Saturday, 30 January 2016

Jon Flanagan - LFC 2016

“It was always going to be mentally tough. I got told I wasn’t going to be out for as long as I was and to keep going for the length of time I have been out it is hard to get your head around." 
“You always have your moments, but you just have to stay positive. I think I am a strong character. You cannot go around with your head down feeling sorry for yourself, you have to pick yourself up and stay positive really. I always knew that I would overcome it.”
Scouse inspiration on the value of hard work from LFC's 23 year old Jon Flanagan January 2016 after 619 days of injury and recovery[source].

Friday, 15 January 2016

One for the road: Failure-to-deliver, Goldmans & Reg SHO

I've long worried about the craziness of the US market with respect to fails-to-deliver, so I couldn't resist a new piece of SEC news where Goldman Sachs has been fined $15M.

As a trader when you trade via a broker you normally have an ETB and Restricted list to comply with.  For whatever reason, you can't trade stock on the Restricted list. An ETB is the broker's Easy-To-Borrow list of stocks that are OK to short as there is plenty of liquidity for loans if you're short at close of business. Often the ETB has quantities that represent the start of the day position but you can never really be sure at the close. It's not usually much of a concern to an HFT as your absolute position sizes shouldn't be too high as you churn the pennies out. You just stick to the stocks on the ETB list.

When stock or money is not delivered on the T+3 settlement there is a "Failure-To-Deliver".

So, Goldman Sachs have just been fined $15M by the SEC for violations related to this. Here is the SEC document. It makes for a fun read as it is easy to understand how the automated mundane of unquestioning workflows, and pressing the "F3" key, can arrive at such a point. The F3 key here turned into the FU2 key. It's the kind of boring detail that gets stuck in some business processing re-engineered workflow that gets ignored as people do interesting things until it rears its head and bites you in the ass to the tune of $15M. That's some bite.

I've long worried somewhat pointlessly about this.

The SEC publish fails-to-deliver twice a month. Let's look at the total share volume of fails for the last couple of full months:

October 2015 3,785,306,033
November 2015 3,722,780,135
update: Dec 2015 4,273,095,148

That's a lot of shares that don't settle on T+3.

Infact, it is more shares than a modest broker, who may be getting smaller, like ITG, may trade for an entire month. Here are the ITG numbers for November 2015:

ITG U.S. Trading Activity

# of

Total U.S.

Average U.S.
Daily Volume



Alert Daily

Trade Size

Avg. Trade
Size Ex-

November 2015


















Reg SHO is the weird piece of regulation that gives T+4, T+6, T+13 cascading forgiveness plus there is a DTC way of loaning and covering some of the madness. Unfortunately, some in the industry treat settlement as entirely optional. Sometimes it is because you'd prefer to cover that short in a day's time at a better price. Sometimes it is just because someone forgot something. Then there is just the poor practice of workflow rot that seeps through the cracks into a place like Goldman Sachs when everyone is trying to do things not so boring.

There are legitimate reasons why a failure-to-deliver should not be a huge deal but it should also not be settled for as a common settlement settling. Perhaps charging $10 per share or 10% would wipe out the practice smartly but that seems extreme. My prediction for 2016 is that this will largely be ignored and swept back under the carpet because it is so not so interesting except to ageing fintech geeks like me.

Happy trading,


Thursday, 14 January 2016

Happy new year and bye

It's 2016 and I've been sitting on the bench for a long time. Time to get back to work and feed the family. This somewhat unprofessional blog, and other media, will no doubt go as a consequence.

In the meanwhile, if there are any nice projects you may think would be mutually beneficial, reach out.

Happy trading,


CME to Shanghai - Uncle Kim?

Transit negotiations for the lowest latency path between CME and Shanghai would be interesting.

You'd better hire Dennis Rodman as a lobbyist.

Direct Path: Chicago to Shanghai via North Korea (Source)

Uncle Kim and Dennis hanging out: Source

Saturday, 2 January 2016

IEX - InvestorSexChange - the quest for validation & revenue

OK. Let's cut to the chase.

Q: Should IEX be allowed to become an official stock exchange?
Me: Yes

Q: Should IEX have protected quote status?
Me: No.

Huh? Those things are in conflict. How can it be so?

Firstly, I have nothing much new to say that hasn't been said already. If you're expecting some insight here, you should probably stop reading now and find a better way to start 2016. Here are some of the more educated opinions from people clearly smarter than me:
I'm not sure anyone cares for my thoughts on the matter. I've stayed quite quiet but a few people have asked politely for comment, so here are my meanderings.

Firstly, the IEX has been chugging along quite well. As you can see in the chart below, they are currently the third biggest ATS in tier one stocks by volume as at December 7, 2015 (coincidently my start to the 25th year of marriage, poor woman), according to the latest published statistics from Finra. They remain a small player in the overall market being reported to be around 1-2% of overall volume. Funnily enough IEX's biggest traders each day are usually HFTs as confessed by Citadel.
IEX - third largest ATS in tier one stocks (click to enlarge)
ATS data is provided via and is copyrighted by FINRA 2016


The positioning from those for and against IEX's exchange application has been pretty strong and vocal. Much of the debate, especially the Joanne Doe letters from many investors to the SEC as comment letters, has been rather silly and pointless, though often funny. Here is a link to the SEC letters.

