An almost shocking ignorance of financial history geometry

Surprisingly, nobody rose to the bait in my post of this morning and we ended up discussing spending on old age care rather than funding, so I'll try again. This evening's lesson is taken from today's FT:

High Frequency Trading] has made it harder for the traditional floor trader and affected the ability of the point-and-click crowd to make money.

I am one of its victims. When I began as a trader in the pork belly pit, I was as high a high frequency trader as possible. My computer was in my head and it responded as fast as it could. There were others in the pit who were slower. But there were also traders who were much faster. It never occurred to me to pass a law to cut them down to my speed... I readily understood a trader’s request to gain a trading booth closer to the pit.

James Angel, associate professor of finance at Georgetown University, recently said it made him shudder when he heard regulators asking: "Is it fair that people spend extra money to sit their computer right next to the stock exchange computer?" He said it showed an almost shocking ignorance of financial history.

It's the same old pattern; open outcry traders wanted to be nearest the pit; these HFT people will pay a lot extra to site their computers tens rather than hundreds of yards away from the exchange's central computer because the cabling costs money and in their line of work every millisecond they can be faster than the competition (signals do not travel instantaneously down computer cables!) means money.

It's the same as the hot dog vendor wanting the pitch nearest the tube station or people being prepared to pay more for a seat in the front rows of the theatre.

It's the same as every extra minute's walk from the tube station reducing house prices by £x,000 or every extra minute's commute time to/from central London reducing house prices by £y,000.

It's basic geometry.