SEC Says “Flash Crash” Not Preventable

Last May, a “flash crash” sent the Dow plummeting 700 points before it bounced back up a few minutes later. Reuters reports that, on the one-year anniversary of the flash crash, Securities and Exchange Commission Chairman Mary Schapiro said that the SEC has implemented some reforms, but that there’s no guarantee that another flash crash will be prevented. To date, the agency has implemented so-called circuit breakers, rules for mitigating mistaken trades, a prohibition on stub quotes, and a ban on certain types of market access. Schapiro indicated that, in the coming months, the agency would issue rules on large trader reporting and a consolidated audit trail. The SEC is also considering whether or not to charge high-speed traders fees, regulate high-frequency traders, and whether to regulate or prohibit anonymous trading.