Is Wall Street a rigged game? Michael Lewis thinks so, and the financial writer’s new book blasts the so-called high frequency traders he says are gaming the market.
“Flash Boys: A Wall Street Revolt” explains how several insiders discover these firms are gaining an advantage over others: lightning-fast trades achieved through automation and advanced computer networks.
“The United States stock market, the most iconic market in global capitalism, is rigged … by a combination of the stock exchanges, the big Wall Street banks and high-frequency traders,” he said in an interview with CBS’ “60 Minutes.”
The victims, he said, are “everybody who has an investment in the stock market.”
“The insiders are able to move faster than you and play it against orders in ways you don’t understand,” Lewis said.
The high-frequency trading industry has seen less scrutiny than other parts of the financial system, but regulators are turning their attention to it. The New York attorney generalhas pushed back on firms that feed high-frequency traders. They’ve also looked into — and even shut down — paid subscription services that feed financial results directly into the traders’ computers.
Source: CNN Money