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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 (56)	4/10/1999 10:06:00 AM
From: Richard L. Williams	Read Replies (2) \| Respond to of 314

If you mean a computerized MM, backed by cash, I withdraw the question (although such a program which set a bid of $10 in this particular case would run out of cash pretty quickly :) Good morning, Brec- It's clear to me that a computer MM is a concept I don't fully understand. Perhaps I don't fully understand the process as is stands now. But in my case, it seems to me that there is little stock for sale at ANY price. The people that own the stock have bought it for the long haul, and do not watch the day-to-day undulations of the market. But if the human MM were to play this situation straight, what could they do? They have no stock to sell, hence the buyers must be turned away, correct? MM's don't make money if transactions don't occur...so they fill buy orders, betting that some owners of the stock will see the light (profit) and sell. But the stock is heavily fragmented into such small lots that even $5/sh doesn't move many people to sell. Suddenly, the MM's look and see that they have handed out a million+ shares of fictional stock now valued at $2.50 to $3....they are liable for that debt, and even if they won't need to cover immediately, they don't want this Sword of Damocles hanging over their heads. They start "shaking the box," trying to frighten people into selling, and walking the bid/ask down on the slightest pretense to further entice/force selling. I object to two things here: The short situation, and the MM's tactics that are used to try to relieve it. As I understand it, a computerized MM would not allow this situation to occur in the 1st place....at some point, a buy order would have come in, and the computer would have told the buyer, "Sorry, no shares available." On the one hand, my stock might have stalled at the 75¢ level....too, buyers would have likely gone elsewhere with their money rather than fuss with my stock. I can see how MM's may actually have helped us...at the same time, their mind-games are painful to endure. I welcome any change with open arms, methinks. Rick

To: brec who wrote (56)	4/10/1999 10:18:00 AM
From: Lola	Read Replies (2) \| Respond to of 314

You cannot make a proper comparison until you have fully experienced both systems, the fully computerized system and the MM system. They are VERY different. As a person who has experienced both systems as a trader and an investor for over 5 years, I say the computerized systems wins hands down. Even in thinly traded stocks (which I also have alot of experience with on both systems), I would prefer always to deal with a computer and not a human. You can't appreciate how wonderful a system can be that does not involve humans (and the emotional aspect of dealing with humans) until you experience it yourself. There's no way I'm going to be able to convince you of all the benefits of a computerized system if you haven't experienced it. However I find it strange that I'm explaining the benefits of computers to a group of Americans. Americans should know all the benefits of dealing with computerized systems versus human systems. America is the birthplace of the computer is it not? America is also the home of innovation and changing things for the better. So let's do it. Lola

To: brec who wrote (56)	4/10/1999 10:40:00 AM
From: Impristine	Respond to of 314

hey brec RE: "The job of a MM or specialist or more generally, of speculators, is to reduce volatility by absorbing momentary spurts of supply or demand and then playing them back over a period of time (so to speak). ================ this may be true, but the primary job is for them to make money, make money, make money, and they don't give a rats ass about momentary, bursts of volatility, supply and demand,blah blah blah...

To: brec who wrote (56)	4/10/1999 10:59:00 AM
From: Impristine	Read Replies (2) \| Respond to of 314

hi brec, for me it's not an issue of paying the price of a spread, as i will hit the bid, no PROB, i will hit the ask, no PROB, it's not a question of semantics, of what makes a market, for me, it is an even more unbiased, question, of REPRESENTATION, of EXPOSURE, being put in the back of the line, having part of your order represented, having your order butchered in to small lots, having your order put behind other orders, of other clients, with other trading histories, for me it's a question of having your order held, or your order not shown, or your order passing through some poo poo heads, hands who screws it up, for me it's a question of having a stock or option, trade through your limit price, by a large margin, and your order not get filled, and the reason you recieve is, "NOTHING DONE" "FAST MARKET" "WE DON'T HAVE TO HONOR YOUR GOOD FAITH, FIRM ORDER, IN A FAST MARKET" say what? we are sorry, even though it traded through your limit price, by a point or 3, we don't have to honor your order, because we are the market makers, we are the brokers, we own this playground, and if you don't like it, you can go somewhere else.....