Guide to Michael Lewis’ top 6 “Flash Boys” videos – Is U.S. stock market rigged?

Flash Boys cover and TOC

Flash Boys cover and TOC

Flash Boys” is a brand new (published March 31, 2014) book by famed writer Michael Lewis (author of The Big Short and Moneyball) about how the U.S. stock market is “rigged”! Yes a U.S. stock market that is “rigged” so much that big investors (managers of multi-billion dollars pension or mutual funds) to small investors (individuals that invest their own RRSP and 401(k) retirement money) are being electronically “scalped” and scammed. Without further delay, here is a guide to Lewis’ top 6 “Flash Boys” videos. Lewis has done a bunch of media appearances to promote this book. Seeing and hearing Lewis explain things in his words is a ton of fun. You will get to learn how Brad Katsuyama, a Toronto-born former Royal Bank of Canada trader, becomes the reluctant hero in this tale.

1) CBS 60 Minutes March 30, 2014 video segment: The first and most important “Flash Boys” video is the  must watch! All 14+ minutes are highly watchable, insightful, and may make you really angry once you understand some of the ways people rigged the market against investors! The last three out of four of the 60 Minutes Overtime clips add only a little bit of information and can be skipped. CBS has also provided a full transcript of the segment on the same page.

2) April 1st, 2014 live CNBC debate: The ‘epic’ debate on high-frequency trading between Michael Lewis, Brad Katsuyama and William O’Brien (BATS Global Markets exchange president) is another must watch. The debate was so heated and engaging that some traders on the NYSE exchange floor stopped to watch. (note: Some errors were made by both side and one critical factual error was important enough that BATS was forced to issue a correction on April 4th, 2014 “under pressure from the New York Attorney General’s office“.)

The reactions to the debate at the end of this Marketwatch article is worth a read too.

3) Charlie Rose (April 2nd, 2014 video): Charlie Rose did an wonderful job in this 25+ minutes chat giving viewers some great insights. Rose is seen by many as someone who sets the gold standard of conducting engaging and insightful one-on-one interview. Highly recommended. (April 22nd update: Watch full 50+ mins March 31st show on CharlieRose.com)

4) Bloomberg Television’s “Market Makers” with Stephanie Ruhle and Erik Schatzker (April 2nd, 2014 video): The fun starts early when Lewis tried to explain how the U.S. stock market is rigged using a casino example and the poker players are cheated. The hosts didn’t seem to enjoy the example when they, themselves, were set to be the cheated players!

5) Bloomberg Television’s “Bloomberg Surveillance” (April 3rd, 2014 clips): You can watch different clips from the show here, here, here, here, and here. Just wish the hosts asked Lewis and Katsuyama better questions in the show.

6) Live Talks LA – Michael Lewis in conversation with Malcolm Gladwell – Flash Boys: A Wall Street Revolt (April 10th, 2014): This will likely be a very insightful conversation as one can reasonably expect from a chat between two best selling authors and wonderful story tellers. I just checked with Ted from Live Talks LA and was informed that this video will be posted hopefully tomorrow (April 15th) on Live Talks LA’s official YouTube channel first and later on video pages here and/or here. (April 18th, 2014 update: The video is now posted and it is great! Have a watch!)

7) Bloomberg – Book TV: Michael Lewis Takes Viewers’ Questions on His New Book “Flash Boys: A Wall Street Revolt.” Added on April 22nd.

8) Michael Lewis: the stock market is rigged – video interview (UK Guardian) Added on April 30th, 2014.

Note: As Lewis and Katsuyama said many times, “High-Frequency Trading (HFT)” is too wide a term and hard to define so it is better to use terms like “high speed computerized scalping” where unfairness is built into the structure of the market (which is bad, very bad) vs “high speed computerized trading” which has reduced trading costs and enhanced investors’ trading experience over the years!

Additional video and audio clips:

* CBC News in-depth interview with Katsuyama (April 4th, 2014). Worth a watch.

* April 9th, 2014 CBC radio audio clip of Lewis (2:10 – 28:09) and a ~50 seconds short clip explaining “how High-Frequency Trading makes stock markets more like rigged casinos“.

* Here is a brief video clip of Berkshire Hathaway’s Charlie Munger saying (in May 2013), “I think it is very stupid to allow a system to evolve where half of the trading is a bunch of short term people trying to get information one millionth of a nanosecond ahead of somebody else“.

Additional references that worth a read:

* “Digging Into The Cliffhanger That Ends the New Michael Lewis Book“, April 7th, 2014. Recommended interesting tidbit of information for readers of the book.

* “Lewis Calls Flash Boys Blowback ‘Thoughtless’” April 2, 2014 Bloomberg Businessweek

* March 10th, 2014 SEC S-1 filing of Virtu Financial where it talks/brags about “As a result of our successful real-time risk management strategy, we have had only one losing trading day since January 1, 2008.” [HT CNBC Bob Pisani’s “Michael Lewis’ ‘Flash Boys and high-speed trading“]

* “High-Frequency Traders Set for Curbs as EU Reins In Flash Boys“, April 13th, 2014 Bloomberg News

* “The need for speed is costing billions New York’s attorney general explains his investigation into high-frequency trading“, April 3rd, 2014, by ERIC T. SCHNEIDERMAN (New York’s attorney general)

C-Span – Q&A: Michael Lewis “The Big Short” – Added on April 22 (video uploaded on April 5, 2010)

NOTE: This article is cross-posted on examiner.com by me.

July 22nd, 2014 Update: An hour long video chat between Michael Lewis and Conan O’Brien

“Conan talks with Michael Lewis, the author of Flash Boys & Moneyball on Wall Street’s desperate need for oversight, why the financial market should look for a responsible, overpaid “son of bitch,” & how he gets pumped up by listening to the “Frozen” soundtrack.”

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