May 21, 2011
Copyrighted material redacted. Author cites:
http://www.securitiestechnologymonitor.com/news/nasdaq-facebook-technical-glitches-not-finest-hour-30600-1.html
they traded without prices? oh, that is bad. only one side would be able to get THEIR price - the marketmakers. this is the problem with the market. the marketmakers can "see" the orders before they are put on the floor. who makes $ in this market? the marketmakers. why do you think the banks, etc., want to preserve their marketmaker functions.
NASDAQ should not have allowed this. they should have decided not to trade, rather than allow the marketmakers to view orders AND pick prices. "uh, we'll take all the unlimited price orders first and assign a price, then we will deal with the limit orders." i have seen this type of conspiracy over and over and it should not be allowed. it is not in the investors' interest, nor the general united states interest. if NASDAQ doesn't know the difference about that, they are not representing the public interest and risk closure as being a front for brokers and dealers because they are functioning as a "dark pool" but representing themselves as an exchange. in a dark pool, it appears that one side of the transaction doesn't have information but the other side of the transaction has all the information. oh, yeah, and your broker can be the other side of the transaction, in other words, shorting against YOUR order.
if you don't know what a dark pool is, http://www.investopedia.com/terms/d/dark_pool_liquidity.asp?q=dark%20pool#axzz1vWHutRNm
now, a large share of the orders are moving through "dark pools".
http://www.bloomberg.com/news/2012-03-01/dark-pools-capture-record-share-of-declining-u-s-equity-volume.html
Copyrighted material redacted. Author cites:
http://www.investopedia.com/articles/basics/03/103103.asp#ixzz1vWIDhcE4
(investopedia is a very good source of information about definitions in the financial market.)