Flash Trading Banned
Asian markets closed marginally lower on indications that credit crunch is returning. Nothing major jet, but worth of giving some thought on that, especially having in mind recent decrease in US bank lending and falling monetary aggregates. Indication how excess liquidity isn’t finding its way to real economy. Doubts on the strength of recovery still remain. Bloomberg story: Aiful to Seek Debt Reprieve as Refunds Roil Consumer Lender.
The story of the day is definitely the ban on flash trading. Reuters story: U.S. regulators propose ban on “flash” trading. We will see now will the lack of flash orders indirectly prove conspiracy theories that proprietary desks (Goldman Sachs mainly) are earining excess profits and are responsible for shooting the market so high.
Nice summary on recent Societe Generale strategist Dylan Grice analysis. Reuters story: China’s coming magnificent bubble. Interesting theory, but it is more futuristic than economic.