Is Wall Street out of control?
Main Street and Wall Street are abuzz over Flash Boys: A Wall Street Revolt, the new book from Berkeley-based journalist Michael Lewis (author of Moneyball and The Blind Side, London School of Economics graduate and former bond salesman).
Flash Boys makes a couple of bold conclusions, which the media have had a field day with. One, Wall Street is rigged. Two, the little guy can’t win. To put it less sensationally: high-speed traders have a marked advantage on Wall Street, one that the little day trader (and even the astute money manager) can’t equal.
Can the individual investor still win? If you define “winning” in terms of day trading, maybe not; if you’re in the market for the long run, it is still quite possible to grow wealth through equity investing. Millions of Americans have, and in all probability millions more will.
To seasoned investors, much of what Flash Boys has to say is hardly revelatory. While the financially semi-literate are hailing the book as a confirmation of all they suspected, the fact is that high-speed trading may have some benefits for investors (which even Lewis concedes).