Gone are the days of prices scratched out on chalkboards. Ticker-tape machines are relics. Morning newspaper stock quote pages have shrunk even though the number of publicly traded stocks has exploded. Scenes of wild hand gesticulations and shouting oneself hoarse have been relegated to TV backdrops.
The stock market is an electronic marvel of technology and innovation. Money moving in microseconds fueled by algorithms has replaced deliberate decisions by long-term investors. Wall Street is an address. The real stock trading takes place in data centers in New Jersey and from digital microwave dishes in Illinois. This is today's high-speed, high-frequency stock market.
The Senate Permanent Subcommittee on Investigations slowly turns its attention to high-speed trading on Tuesday. The hearing's proposition is that the increasing speed of trading has led to investors losing confidence. Critics of accelerating market speed worry the technology are fallible and destructive. It is. The flash crash in May 2010 wiped out $800 billion of U.S. stock wealth in a few minutes.
The stock market has never been without operational risk and improvement. Higher trading volume in the early 1970s led to trading halts and even market closures as brokers and exchanges got caught up on paperwork. Computer trading ushered in the modern pricing of stocks in dollars and cents instead of dollars and fractions. That revolution helped bring about today's nanosecond trading strategies.
Investor confidence is not speed-dependent. It's built upon trust, reliability and fairness at any speed.
Tom Hudson, financial journalist, hosts "The Sunshine Economy" on WLRN-FM in Miami, where he is the vice president of news. He is the former co-anchor and managing editor of "Nightly Business Report" on public television. Follow him on Twitter@HudsonsView.