Speedy Traders in Talks on Tie-Up

From WSJ: Two of the largest independent U.S. high-frequency-trading firms are in early merger discussions, as a downturn in trading opportunities has spurred cutbacks and tie-up talks among rivals.

RGM Advisors LLC and Allston Trading LLC have discussed a deal that would combine their respective strengths in automated stock trading and futures markets, according to people close to the talks…..

Read all about it at http://online.wsj.com/article/SB10001424127887323836504578553662434691152.html

Roubini, Bremmer: the Fed policy that’s going to implode

 “Be sure your seatbelt is fastened, because nothing has really come to rest. We have entered the New Abnormal, a period in which every market assumption must be questioned and the wise investor is prepared to be surprised.”

And that’s how famed economist Nouriel Roubini and Ian Bremmer, the president of Eurasia Group, launch into an eight-screen Institutional Investor assault on all that’s going wrong with the global economy right now and on how new crises are most certainly headed our way….

http://blogs.marketwatch.com/thetell/2013/06/18/roubini-bremmer-and-the-fed-policy-thats-going-to-implode/

Is High-Frequency Trading Bad For Profits, Including High-Speed Traders?

From HuffPo:  High-frequency trading is bad for everybody, including high-frequency traders, according to new research from a university that produces economic reports that are sold early to high-frequency traders.

The study, by the University of Michigan's engineering department, focuses on one particular tactic of high-speed trading, known as "latency arbitrage."  This is the practice of gaming the split-second lags between the time trades are made and the time those trades are crunched by a central clearing house called the Security Information Processor into a price quote called the National Best Bid And Offer. Traders with super-fast computers can calculate the NBBO faster than the Security Information Processor can do it, and they take advantage of the tiny gaps between the old NBBO and the new NBBO.

The researchers say this trade somehow reduces the total amount of profits in the system -- in other words, it not only hurts regular, slowpoke investors, but also other high-speed traders. Whatever profit each individual robot makes on a latency arbitrage trade is less than the amount of profit that is destroyed by the practice, according to the report. This is just more evidence that zapping thousands of trades per second does nothing for society….

More?  Check out http://www.huffingtonpost.com/2013/06/18/high-frequency-trading-profits_n_3459497.html?utm_hp_ref=business

Dr. Doom: Fed Exit Strategy Will Be 'Treacherous'

From Yahoo Finance:  As the Federal Reserve's Open Market Committee begins a two-day meeting , economist Nouriel Roubini and political scientist Ian Bremmer warned that the Fed's monetary easing exit strategy would be "treacherous" and would lead to financial instability.

"We know how the movie ended, and we may be poised for a sequel. The weak real economy and job market , together with high debt ratios, suggest the need to exit monetary stimulus slowly. But a slow exit risks creating a credit and asset bubble as large as the previous one, if not larger," they wrote in a report published in Institutional Investor magazine.

In the report, they warned that market complacency among politicians, investors and central banks was leading us into a "New Abnormal" era - a "period in which every market assumption must be questioned and the wise investor is prepared to be surprised…."

http://finance.yahoo.com/news/roubini-fed-exit-strategy-treacherous-073247994.html

Google settles investor lawsuit over stock split

From Bloomberg:  Google Inc., operator of the world’s largest Internet search engine, settled a lawsuit on the brink of trial over a plan for a stock split that shareholders claimed would unfairly allow founders Larry Page and Sergey Brin to strengthen their corporate control.

Lawyers for a Massachusetts pension fund and other investors were scheduled to begin presenting testimony Tuesday in a Delaware court about a stock reclassification that would create a new class of nonvoting shares, court filings show.  The settlement, which must be approved by a judge, clears the way for the split, which had been on hold while the Delaware case was being litigated. The accord provides enhanced board scrutiny of Page’s and Brin’s requests to amend restrictions on their sales of new Class C shares and on company acquisitions funded by more than 10 million shares of the new stock, according to court filings…

More/  Check out http://www.thestar.com/business/economy/2013/06/17/google_settles_investor_lawsuit_over_stock_split.html

Obama: Bernanke Has Been at Fed ‘Longer Than He Wanted’

From Bloomberg:  President Barack Obama said Federal Reserve Chairman Ben S. Bernanke has stayed in his post “longer than he wanted,” one of the clearest signals the central bank chief will leave when his current term expires next year.

 “Ben Bernanke’s done an outstanding job,” Obama said in an interview with Charlie Rose that aired yesterday, when asked about nominating him for another term subject to Senate approval. “He’s already stayed a lot longer than he wanted or he was supposed to.”  Obama likened Bernanke’s tenure to that of outgoing Federal Bureau of Investigation Director Robert Mueller, who stayed on for two years after his term expired in 2011 and is leaving his post in September. Bernanke’s second four-year stint at the central bank ends Jan. 31.

http://www.bloomberg.com/news/2013-06-18/obama-says-bernanke-fed-term-lasting-longer-than-he-wanted-1-.html

And Now For Something Completely Different: Headhunter for the New York Rich Turns on Them

Adrian Barrie Smith, a British recruiter who supplies butlers, maids and other domestic workers to some of the world’s wealthiest families, has turned on former clients, Andrew Ross Sorkin writes in the DealBook column. “Over the last 18 months, Mr. Smith has filed lawsuits against the families of some of the most prominent names in finance, including Stephen A. Schwarzman, the chairman of the Blackstone Group; Carl C. Icahn, the activist investor; Leonard Blavatnik, the Russian investor who recently acquired Warner Music; Howard Lutnick, the chairman and chief executive of Cantor Fitzgerald; and George Soros’s former wife, Susan Soros Webber.” Mr. Smith often accuses his clients of some form of breach of contract, with complaints about age and race discrimination. His targets view it as mudslinging or even extortion.

“I could tell you stories that you simply would never believe,” Mr. Smith told Mr. Sorkin in a recent e-mail. “Who sits in the private planes and homes, dinner parties of the elite? The butlers, the nannies, the housekeepers.” He added, “And who do they e-mail, and tell all the gossip to? Me….”

To find out more check out http://dealbook.nytimes.com/2013/06/18/fraud-charges-for-former-ubs-trader/