Thanks for inviting me to guest blog. As Stefan said, my area is corporate governance with particular interests in the rights and responsibilities of corporations in society, and how changing market dynamics impact corporations. In that vein, I had the pleasure of moderating a panel discussion yesterday at New York Law School on High Frequency Traders (HFTs). The panel immediately followed an announcement by New York Attorney General Eric Schneiderman on new proposals targeted at HFT firms (part of what his office terms their “Insider Trading 2.0” initiative).We certainly had a lively discourse and a link to the full panel discussion will be available shortly— I’ll be sure to post at that time. But in short, here are the highlights:

High frequency traders use a fully automated trading system to move in and out of securities at a rapid speed, often just in milliseconds. To get a sense of what is at stake, consider that by constructing a high-speed fiber optic cable, round-trip communication time between New York and Chicago was reduced from 16ms to 13ms, and now using microwave technology, the round-trip transmission time was further reduced to 10ms, then to 9ms, and most recently to 8.5ms. What can…