We continue to see signs of a broken US market structure. Before something is fixed, it needs to break down completely.  We are currently seeing this in the US equity capital markets.  I have mentioned previously the only way to fix the national exchanges are with a central limit order book (CLOB) with lit only orders having priority.  The time is now and the awakening is starting.

Most recently, hand slaps by the SEC with two very large dark pools Barclays and Credit Suisse violations with fines hitting $150 million.  Primarily these violations were from Reg NMS of various sub-penny pricing and flash orders to preferential clients.  Basically cannibalizing their own network and clients.  This preferential treat to high frequency traders has been going on since the arrival of exchanges going public.  Once going public, exchanges only priority was earnings.  Liquidity was an after thought when earnings from flash traders was much more regardless if it was predatory order flow or not.

We also saw an announcement of a Chinese led investor group buying out the 134 year old Chicago Stock Exchange.  The Chicago Stock Exchange buyout is another sign that the US equity markets are about to see some much needed innovation.

With the passing of the Jobs Act, we will see secondary markets on smaller private companies.  This will lead to specialized niche players catering to the liquidity needs of private companies which ends up making an ecosystem to compete with public market places.