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Friday, May 6, 2011

The itsy bitsy $SPDR went up the water spout. It's okay now, the spout is clear...

The itsy bitsy $SPDR went up the water spout.
Down came the flash crash pain, and washed the spider out.
Up came the Bernank, and dried up all the pain,
and the itsy bitsy SPDR went up the spout again.

Happy Anniversary Flash Crash

Themis Trading, LLC
By: Joe Saluzzi

There has been much hype this week about today’s Flash Crash Anniversary.  We have certainly contributed with some comments about what we think has not changed and how we think another flash crash could happen again.  But up until now, the pro-HFT, status quo crowd has been pretty quiet.  Guess they think if they don’t call attention to it, then maybe the critics will just go away.  Well, apparently, they couldn’t hold out any longer and we have been treated with some quotes from the “don’t change anything or I’ll take my liquidity and go home crowd”.  We will first post the pro-HFT comment and then offer the Themis translation.  First we have the COO from the CME Group making some comments read article here.

Comment: “The SEC came in quickly with the circuit breakers proposal and was implemented in record time”

Translation: The public thinks they are protected know from flash crashes but the current circuit breakers only cover the Russell 1000 stocks and some ETF’s

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