Regulating fast trading on Wall St

David Silver has a nice article in the NYT comparing the proposed regulation of "flash trading" with some of the century old regulation of floor trades (and of "front running" before customer orders generally): A Short History of Fast Times on Wall Street . ("Flash trading":= Some exchanges have, for a fee, given some traders "pre-routing display" of bids and asks milli-seconds before they are shown to most traders. See Direct Edge.)

"Supercomputers allow certain traders to profit by executing trades in milliseconds, a practice known as high-frequency trading. These traders also use a technique called flash orders that gives them a sneak peek at other investors’ orders to buy and sell stock. ...

"...similar criticisms have been made for over 100 years, since the days when trades on the New York Stock Exchange were executed by humans using notepads and pencils.
Even back then, critics claimed that the exchange members who were physically present on the floor could get trading information and execute their own orders faster than anyone else. The creation of the Securities and Exchange Commission in 1934 included the power to regulate the buying and selling of securities by exchange members trading for themselves, rather than for customers.
A Roosevelt administration official testifying in support of the 1934 legislation, Thomas Corcoran, described such floor traders as “chiselers.” This referred to their ability to quickly buy from sellers at prices lower than they would otherwise get, and promptly resell to buyers at prices higher than they would otherwise pay.
These complaints were well founded. By being on the exchange floor, traders could see with their own eyes the prices of completed trades minutes before they appeared on the exchange tape. Executing their own orders gave them a head start over ordinary investors, whose orders could take minutes to reach the floor. As a former Wall Street Journal editor wrote in 1903, “They know the prices even before they are recorded on the tape, and they are able to join in every upward movement the moment it begins, and to abandon it the moment it shows signs of wavering.”
In 1909, a committee created by Gov. Charles Evans Hughes of New York to study stock market abuses similarly commented that floor traders “acquire early information concerning the changes which affect the values of securities,” giving them “special advantages” over other traders. "