Madeline
Flash Boys by Michael Lewis is about the marriage of two things I am very fascinated by but also two things many people find boring: the stock market and technology. It covers the world of high-frequency trading and how technology influenced the market to make some people extremely rich and others loose their financial edge. Although technology appears to the laymen as speedy, when it comes to high-frequency trading, every millisecond counts.
Premise of Flash Boys
The book starts with how high-frequency trading use to be, before technology. How slow it was and how the introduction of fiber-optic cable changed everything. One man took it upon himself to find a route that was straightest route he could find to lay the fiber-optic cable. This simple action is what gave him the edge he needed to be paster than others who were milliseconds slower in transmitting data.
The Flash Boys continues through a series of stories on how technology has changed the world of high-frequency stock trading. The last story covers the difference between standards of the financial world and standards of the technology world. It is not common in the financial world for information to be shared, but in the technology world, a lot is shared through open source software. These worlds were crossed when a Goldman Sachs programer shared the barely changed open source code with himself and was deeply punished for it until it was determined that he did nothing wrong.
Computer Networking Class
As a complete coincidence, I happen to be taking a computer networking class while reading this book. Although the class covers topics that are much more detailed than Flash Boys, it helped to give context to what I was learning and what I was reading. In the class, we are taught how to calculate timing. It is difficult to understand why this is so important but this book helped to shed light on a subject that was greatly influenced by this. If you find yourself also taking a Computer Networking Class, I recommend this book to provide some context.
Final Thoughts
This is not the first book I have read of Michael Lewis, this is not even the second book I have read by him, but he keeps amazing me. His books are extremely dense and take some real paying attention to understand. There is no light reading here. That being said, I will continue to alternate my chick lit with his well thought out and researched books.
