Wall Street is embracing its dark side and “Dark Pools”

In a New York Times article today, a very disturbing reality about what is really going on with Wall Street and 40% of trades that are not being reported. They call them “Dark Pools”. This article reinforces my belief that all Americans should have a Tentonomics strategy somewhere in their minds. Millions may need it if we have another crash..

Excerpts: “As the stock market continues to climb, trading has increasingly migrated from established bourses like the New York Stock Exchange to private platforms, including dark pools, that are largely hidden from public view. The shift is helping big traders hide what they are doing in the markets, and regulators are worried that the development could obscure the true prices of stocks and scare away ordinary investors.”

Dark pools, like public exchanges, give investors a place to connect with buyers and sellers of stock, but the pools are subject to less stringent regulations than public exchanges. Often run by big banks, dark pools do not require buyers and sellers to publicly announce their intention to trade stocks, allowing traders and investors to hide behind a veil that only the operator of the pool can penetrate.

That appeals to a pension fund that wants to buy a million shares of Ford stock, for instance, because it allows the fund to avoid tipping off competitors who could push the price of the stock up.

For the full article see : http://www.nytimes.com/2013/04/01/business/as-market-heats-up-trading-slips-into-shadows.html

If you read it, I’d like to personally know what you think and how it might apply to others you know. Comment here if you want – Thanks..

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