The Morgan Building is on the third basement floor.

The 2,000-square-meter basement has been renovated, with four walls waterproof and moisture-proof, and hundreds of incandescent lamps embedded in the roof, illuminating the entire space very brightly.

In the center of the empty basement are five one-person-high black cabinets, where several arm-thick cables can be seen intersecting, and countless indicators on the cabinets are flickering brightly and dimly, full of technology.

Around the basement, except for the entrance wall, a thick bulletproof glass wall is used to divide the entire basement space into a zigzag. In addition to visiting the inner space of the equipment, the outer circle of space is full of desks and chairs, and many employees are intently tapping on the keyboard at their desks.

"There are a total of five IBM-system390 fifth-generation servers, which are specially customized by us, running at a speed of more than 900 million times per second, which is the fastest mainframe at present, and can process more than 200,000 transaction instructions per minute. Charlie Josie, Coyce's IT director, led Zhang Chen, who was wearing dust suits, and Bellankefen and other senior executives of Coyce to visit the newly built data processing center.

"How's Alpha Go's software optimization?" asked Zhang Chen.

Richard Josie shrugged, "That's exactly what I was trying to say, they've just updated the system version and it seems to have made changes to the entire architecture. Originally, we thought they were crazy, but we didn't expect the effect to be good, to be precise, very pleasantly surprised, and the response speed fully met our requirements. ”

Zhang Chen was interested: "Oh, really, can it be applied now?"

Richard Josie shook his head: "It still needs to be debugged for a period of time, at most a week, after a week, you should be able to carry out trial calculations and data collation, the more complete the data, the higher the success rate of automatic trading, and then there will be a simulated trading test, it will take about three months, I am confident that this system can be put into actual combat before January 1." ”

Zhang Chen showed a hint of a smile, this was the best news he had heard recently. On January 1 next year, AST will be officially launched, and Cowyce will move the trading server to the computer rooms of the New York Stock Exchange and the NASDAQ, and truly become a parallel service provider for the two major stock markets.

After becoming a parallel service provider of the exchange, Cowyce only needs to pay the share of the exchange on a monthly basis, and he can see the information of the market transaction 0.3 seconds in advance. Taking advantage of the time difference of 0.3 seconds, it is completely possible to buy long before the market is bought long and short before the market is sold short through a high-speed computer, making money without risk.

Cowyce wants to make a lightning trade, and this is the only opportunity.

Different from high-frequency trading, lightning trading is that only giant crocodiles can eat the fat in their mouths, and the proportion of spoils is determined according to the status of the rivers and lakes.

This kind of opportunity was only available at the beginning of the AST landing, and when financial giants like JPMorgan Goldman Sachs realized this money-free trading model, no one could stop them from entering the market.

Moreover, when Morgan and Goldman Sachs enter this market, even if they have strong business ethics and do not use off-market tricks to deal with Cowys, it will become a showdown of computing power and capital, and Cowys's capital will not be able to compete with these old investment banks.

Therefore, Zhang Chen is now deploying high-frequency trading. If lightning trading is cheating and playing the edge ball of the law, high-frequency trading is a completely innocent business.

High-frequency trading and lightning trading have a lot in common, both pursue the shortest physical distance from the exchange, and also rely on computers and high-speed networks and automated trading software to achieve a large number of fast transactions, and they can also earn high profits.

Similarly, lightning trading, like high-frequency trading, also has competition between parallel service providers, more than one parallel service provider, can see the transaction 0.3 seconds in advance, there is also an arms race between hardware and algorithms.

If there is a difference, the biggest difference between the two is this 0.3 seconds.

High-frequency trading service providers do not have the advantage of 0.3 seconds of trading, and completely rely on algorithms to predict market trends, use high-speed networks to place orders before ordinary investors, and can also cancel orders immediately, disrupting the market and making profits.

But it is these 0.3 seconds that make the two essentially different, and the cost is also very different. Imagine that, with the help of ultra-high-speed computers, lightning trading can eat up the difference between all the mismatches in the market, which is a terrifying number, and before the ban on lightning trading, parallel traders on Wall Street were able to eat up tens of billions of profits from lightning trading every year without risk. And their cost is just tens of millions to hundreds of millions of dollars per year in hardware replacement costs and labor costs.

