One reason that HFT is disliked is that it gives disproportionate advantage to the big players who put in the high speed infrastructure and equipment. This means that a few companies are able to extract profits from the market by simply spending the most money up-front.
Now obviously markets are not zero-sum games, but there is theoretically only a certain amount of growth returns available and some of this is being siphoned off. Couple this with the idea that the purpose of the markets are to most efficiently distribute capital to where it can be best used in the real world, HFT does not seem to be improving much.
Traders don't "game markets" for profit. They're part of the infrastructure that makes markets work. It's like saying E-Bay "games markets for profit" because they take a piece of every transaction. Being an intermediary != gaming the market.
The European Parliament has called for changes to EU law to stop food price speculation that has been linked to the famine that has claimed tens of thousands of lives in East Africa.
A hard-hitting resolution adopted by Euro-MPs on Thursday 15 September calls for changes to EU directives on market abuse and financial trading to stop "abusive speculation" which has been identified as a contributing factor to the current famine in the Horn of Africa.
While it is widely accepted that the humanitarian emergency in the region was triggered by drought, a recent World Bank report identified high food prices as a key contributing factor.
Academics and international development charities working in the sector believe that food price volatility caused by speculation in agricultural derivatives on the financial markets are exacerbating the situation.
How does what happen? A drought led to reduced supply and higher food prices. That's exactly what you'd expect in an efficient market. People blame the traders because they're the mechanism through which the market incorporates the fact of the drought.
You see the same crap-throwing with traders in oil. People blame the traders for "bidding up" oil prices. The traders are just helping the markets reach a price--it's the market that's bidding up oil prices. And that's exactly what you'd expect when India and China are guzzling up the stuff but production has been flat since 2005 (and we hit peak discovery in 1965...)
I know nobody wants to pause their high-speed HN binge for the seeming eternity it takes to listen to a podcast, but I promise you will not regret this one.
