This week, the “Masters in Business” radio podcast features Brad Katsuyama of IEX who is probably best known to the public for his role in Michael Lewis’ book Flash Boys.
In our extended podcast, Brad explains the puzzle that HFT was presenting to institutional traders: By 2007, something had changed in the market structure, but no one really knew what it was. He explains how he and his team became detectives, eventually unravelling the impact that was algo-driven High Frequency Trading.
Michael Lewis first started speaking to him on background, in order to learn more about HFT. Eventually, he figured out Katsuyama was the main character in this mystery.
We chat about his appearance on 60 Minutes, and the infamous debate on CNBC with the William “Bill” O’Brien, the CEO of BATS exchange. The NYAG forced BATS to correct O’Brien’s public misstatements; he left the firm a few months later.
The weekend is here! Pour yourself a steaming hot mug of Jamaican Blue Mountain, and enjoy our longer form reads: • China’s Plan for Winning the Currency Wars (Bloomberg View) • Can hipsters save the world? (The Guardian) • The crazy, true-life adventures of Norway’s most radical billionaire (Fortune) • Anatomy of a Hack: A step-by-step account of an overnight…Read More
Category: Financial Press
The Euro-Dollar Riot! David R. Kotok, Cumberland Advisors, March 13,2105 We open this commentary by trying to simplify a very complex trade. Think of yourself as the corporate treasurer of a midsized American company. You have your basic business activities in the United States, and you have several divisions in Europe. Over the…Read More
Succinct Summations for the week ending March 13th: Positives: 1. Initial jobless claims fell to 289k vs estimates of 305k. 2. CPI in China rose 1.4% y/o/y, higher than expected. 3. NFIB small business optimism index came in at 98. 4. MBA purchase applications rose 1.9%. 5. Import prices fell 9.4% y/o/y, a win for…Read More
Between a Tweet and a full column is a netherworld where ideas often get lost. Rather than let these tweener concepts slip through the cracks, now and again I like to gather them in one place (see, e.g., this) — if only to see if any discernible patterns emerge. Here’s my latest run of random ideas: 1. Is there a shortage of A-rated…Read More
Form Strategas by way of Art Cashin of UBS: Everything old is new again. Here’s an interesting surprise from Jason’s people at Strategas, courtesy of my good friend and remote FoF member, Alan Battles of Salt Lake City. (Fed statements 2004.) Please note the “patient” in the March statement.
Category: Federal Reserve
The week is over already? How did that happen so soon! No worries, we have your artisanal morning train reads: • The Strong Dollar Is Weighing On Major U.S. Exporters (Real Time Economics) see also The Crashing Euro Is Great for American Tourists. But What About the American Economy? (Slate) • On its 1 year anniversary, Michael…Read More
Category: Financial Press
Gorgeous car — the same goofy color as my Jeep Rubicon — but fantastic lines despite being ~47 years old. Source: Classic Driver
Do Lower Gasoline Prices Boost Confidence? Aditya Aladangady and Claudia R. Sahm FEDS Notes, March 6, 2015 A gallon of gasoline currently costs one third less than it did last summer, as shown by the solid line in Figure 1. Gasoline makes up 5 percent of average family spending, so lower prices at the pump…Read More