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Non-Tech : Meet Gene, a NASDAQ Market Maker -- Ignore unavailable to you. Want to Upgrade?

To: LPS5 who wrote (1245)	11/30/2000 8:32:08 PM
From: rjm2	Read Replies (2) \| Respond to of 1426

Sounds like you have a problem with Dateks empowering the little guy. I appreciate the fact that I can improve the best bid or offer and improve the chances that an uneeded 3rd party (MM) will not jump ahead of my order by a penny or whatever. My solution ? A national limit order book. Abolishment of payment for order flow and EVERYONE on a level playing field. This means if Aunt Jean was first in line at a specific price, then Aunt Jean will be the FIRST one to get filled at that price or better. I think we are heading in that direction...it will just take time.

To: LPS5 who wrote (1245)	11/30/2000 11:48:29 PM
From: Dan Duchardt	Read Replies (1) \| Respond to of 1426

LPS5, Calling it a "tax" merely endeavors to use a word with a broadly negative connotation to distract from the fact that a $20 bid or offer posted on an ECN or ATS, when accessed via SelectNet, is not in fact "$20." A $20 bid is a $20 bid is a $20 bid, but hitting a $20 bid will never buy any of us a share of stock for $20. Whatever term you choose to call it, the effect of the scheme proposed by Nasdaq is to give execution priority to dealers by demanding that the FEE charged to access an alternative and often superior execution path be misrepresented as part of the share PRICE. Fees charged by ECNS are no more related to share price than are brokerage fees charged to investors to gain access to the market. In fact, although a brokerage firm is obliged to pay the fee for accessing an ECN via selectnet, there is no obligation I know of to pass that fee along to the investor/trader. Fees are fees, and stock prices are stock prices, and mixing the two is, IMHO, entirely inappropriate. Investors can choose the broker they want to use where they feel they get the best value for what they pay to access the market, and if they choose a broker who passes on ECN FEES they accept that as part of their cost of doing business. It has nothing to do with the price they pay for shares of stock. Dan