might be what happens in some cases. However, there are plenty of cases, especially in the earlier years, where owners declined to fix anything until full details were disclosed. Excuses like no one else would ever use this, it can't be exploited, etc. were all over the place.
I think the changes brewing in the wake of Target breach and Snowden's leak show the power of full disclosure. It seemed to me that "responsible disclosure" was just another way of saying "no consequences." And we see time and time again how no consequences equals no action.
I agree. But what I have to wonder if we are missing out in a different way. Some kids develop at a different pace, is it optimal to have a system where a 'late bloomer' is marked as slow or average for their first few years of school? Once that label is put on, it is part of their self image thereafter. What if there are geniuses who don't really come into their own until high school who then never get a chance since they have been 'average'? I read somewhere that when you test people at 35 years these early differences disappear, at least in most cases. Sorry no reference, so it may not be an accurate recollection. Just thinking out loud here, I am not proposing anything.
This is an important distinction. A competitive environment encourages at least some level of efficiency, as long as there are real consequences. "Private" isn't some magic wand that will solve problems. If you take a government run monopoly and turn it over to a privately run monopoly, you aren't going to see much improvement.
You need to ask yourself your own question. Competition works out really well for so many things that you take for granted here. And instead you cherry pick one small aspect of one industry that you feel supports your opinion.
It is in some ways a tough question. If Wikipedia says your organization was founded in 1999, and it was founded in 1989, shouldn't you edit it? What is a donor supposed to do when there is an inaccuracy like that? I guess the point of the article wasn't the quality or accuracy of the edits so much as the ignoring of the terms of service at the time, presumably implying that the donations incurred immunity. It is unclear if non-donors received a higher level of reaction to the same thing.
Slashdot Mirror
I read the article, and I believe you have misunderstood it. When an order enters an exchange, it will be matched with any offers that are already in the system. There is no opportunity to see that order, then run ahead of it to buy shares *on that exchange* and then use them to fill that order. If you offer to buy X at $100, and there are existing offers to sell X at $100, you will be matched with them based on whatever matching rules the exchange uses. There is no legal opportunity for someone to "beat" you to those sell offers and then turn around and try to sell the shares to you at a higher price before your order has a chance to be filled. What the article talks about is working across many different exchanges, which is a different story. i.e. seeing activity on one exchange and anticipating the same activity in a different exchange before you get to it.
"When HFT firms get a look at the order book prior to the orders being executed" That is illegal already.
contribute to society except for profit for themselves
Your opinion, fortunately we aren't slaves to one person's opinion as to what is valuable "to society". I am sure all the employees, their families, children, dogs, etc. of the HFTs, producers of all the networking and computing gear they use, the buildings and home they inhabit, the doctors they visit, and so on, might disagree with you about the lack of contribution to society.
Frontrunning in the sense of seeing an order before it hits an exchange, and then trading in front of it, is illegal. This could happen in a trading house that also handles large institutional orders, and the in house HFT business could illegally trade against that.
Without introducing any value? According to whose opinion, yours? We are very fortunate (in the US at least) that we are not yet entirely enslaved to one person's opinion as to what is valuable. Obviously, the exchanges see value in it or they wouldn't be supporting it.
What you describe is illegal, if you have any evidence of this feel free to forward it to the SEC. Once an order hits the exchange it is on equal footing in regards to being matched with any offers. Some aspects of HFT work by anticipating demand and hitting the exchange before others, this has always been the case since markets were invented.
The Qing Dynasty actually did require males to have the same haircut. China, not Korea, but ideas can spread across borders, even North Korea's
We can call this Cohiba's Corollary
To paraphrase Hannibal Lecter, a sane society would either kill them or let them have their books.
Its just a barter system
This applies to any currency, unless you are dealing in chocolate coins.
Why should anyone develop any product if someone else can just clone it and sell it cheaper?
This happens all the time, with millions of products, including the food you eat. And it also happened with all the products that today enjoy the protection of patents and trademarks, before that type of product was even eligible for patents and trademarks.
That is interesting, I will think on it. Thanks.
Probably because ISPs have much more immediate and probable threats to deal with. Let's inject a little bit of reality into the discussion. Correct me if I am wrong, but actual attacks (as opposed to misconfigurations) through routing insecurity on the global Internet number zero. (Unless you count state level attempts at censorship, which is moot in this case where we are asking why ISPs don't do more) This Google hijack was quickly corrected thanks to all the monitoring and response procedures that are in place. Yes, I understand that is a fun 22 minute window for hijinx to ensue. There are also lots of easier ways to enact these hijinx, hence the number of attacks is zero. DNS attacks at the server level are relatively rare compared to all the other ways criminals can get what they are after. Security effort is a scarce resource, just like any other, and it will tend to get spent where the return is highest.
I don't agree. Well, ok, yes this might be what happens in some cases. However, there are plenty of cases, especially in the earlier years, where owners declined to fix anything until full details were disclosed. Excuses like no one else would ever use this, it can't be exploited, etc. were all over the place.
Additional thought: responsible disclosure only works because of the threat of full disclosure.
I think the changes brewing in the wake of Target breach and Snowden's leak show the power of full disclosure. It seemed to me that "responsible disclosure" was just another way of saying "no consequences." And we see time and time again how no consequences equals no action.
An excellent point AC. Why are we assuming that early life education is destiny?
I wonder if a gifted program full of Asian kids would be insufficiently diverse.
I agree. But what I have to wonder if we are missing out in a different way. Some kids develop at a different pace, is it optimal to have a system where a 'late bloomer' is marked as slow or average for their first few years of school? Once that label is put on, it is part of their self image thereafter. What if there are geniuses who don't really come into their own until high school who then never get a chance since they have been 'average'? I read somewhere that when you test people at 35 years these early differences disappear, at least in most cases. Sorry no reference, so it may not be an accurate recollection. Just thinking out loud here, I am not proposing anything.
Isn't it really just a standard for the socket? They can still innovate all they like on how the power gets in there.
Well said, I read too much into your original statement. Cheers, thanks for clarifying!
hahahahah "mother" I love that, I will use it
This is an important distinction. A competitive environment encourages at least some level of efficiency, as long as there are real consequences. "Private" isn't some magic wand that will solve problems. If you take a government run monopoly and turn it over to a privately run monopoly, you aren't going to see much improvement.
You need to ask yourself your own question. Competition works out really well for so many things that you take for granted here. And instead you cherry pick one small aspect of one industry that you feel supports your opinion.
It is in some ways a tough question. If Wikipedia says your organization was founded in 1999, and it was founded in 1989, shouldn't you edit it? What is a donor supposed to do when there is an inaccuracy like that? I guess the point of the article wasn't the quality or accuracy of the edits so much as the ignoring of the terms of service at the time, presumably implying that the donations incurred immunity. It is unclear if non-donors received a higher level of reaction to the same thing.