'I only tried my best'

[AtW]

The snag is if there was Worldwide agreement to impose an artificial delay of say a second

You only need to force big exchanges to implement it - UK, USA and Germany: it should be a requirement of operating an exchange in the interests of all market participants rather than handful who want to exploit the rules to gain unfair advantage.

Other way is to tax transactions - this will make it impractical to do many trades:

"The European Commission has backed plans from 10 countries to launch a financial transactions tax to help raise funds to tackle the debt crisis.

The 10 countries include France, Germany, Italy and Spain."

BBC News - Financial transaction tax for 10 EU states

I would expect them to tax any transactions made from UK or USA to their banks/exchanges. Those who don't like it should not expect to trade with those countries, simples.

[d000hg]

Why a kid is allowed to bet billions in the first place?

Why any single person can do such things in a big bank in the first place?

Someone has to make the decision.

[centurian]

Just how much of the £1.50 per liter petrol price is due to those kids playing up the market? Probably a lot because just 10 years ago oil was worth 10 times less than it is now (even though due to high taxes in this country the end sell price was only half current amount).

So given that tax accounts for about 60% of the £1.50 - and that 10 years on, we have much higher demand for oil - for something that has a finite supply - and increasing cost to extract what little supply is remaning.

Traders may be able to influence the price a bit - but to say that "those kids" amount for a "a lot" of the cost of the £1.50

[AtW]

Traders may be able to influence the price a bit

They are the ones who'd benefit most from it and they are doing their best for sure.

Recently one unknown trader/company accounted for like 10% of share quotes using HFT software - turns out putting up quotes does not even cost any money on exchanges, yet mere presense of quotes can be used by others to judge what the fair price is.

Bottom line is that there is no economic sense in HFT to anybody other than people who take advantage of it at the expense of other market players.

The price of things on exchange should NOT be decided by SupremeSpod's ability to get his VB 6 code run a bit faster.

[AtW]

Someone has to make the decision.

Not anymore - in their quest for quicker trades they delegate it to machnes, sometimes the creators feel the pain too:

This Is What Happens When An HFT Algo Goes Totally Berserk And Serves Knight Capital With The Bill | ZeroHedge



What annoys me most is that they keep calling this gambling as "hedging", FFS - it's not!

[centurian]

What annoys me most is that they keep calling this gambling as "hedging", FFS - it's not!

Ah, well that's where we get back to the subject of this thread - Mr Adoboli.

The reason why UBS lost so many zero's was down to being unhedged trades. UBS thought their positions were a lot stronger because the hedge positions that Adoboli said he had taken out, would have covered any losses on the trades - except he didn't hedge - why - because a proper hedge will always significantly reduce your profits..

[AtW]

The reason why UBS lost so many zero's was down to being unhedged trades. UBS thought their positions were a lot stronger because the hedge positions that Adoboli said he had taken out

No.

UBS lost so much money because they had tulip for brains to trust some kid making billion dollar "investments".

Further more they lost so much money because they got into gambling in the first place - it was just a matter of time before it happened.

It's amazing that Swiss banks got into this tulip - instead of focusing on their core competency - keep money safe from tax offices around the world.

[EternalOptimist]

No.

UBS lost so much money because they had tulip for brains to trust some kid making billion dollar "investments".

Further more they lost so much money because they got into gambling in the first place - it was just a matter of time before it happened.

It's amazing that Swiss banks got into this tulip - instead of focusing on their core competency - keep money safe from tax offices around the world.

It's not as if these were public funds AtW, this was a privet hedge

[centurian]

No.

UBS lost so much money because they had tulip for brains to trust some kid making billion dollar "investments".

Further more they lost so much money because they got into gambling in the first place - it was just a matter of time before it happened.

It's amazing that Swiss banks got into this tulip - instead of focusing on their core competency - keep money safe from tax offices around the world.

But if this kid had done as instructed - and properly hedged his trades, like he was told to do, they would would have lost millions instead of billions.

Their mistake was trusting that he had properly hedged - especially during times when he made tulip loads, because it's very difficult to make large sums of money when propertly hedging. When was the last time you heard of a trader being fired for making too much money

[AtW]

it's very difficult to make large sums of money when propertly hedging.

Exactly!

Hedging isn't meant to make profits but to save oneself from big losses, this is like insurance and just like with insurance it should be expected to cost money.