A GOOD FIRST STEP

A transaction tax may be the best answer to this rent seeking but it's a move in the right direction.

Financial regulators tame cheating ‘cheetah,’ fine, ban high-speed trader
By Kevin G. Hall | McClatchy Washington Bureau
Posted on Monday, July 22, 2013

The action by the Commodity Futures Trading Commission said Panther Energy Trading LLC and its principal, Michael J. Coscia, used a computer algorithm to illegally place and cancel orders at head-spinning speeds. The practice is known as spoofing and is designed to trick other market participants.

The move marked the first time regulators used new powers to combat disruptive trading practices that were granted by the 2010 revamp of financial regulation called the Dodd-Frank Act. The action , which includes a penalty and a yearlong trading ban, puts the regulatory focus on a growing and controversial segment of financial markets: the high-speed traders who are armed with technology more sophisticated than that used by the government cops who police markets.