Flash Crash, Goldman Sachs & Bitcoin
Flash Crash, a story of the mysterious market crash in 2010, describes events related to the trading of S&P500 futures, the effect of high-frequency trading, one man's attempt to fight back & the legislative challenges of regulating a market in an era where technology and algorithms dominate. There is one conversation, which takes place during a Senate Banking Committee hearing, included in this book which is of critical importance to the surrounding discussion, between Senator Jack Reed and the Chair of the SEC, Mary Schapiro: Senator Reed asks: " The presumption of most people who own a few stocks is that the value of stocks, the liquidity of stocks is directly a function of their economic value, the same thing with debt instruments and derivatives. One of the issues we have to deal with is, with the proliferation of these algorithmic, high-frequency traders, some of these algorithms don't take into account the fundamentals of the instr...