Oh, and there's a lot of money, and when lightning trading was all the rage, the juxtaposition service providers had to give $500,000 a day to the exchange, and $100 million a year.

Moreover, it is precisely this 0.3 seconds that legally constitutes unfair competition for flash transactions, and also contributed to the 09 US legislation prohibiting lightning transactions.

0.3 seconds is the difference between "zero" and "everything".

The most incredible thing is that here, such obvious unfair competition, since 99 years Da Mo and Goldman Sachs and Merrill Lynch have become parallel traders on major exchanges, and began to make waves in this market, but it took ten years for the United States to legislate and prohibit it, which is self-evident.

After that, lightning trading gradually changed to high-frequency trading, but after these old investment banks lost their administrative support, they could not compete with the emerging high-frequency traders, and gradually withdrew from the stage of high-frequency trading, until more than ten years later, there were only four emerging companies specializing in high-frequency trading left in the high-frequency trading market. These four emerging companies monopolize more than 80 percent of the trading volume of the U.S. stock market.

What does it mean, that is, the stock you sell is not bought by retail investors like you, but by high-frequency traders who are sitting in the market. Similarly, the stocks you buy are not really bought from other retail investors or market makers, but from high-frequency traders.

The reason why the old investment banks withdrew from this market is related to their declining competitiveness on the one hand, and on the other hand, it is also a semi-voluntary withdrawal. After entering the era of high-frequency trading, it will be more and more difficult to make money, and high-frequency traders will make less and less money, from a real market profit of more than 10 billion US dollars to 5 billion, and finally it is difficult to maintain a profit of even one billion US dollars.

If high-frequency traders want to maintain a competitive advantage, they must constantly replace better hardware, research better algorithms, and better people in the network, and these are all costs. In the case of more and more competitors, prices are also being raised higher and higher, and the arms race is intensifying.

In addition, the risk is also increasing, and the slightest mistake on the part of the programmer can cause huge losses. The well-known Knight Capital in the field of high-frequency trading lost nearly $500 million in just 20 minutes because the system administrator forgot to upgrade one of the servers, resulting in a special situation that triggered a dead module action, and automatically filled millions of orders with a huge price deviation within a few minutes, and at the same time caused a sharp shock in the U.S. stock market.

It's not that easy to make money, of course, that's for followers.

For Zhang Chen, a pioneer who led the lightning transaction after being reborn, there was a mountain of gold in front of him!

And it is a gold mountain that can be monopolized by itself for at least three months!

Zhang Chen has calculated that if a parallel service provider with computing power not less than his own appears, his profit rate will be reduced by 60%, because part of the computing power will be wasted on defense, and he will inevitably give up part of the harvesting behavior. If two of them show up, the profitability will be further reduced to 18 percent.

Zhang Chen asked the people in the data center to calculate that based on the current trading volume of the two cities in the United States, if he could monopolize 50% of the trading volume, he would be able to make a net income of more than $40 million per day. The amount of capital invested only needs 35 million US dollars and 20 or 30 times the leverage.

The reason why lightning traders can make money is because of leverage, almost zero risk allows them to increase leverage at will, tens of millions of dollars can leverage more than a billion dollars, plus the speed of lightning transactions, 100 million dollars a day can create at least nearly 10 billion trading volume, the current New York Stock Exchange and NASDAQ combined daily trading volume is only 90 billion US dollars, 100% monopoly trading volume will definitely not be possible, but monopolizing more than 50% of intermediate transactions, it is still very easy.

Fortunately, the legal system in the United States is relatively sound, even if the major exchanges and giants know that Cowyce, a small company, makes a lot of money by exploiting loopholes, they can only be restrained within the rules, and the giants can only rush back to the meeting with a white face, and also open a lightning trading business, run into the market, and compete for business with Cowys.

"As I said in my last email, there are no problems with the NYSE and the NASDAQ, and now only the Securities and Futures Commission is left, and there are still some problems with trying to keep them from looking for trouble. Blancfin said softly.

Zhang Chen frowned: "Difficult?"

Bellankefen smiled and shook his head: "It's not a matter of difficulty. He looked around and whispered, "Robin Turner, the Chief Risk Management Officer of MRD (Securities Market Management Department), hopes that he can get a consultant position with an annual salary of 250,000 yuan for Cowyce after retirement. ”

Zhang Chen tilted his head and said strangely: "He wants to come to work in Kouys?"

