The hounds are tracking Goldman Sachs. [View All]

[seafan]

Seriously ugly information at Kos:

"Incredibly Shrinking Liquidity" as Goldman Flushed Quant Trading, July 7, 2009



After wading through the massive compilation of information, a few posters' comments sum up the substance of what Goldman may be pulling off:




From Kos poster RenderQT:

Abridged version:


1. GS developed high end algorithms that could track and predict market movements based on historical data

2. GS has the capital to invest in ultra high-end equipment to run their data sets

3. GS also has their system on the actual network at NYSE

4. With the best equipment and algorithms right on the nexus of the NYSE, GS would be able to "front run" the entire market

Ta-da!

From Kos poster Ezekial 23 20:

GS, through access to the system as a result of their special gov't perks, was/is able to read the data on trades before it's committed, and place their own buys or sells accordingly in that brief moment, thus allowing them to essentially steal buttloads of money every day from the rest of the punters.

Two things come out of this:

1. If true, this should be highly illegal, and would, in any sane country result in something like what happened to Arthur Andersen after it was found out they were deliberately helping clients shred evidence.

2. NEVER place 'market' orders. Always set your buy/sell prices. Market orders are just begging for somebody in the chain to steal money from you.

From Kos poster skrymir:

Yep. It's just high-tech frontrunning.

The simplified version is that GS has access to the network where the pre-transaction communication takes place and is using that information to frontrun the market. Frontrunning used to be done mostly by brokers and specialists who had access to the order information prior to the execution of the trades - they would then either buy or sell for their own account before the real trades occurred, accruing a small profit on each transaction. Looks like GS is doing the same thing, only with high speed computers. This is illegal on every exchange that I know of. So when are the indictments coming?

Yes, that's what we all want to know.


Goldman Sachs has been ripping this country off since the Great Depression.



With the very recent news that a Goldman insider has been arrested for theft of proprietary computer code that may be "The Secret Sauce" that Goldman Sachs used to rob the entire market...... (Hey, if elections can be rigged with secret software, why not the entire financial system?)


It is time this cancerous mass is destroyed.





zerohedge and http://trueslant.com/matttaibbi/">Matt Taibbi have their noses to the ground. Stay tuned.