Flash Boys: A Wall Street Revolt (33 page)

The tower was 180 feet high, with no ladder, and festooned with electrical equipment. “Why did you do that?” I asked.

“I was pregnant and it was a lot of work,” she replied, as if that answered the question.

“And that’s why your baby had seven toes!” hooted one of the other women, and they all laughed.

If one of the women had hopped over the fence around the tower and climbed to the top, she would have had an unobstructed view of the next tower and, from there, the tower beyond. This was just one in a chain of thirty-eight towers that carried news of the direction of the stock market from Chicago to New Jersey: up or down; buy or sell; in or out. We walked around the site. The tower showed some signs of age. It could have been erected some time ago, for some other purpose. But the ancillary equipment—the generator, a concrete bunker to hold God knows what—was all shiny and new. The repeaters that amplify financial signals resembled kettle drums, bolted onto the side of the tower: These were also new. The speed with which they transmitted signals, and with which the computers on either end of the chain of towers turned the signals into financial actions, were still as difficult to comprehend as the forces of nature once had been. Anything said about them could be believed.
People no longer are responsible for what happens in the market, because computers make all the decisions.
And in the beginning God created the heaven and the earth.

I noticed, before we left, a metal plate attached to the fence around the tower. On it was a Federal Communications Commission license number: 1215095. The number, along with an Internet connection, was enough to lead an inquisitive person to the story behind the tower. The application to use the tower to send a microwave signal had been filed in July 2012, and it had been filed by . . . well, it isn’t possible to keep any of this secret anymore. A day’s journey in cyberspace would lead anyone who wished to know it into another incredible but true Wall Street story, of hypocrisy and secrecy and the endless quest by human beings to gain a certain edge in an uncertain world. All that one needed to discover the truth about the tower was the desire to know it.

ACKNOWLEDGMENTS

T
he U.S. financial system has experienced many changes since I first entered it, and one of them is in its relationship to any writer who attempts to figure out what’s going on inside of it. Wall Street firms—not just the big banks but all of them—have grown greatly more concerned than they were in the late 1980s with what some journalist might say about them. To judge only from their behavior, they have a lot more to fear. They are more likely than they once were to seek to shape any story told about them. At the same time, the people who work in these firms have grown more cynical about them, and more willing to reveal their inner workings, so long as their name is not attached to these revelations. As a result, I am unable to thank many of the people inside banks and high-frequency trading firms and stock exchanges who spoke openly about them, and helped me to comprehend the seemingly incomprehensible.

Some other people not mentioned in this book were important to its creation. Jacob Weisberg read an early draft and had shrewd things to say about it. At different times and in different ways, Dacher Keltner, Tabitha Soren, and Doug Stumpf listened to me drone on at length about what I was working on, and responded with thoughts that never would have occurred to me. Jaime Lalinde helped me, invaluably, in researching the case of Serge Aleynikov. I apologize to Ryan Harrington, at W. W. Norton, for sending him chasing around for illustrations that I thought might be useful but which turned out to be a dumb idea. He did it very well, though.

Starling Lawrence has edited my books since I first started writing them, with his peculiar combination of encouragement and detachment. He edited this one, too, and I’ve never benefited so much from his unwillingness to allow me to enjoy even the briefest moment of self-satisfaction. The third member of our team, Janet Byrne, is the finest copy editor I have ever worked with. Many mornings her enthusiasm got me out of my bed, and many evenings her diligence prevented me from getting back into it.

Finally, I’d like not only to thank the employees of IEX but also to list them by name, so one day people can look back and know them. They are: Lana Amer, Benjamin Aisen, Daniel Aisen, Joshua Blackburn, Donald Bollerman, James Cape, Francis Chung, Adrian Facini, Stan Feldman, Brian Foley, Ramon Gonzalez, Bradley Katsuyama, Craig Katsuyama, Joe Kondel, Gerald Lam, Frank Lennox, Tara McKee, Rick Molakala, Tom O’Brien, Robert Park, Stefan Parker, Zoran Perkov, Eric Quinlan, Ronan Ryan, Rob Salman, Prerak Sanghvi, Eric Schmid, John Schwall, Constantine Sokoloff, Beau Tateyama, Matt Trudeau, Larry Yu, Allen Zhang, and Billy Zhao.

ALSO BY MICHAEL LEWIS

Boomerang

The Big Short

Home Game

The Blind Side

Coach

Moneyball

Next

The New New Thing

Losers

Pacific Rift

The Money Culture

Liar’s Poker

EDITED BY MICHAEL LEWIS

Panic

Copyright © 2014 by Michael Lewis

All rights reserved
First Edition

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The Library of Congress has cataloged the printed edition as follows:

Lewis, Michael (Michael M.)

Flash boys : a Wall Street revolt / Michael Lewis. — First Edition.

pages cm

Includes bibliographical references and index.

ISBN 978-0-393-24466-3 (hardcover : alk. paper)

1. Stockbrokers—United States. 2. Wall Street (New York, N.Y.)
3. Finance—United States—History—21st century. I. Title.

HG4628.5L49 2014

332.6'2092273—dc23

                                                            2014003208

ISBN 978-0-393-24467-0 (e-book)

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