"He'll probably come back to Harvard in two years as a professor of economics, and you know, a lot of professors at Harvard will have some other part-time consultants out there." After saying that, Bellakfin added, "Wendy Gramm, the wife of the chairman of the banking committee, Fergram, has been a director of Anlong since ninety-three, and this kind of thing is very common. ”

Zhang Chen was surprised, and couldn't help but chuckle, it was really as black as a crow in the world, but the black one here was quite hidden.

"Yes, you can make up your mind about that. Zhang Chen said casually.

Bellankefen didn't take this seriously, and smiled: "Recently, the communication between Salomon Smith Barney and Citi has become closer and closer, and it is estimated that it has entered the substantive negotiation stage." ”

Zhang Chen nodded: "I just joined the board of directors of Salomon Smith Barney yesterday, seven people agreed, one abstained, the board approved that the management can contact Citi, and it is estimated that there will be results soon." ”

Frankfinn is intrigued, Salomon Smith Barney is already the second-largest investment bank in the United States, and of course, the second-largest in the world, and if it can really merge with Citigroup, it will become the world's largest integrated financial services group.

"Can Citi really bypass the Glasssteagall Act?" asked Blankfin curiously.

Since its implementation in 1934, the Glasssteagall Act has been an ironclad law in the American financial community. In order to avoid industry risks and cause comprehensive fluctuations, commercial banks are prohibited from engaging in investment banking business. For decades, countless commercial banks have wanted to break through this restriction and get involved in the more profitable investment banking business, and countless investment banks have been looking at trillions of ordinary deposits and drooling, but they have no choice. Did Sandywell really find a way around this bill?

Zhang Chen snorted: "What's the way." ”

Bellankefen was surprised: "Do they want to forcibly merge?"

No wonder Belrankefen was surprised, although this bill has been loosened now, it has not been repealed after all, and it is still very risky to merge rashly. In the event that Congress or some of the members of the parliament who are not long-sighted are tossed up, and some contingencies are encountered, the consequences may be catastrophic.

Zhang Chen said: "Have you read Alan Greenspan's speech at the Federal Reserve's regular meeting a few days ago? Although he did not make a clear statement, he said: 'Under the current economic situation, certain financial control bills are outdated, which inhibits economic development. In addition, Robert Edward Rubin also said in his speech to Congress a few days ago, "The priority of this administration is to repeal some unreasonable financial regulations." 'Combine the two, and you still can't hear the taste?'

Blancfin frowned: "You mean that Citi and Salomon Smith Barney have received support from Congress and the Federal Reserve?"

Zhang Chen said leisurely: "Since 1982, when the Reagan administration opened up financial regulations, and savings banks could use depositors' deposits for investment business to a limited extent, the Glasssteagall Act has existed in name only, and even the Char Skidin loan scandal in the late eighties did not stop this. Since then, it is destined to come one day. ”

"Now that the U.S. economy is in the best era in two hundred years, neither commercial banks nor investment banks will be willing to eat this part of the cake in front of them in this big era, they want more. With the combination of the two, Washington will certainly acquiesce to the existence of this deal, and thus have a reason to amend the Glasssteagall Act. ”

"Look, it's not surprising, it's been two months. ”

Blancfin narrowed his eyes: "Do you think you can keep a seat on the board of directors of the new company after the merger?"

Zhang Chen shook his head and said with a smile: "After the merger, the seats on the board of directors of the two sides will definitely be reduced, and there should be no more than thirteen seats in total, not to mention that some new members may be added, even if only Citigroup and Salomon Smith Barney are counted, it will be difficult to retain the seats of Tinder." ”

Frank Smacked his lips regretfully, looked at Zhang Chen, and said curiously, "But you don't seem to be depressed at all?"

Zhang Chen smiled: "It's not a good thing that Sai Weng lost his horse and knew that it was not a blessing. ”

The second-generation goblin is quite good-looking, why is the rating so low? I was a bit of a fan of Liu Yifei and Feng Shaofeng.

It's strange how this film passed the trial.,Although it's entertainment.,But some of the villain's lines and ideology.。。。 Hehe...

(End of chapter)