Michael Lewis, the well known author of “The Big Short” and “Liars’ Poker,” talked with HuffPost Live Wednesday about the dangers of high-frequency trading as seen in his new book “Flash Boys.”
High-frequency trading, which uses computer algorithms to make stock trades in milliseconds, has botched IPOs and even caused the market to suddenly tank, or "flash crash," in the past. But if the practice continues unchecked, the consequences might very well be unimaginable, Lewis said.
“I don’t know,” Lewis responded to HuffPost Live’s Josh Zepps when asked what could potentially happen should high-frequency trade systems fail. “I’m not sure anybody knows.
"I’ve asked that question of people who should know and nobody has an answer for me," he added.
Lewis’ answer -- which Zepps said isn’t “very reassuring” -- fits into the author’s recent claim while on 60 Minutes that high-frequency trading is rigging the stock market, since it allows traders to gain an advantage using the lightning fast trades.
“There’s a sense that something’s goofy with this market,” Lewis added.