Incompetance abounds at the InterNIC

Fri Jan 22 03:07:21 UTC 1999

> At 01:55 PM 1/20/1999 -0700, Pete Kruckenberg wrote:
> >There is a key difference, and that is that stock speculators pay for the
> >right to speculate, so the system can afford to scale to meet the
> >increased volume. 
> 
> Actually, quite a few stock speculators don't pay for the privilege.  Many
> speculators are stock brokers or floor traders who speculate cost free
> (other than the cost of the stocks they buy).  And you should note that now
> that the stock exchanges are now nearly fully automated (though much less
> so than Internic), discount brokerages now charge less than Internic.
> Trading never stops now.   Again, I think a first class, high availability,
> high security database service can be operated without significant per
> transaction costs. 

This is a very bad example -

(1) On the floor there are costs associated with clearing of the trade
(ticket). The cost of the ticket depends on the number of shares that
changed hands. For example, if the transactions are cleared by a ML
Professional Clearing services, the cost I believe is about $0.01 per share. 
The second portion of the cost depends on what system someone used to
execute a trade - for example, SuperDOT matching costs $n. Attain is $0.005
per share. Bloomberg is $0.005 per share with $1.50 minimum. SelectNet is
additional $1

(2) Stock exchanges are *NOT* automated more than InterNIC. Some NASDAQ
books are automated more than others. As NASDAQ unlike NYSE can be traded
everywhere, in and out of the books, MMs it is not automated. The closes way
of how the NIC would have looked had it been working like NASDAQ, would have
looked like this:

	Two guys sit on the bar at 2am EST and one offers the other to
	register Microsoft.com ( yes, existing domain ) for $40 (number has
	no relevance to any price for buying the domain ). They cross the
	deal, and report the transaction to the NIC by 8am. NIC adjusts the
	database to reflect the transaction. Now you have two different,
	perfectly valid, domains with identical name. Would you like to 
	have a system such as this?

NYSE is not automated even with a SuperDOT as specialist decides how the
orders are matched.

These costs are paid by the crowd all the time. 

> Indeed, it is a damning indictment of Internic that stock brokerages charge
> less, yet provide more secure, and more highly available computer services.

This is also completely incorrect. Those who charge flat comissions, or
charge nothing, get paid a lot of money for the order flow where they would
always send your order to a specific MM even if that is not the best
bid/ask.

This is just to say please do not wish on us any portion of the internet to
work the way any of the exchanges currently work.

Alex