This Day On The Street
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How About an Occupy New York Stock Exchange?

Clearly, the stock exchange trading model is prone to abuses. It's also obvious that stock exchanges aren't even necessary, and haven't been for a long time. The problem is that there is no reasonable alternative. Dark pools are obviously not the answer -- the occasional spasms caused by automated trading are proof enough of that.

The good news is that automation has actually reduced the opportunities for chicanery of the kind that has plagued the NYSE and Amex in the past. In fact, the increasing automation of the NYSE has resulted in a decrease in the number of floor-trading abuses since the bad old days of Oakford. But Friday's enforcement action shows that the exchanges still haven't been able to prevent their systems from benefitting the few at the expense of the many.

What's needed is a kind of balance, a largely automated market that has sufficient controls to allow for regulatory oversight. Instead of deploying cops to hassle demonstrators who are rightly outraged by the Street's depredations, it's time for the securities cops to police the really nasty stuff going on inside that building.

Gary Weiss's most recent book is AYN RAND NATION: The Hidden Struggle for America's Soul, published by St. Martin's Press. Follow him on Twitter: @gary_weiss

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