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Senator Reed sees need for speed to chase bad guys
Ann Saphir takes a look at Senator Jack Reed’s comments on cars and trading.
With traders buying and selling at dizzying speeds these days, underfunded U.S. regulators can’t hope to keep up unless they get more funding, better resources, and faster technology — think cars, Democratic Senator Jack Reed says.
Reed, who drives a 1991 Ford Escort, says he loves his car for city driving.
But if he had to take on a race car, he’d need to upgrade – and the same goes for the Securities and Exchange Commission and the Commodity Futures Trading Commission, which are stuck using outdated technology even as their policing obligations pile up after Dodd-Frank financial reform.
House Republicans have moved to block funding increases for the regulators, saying they don’t want to add to the federal deficit.
“If I’ve got a 1991 SEC, CFTC trying to catch high frequency traders, it’s never going to happen,” Reed told the Reuters Futures Face of Finance Summit. “We’ve got to get them, maybe not up to Ferrari level, but at least up to a Fusion.”
But is that fast enough?
A Ford Fusion can get from a standstill to 100 miles per hour in just over 21 seconds, according to a review of the 2010 model by Car and Driver magazine. A Ferrari 599 GTB Fiorano, the Italian carmaker’s flagship two-seater, can get there in just less than 9 seconds.
And high frequency traders? With millions of trades possible in less than a second, even a Ferrari might not be fast enough.
Photo credit: Reuters/Kevin Lamarque (Senator Reed at Reuters summit)