Lewis is not the first to cry foul on these strategies

A small group of financial firms are using their technological superiority to skim the top off the market, Michael Lewis claims in his new book "Flash Boys." There's an increasingly heated debate over whether the practices, known as high-frequency trading, are harmful or helpful. Lewis, for his part, says the market is "rigged," and several federal agencies, including the Department of Justice, are now looking into what Charles Schwab recently labeled "a growing cancer."
Sophisticated and expensive puters allow high-frequency traders to take advantage of minuscule differences in price among the many exchanges where securities are bought and sold. Some firms pay to place their puters on the site of a stock exchange to be sure their access to price data is as fast as possible,Toyota Lexus Smart Key Programmer for 2009~2012 Smart Key a practice known as colocation; others will use technology to obscure their trading intentions for a few crucial thousandths of a second. Lewis's book tells the story of Brad Katsuyama, a former trader at the Royal Bank of Canada in New York. Katsuyama opened a new stock exchange last year to give investors protection from HFT.

Lewis is not the first to cry foul on these strategies. Eric Scott Hunsader, the founder of Nanex, has made himself immensely unpopular in some circles for his outspoken and persistent criticism of HFT, which he first encountered during the "flash crash" of 2010. Bloomberg called him the "nemesis" and "scourge" of the HFT world.I asked Hunsader to talk about the book, the new stock exchange, and his long career in financial technology. The conversation focused on the Securities and Exchange Commission ruling in 2007 that allowed what we now know as high-frequency trading. The transcript, edited for length and clarity, is below.Wonkblog: When I was a kid,MB Dump Key Generator from EIS Super SKC Calculator I can remember my grandpa showing me how to look up stock prices in the newspaper. And there were exactly three exchanges. Oftentimes the prices were in fractions one-eighth, three-quarters, and so on. And then, it wasn't long after that that I was showing him how to look up stock prices online. I'm wondering if you can talk about the transition into electronic trading -- and you think that at least initially, it was good for everybody. Is that right?Eric Hunsader: Oh yes. Definitely, just like puterization improved the efficiencies of all industries, the same thing happened in the beginning.