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Last week  I was asked who is in charge ?  Massive fines but sadly no order of command ! 

Recently exchanges have been seeking more autonomy , greater profitability and therefore greater power  ................. THEY  have now stated that "only exchanges  should be voting members in committees  !" 


 The last decade exchanges have moved from not profit organisations to For profit and have held back nothing in pursuit of a new member/ liquidity or pursuit of new  volume . This status has totally struggled to maintain their "fair & orderly status " New strands of rebates , market making , co - location and  HFT  are now all part of the debate .  Recent arguments have fairly criticised the exchanges  self regulatory authority,which gives exchanges the powers  to maintain  "fair & orderly markets " in the absence of an government regulator  . This  is interesting as certain court cases prove .........Navindar Sarao appears to have "spoofed " a fortune over a decade  un interrupted by any exchange !  This appears that exchanges  to be  allowing abuse and manipulation than attempting to stop it . Sarao was a very large liquidity provider and a profit source for many an exchange .

The Cattlemens Beef association are totally correct in complaining about their futures market , especially to volatile limit price movements, and now struggle to have a hedging  tool to protect their business ; sadly CME appear to have sided with HFT rather than the retail trader ! Alarm bells should be ringing  . Recent fines from the french regulator of $5 million euros to both Virtu financial and the Paris euronext exchange proves exchanges need as much supervision as traders !  Virtu 96% cancellation rate cannot be a useful tool to retail trade or even to real liquidity  ? Previous old traders , Paul Rotter , claim  Eurex exchange allowed his spoofing and layering trades as it increased volume & liquidity ; 150 K  round turns a day justified  his trading . This only proves that exchanges are in need of serious market supervision and hopefully common sense may prevail and an independent regulator appointed ASAP .

       Sadly this will not happen as funds are lacking despite massive fines being imposed . Last week CFTC , Timothy Massad ; at a budget hearing  stated that his agency does not have the monies available  to inspect firms or exchanges it regulates ; or to pursue all the enforcement cases it would like including spoofing or metal scams .                                                                                                                       I struggle with Tim Massad  ; as if I were a bank would  I tell a bank robber that the alarms were turned off ? Most market abusers  are aware when they can both abuse and gain most profit and normally when regulators were  asleep  . Finally Massads costing looks stolen as recently billions of $ of fines appear to have been misplaced and a % not returned to improve beating or controlling market abuse . Hopefully governance will oversee a very narrow view from our echanges ? 


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