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Strategies & Market Trends : After Hours Trading(ECN)-The Coming 24/7 Trading Explosion -- Ignore unavailable to you. Want to Upgrade?

To: brec who wrote (37)	4/9/1999 2:27:00 PM
From: Lola	Read Replies (1) \| Respond to of 314

To get realistic answers to your questions, you should study how the Toronto Stock Exchange works. They do not seem to be suffering too much because they have a completely electronic system. The Toronto Stock Exchange is justifiably one of the most respected stock exchanges in the world. As for re-educating the investors out there, I think they are alot smarter than the "investment community insiders" are willing to give them credit for. Hell if the regular guy can figure out that the current system is screwing him, I think he can learn the difference between market orders and limit orders (if he hasn't already). The only thing having market markers in the system seems to ensure these days is that your investment will immediately be worth less than what you paid for it. Is that a convenience or an inconvenience? I say that's a huge inconvenience. Having experienced a truly electronic system for most of my investing career, I find the current setup in the US to be quite difficult to accept. I just don't understand why Americans tolerate it. It is the equivalent of buying stocks retail. You can't immediately sell it for what you just paid for it. That's not convenient. The so called "liquidity" which you say your market makers create does not offset the losses suffered due to the MM system. Perhaps your current system would work better than it does if the MMs weren't such criminals. Having MMs is a good idea if it works, but in my opinion it is failing miserably. If it doesn't work, you must fix it. I am sad to say that I find the US stock trading system to be more in line with some third world countries than that of a super power. It's disgusting and a real deterrent to foreigners putting their money in American stocks. Lola

To: brec who wrote (37)	4/9/1999 5:31:00 PM
From: Richard L. Williams	Read Replies (2) \| Respond to of 314

Without market participants who undertake a responsibility for providing liquidity, the "regular guy" who wants to buy or sell a few shares of Podunk Steel & Bagel is going to have to become accustomed to some trading inconveniences. Good point, Brec...but then you have the flip side of the coin. I own a stock that has a float of two million shares. There are 2,400 shareholders, meaning that each owns less than 1,000 shares, on average. I own much, much more than that, and know others that have even more than I do, so I know that most "little guys" out there are holding very small lots of this penny. The stock (HTSF) began a runup in January from 20¢ to $1.75. During this time, there was a reasonable amount of selling, but nothing to match the buying of over 1.5 million shares during 1/15/99 to 2/16/99. If I had to guess, I would suspect that few, if any, of the small shareholders were selling, leaving the relatively few large shareholders to do the selling, half of whom did, the other half holding. We now suspect that the MM's for our stock are short more than 1/2 the float of this stock, and going shorter by the day. What this has resulted in is MM mind games, and blatant manipulation as the MM's try to instigate selling, and get the stock down to a lower price to limit their liability. If the MM's were replaced by a computer, then would this situation have come about? Or would the computer have set the bid at $10, attracting sellers, but no buyers? Are the MM's, by going so severely short, doing their part to make for an orderly market, and I should just accept their hijinks as par for the course? Not sure how the computer system would work, but I can't see a computer using psychology to frighten people. <g> Rick Williams