War On Wealth

Bizarre as both the flash crash and the conspiracy to cover it up was, even more bizarre was this: What happened was obvious within hours to me and many others, presumably including many at the SEC. Nonetheless, almost everyone in the industry, led by the SEC, refused to even consider the obvious and correct explanation. The flash crash had nothing to do with Greece, the market averages, the rapid loss and recovery of $862 billion, the futures market or any of the other chaff thrown up by the SEC to draw attention away from its booboo. The flash crash happened because on May 6 the stock market was operating exactly as the SEC designed it to operate, and performed flawlessly all day long according to that design, including during those 20 minutes when trades at 1/100 of a cent were rounded down to zero and trades at $99,999.99 were rounded up to $100,000, all of which printed instantly to the SEC's mandatory transparent tape. This was radically different from how the market used to operate before the SEC's electronic reforms created high frequency trading. And the industry, peopled by those who wanted to keep their jobs and could not afford to challenge the SEC, helped the Commission circle the wagons around its disingenuous cover-up. That true story is what this book is about.