Exactly a year after the stock market “flash crash,” in which the Dow Jones Industrial Average dropped 600 points in about five minutes, the Securities and Exchange Commission Chairman Mary Schapiro vowed to continue to strengthen the defenses of the markets against a repeat incident.
More important than the harm that such price volatlity caused investors, May 6 deeply shook investors’ confidence in the market, said Schapiro this morning at the Investment Company Institute’s general meeting. “We need to continue examining the effects of high speed trading on the markets and on buy-side and fundamental investors,” she said, according to a statement. “The stakes are sufficiently high – for markets, for firms seeking to raise capital at a reasonable cost, and of course for the investors investing through the funds you manage – high enough that further examination is not only desirable but required of conscientious regulators.”
