Almost Classical

On April 18, 2014, the city of Providence, R.I. , added to the growing list of lawsuits against exchanges, brokers, and HFT specialists. This demonstrates the power of narrative. The Lewis book,  Flash Boys: A Wall Street Revolt , contains nothing new, no breaking story or previously unpublished information. But, Lewis' ability to tell a story and tell it well compels politicians to respond. Remember, state attorneys general run for office; public officials remain politicians, not mere lawyers. As the media and voting public demand action, the financial industry faces growing pressures. This happened with tech stocks (how VC were taxed), the home lending industry, and now HFT. Laws pass on emotion, seldom offering good solutions to perceived problems. The lawsuits relating to HFT will culminate in regulatory changes, if not outright wins in court. http://www.reuters.com/article/2014/04/18/highspeed-classaction-idUSL2N0NA0XC20140418 (Reuters) - Dozens of the largest U.S. stoc...

Republicans are shouting that President Obama has acted "unconstitutionally." The Democrats respond that the GOP merely dedicated to obstruction. And the truth is… (in my opinion) they are all schmucks. President Obama's recess appointments to the National Labor Relations Board and the Consumer Financial Protection Board are legally questionable, but the real problem is that the appointments continue an already lousy practice that is outdated. This week the President is claiming that he can make recess appointments because the Senate session is currently a "sham" procedural move by Republicans. The Senate, we all know, is really on vacation. But, only weeks earlier, the non-present Senate conducted serious business and he was more than willing to accept arcane Senate parliamentary tricks. In December of 2011, the U.S. Senate and House approved a two month extension to current payroll deduction rates. Only a handful of legislators, not even a third, were in ...

With the end of the recent Supreme Court term and some of its more ludicrous decisions, I thought it was time to reread the Bill of Rights to see if I missed something the Court was able to see. After carefully reading the document, which is elegant in its simplicity, I don't think I'm the one confused. How could nine highly-educated lawyers twist such simple words? Because they can rely on previous ignorant and/or stupid rulings to justify not ruling based on the words in the document. Amendment IV In the last few years, the US Patriot Act and other well-intentioned but misguided laws were passed to protect us from terrorists foreign and domestic. Unfortunately, many of these laws have been upheld by a court system unwilling to enforce the Fourth Amendment: Amendment [IV] The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable caus...