The spoof comedy letter from a fictional town in Oregon with someone pretending to be a kid wanting IEX's application to be approved is perhaps the best example of facetious interest in the matter:
Subject: File No. 10-222
From: Danny Mulson
Affiliation: 8th Grade Student
December 15, 2015
Dear SEC,

I am a future stock investor, currently in the 8th grade at Aberdeen Middle School in Wetlawn Oregon. I whole heartily approve of the IEX plan to slow down trading.

Things move too fast in this world and we need to slow it down in every way we can. Take my school for instance. When we stand in line to pay for our lunch, we have two cashiers to pick from. There is Mr. Fields, who was recently fired from a data entry job. I heard he made some creepy comments to one of his female co-workers. But that isn't important. Mr. Fields can work that cash register like nobodies business. Even when twice as long, most kids will get in Mr. Fields line. Me, on the other hand. I prefer to get in Josephine's line. She used to work at the DMV before failing a drug test. I always get in her line. Sure, it takes me much longer, but she will always give me a compliment and ask me about my day.

In conclusion, IEX should be rewarded for slowing everything down and moving things backward. Cause backwards is awesome

Thank you for your time.
I'm pretty sure "Danny" is not referring to the SEC's Mr Fields and Josephine isn't a pun on Mary Jo White. Surely not. A follow up letter from the same fictional school in Wetland demonstrates why the SEC should have a little more rigour in the identification of bona fide credentials for letter acceptance.

Subject: File No. 10-222
From: Emma Hibernia
Affiliation: Aberdeen Middle School
December 23, 2015
Dear SEC:
I saw that letter Danny Mulson wrote to you. The Whole School Saw It. You need to know that Danny Mulson NEVER tells you everything he just tells you what HE wants you to know. 
OK Mr. Fields is fast. BUT Mr. Fields also takes 10 cents from everybody he checks out and when you complain about it he just laughs and says it's part of his job and everybody gets paid for their job so he should too. I thought he already got paid? But he said it wasn't enough. And suppose you want TWO milks well the first milk will cost you one price and then he charges MORE for the second one and you say they were all there to start with and the price tag was the same for ALL of them and he just says things change. WHAT CHANGED?? 
And Mr. Fields is creepy too just like Danny said but he didn't tell you everything at all. Mr. Fields got the cafeteria manager to make the GIRLS go down one ramp to the registers and the BOYS go down another ramp and the girls ramp is LOWER so instead of looking at us at eye level he gets to look down at us. Do you get what I mean?? So we complained to the cafeteria managers and they said it makes everything BETTER? And even though I begged her NOT TO my mother complained to the school board and they said they would put it on the agenda for like some meeting a gillion years from now after they talked about parking and everybody is already DEAD. 
Very truly yours,
Then you see part of the problem with a well meaning letter from a Professor of Physics, if a true letter that is,
Subject: File No. 10-222
From: John B Rundle
Affiliation: Professor of Physics, University of California

December 31, 2015

I strongly urge that IEX be granted the status of a national exchange. Please do not let the opposition of an entrenched few competitors roadblock their application. All investors want and need increased transparency in trading of securities.
Finance and market structure seems a field far removed from Professor Rundle's field of earthquakes. Michael Lewis wrote a largely fictional work in Flash Boys where the old mates of Lewis from one of his prior fawning books, "The New New Thing" (a fun read), invested in Spread Networks and IEX. The stupidity espoused as fact in that book, and 60 minutes subsequent "insights", has stirred the pot with many readers believing the crap about Reg NMS being broken because Michael Lewis told them so. Perhaps Professor Rundle and many other letter writers fall into this camp of mistaken fan girls and boys. If the Lewis story was correct their outrage would be well placed, but the Lewis story is an improperly researched fraud perhaps biased by his prior friendships from parties related to "The New New Thing." As an ageing HFT guy I certainly have my own prejudices.

Professor Rundle's letter is amusing as much of the benefit in market structure from IEX, yes there is benefit, comes from the DPEG order type. IEX's DPEG is complex, hidden or dark, and not necessarily an order a retail customer would easily understand nor lodge via their broker. In December 2014 IEX claimed its use was increasing and was then up to 11% of volume. This kind of order is beneficial to many users, not so great for some others, but parasitic, like most dark orders, with respect to market structure. I don't think Professor Rundle understands this opaqueness based on his short letter referring to transparency.

I wrote disparagingly about the IEX DPEG a while ago saying that IEX should not be allowed to become an exchange with such a proprietary order type that had such unknown workings. It was a good example of IEX espousing virtues of simplicity, transparency, and openness and not walking its own talk. I'm glad to say IEX largely fixed those issues of "magic" workings with a more detailed explanation of the DPEG in their exchange application, though they failed to properly disclose timing related issues. Ironically, this order type is exactly the kind of complex order Michael Lewis and Brad Katsuyama were both rallying against in Flash Boys. One woman's terrorist is another woman's freedom fighter.

IEX benefits

The DPEG is a pretty good order for HFT types. In a simplistic sense, it may allow you to sit on the bid or offer and be protected from some adverse selection with DPEG's last-look like facility. This is due to the fact that IEX uses current market data without any delay for crumbling quote protection versus stale magic shoe boxed data otherwise. DPEG is parasitic to market structure as it is only valid in a market environment that provides an appropriately efficient context.

Apart from that benefit, I can't really see any benefit from IEX apart from the fact that they have good ethical people running the exchange, like many other exchanges, with a particular customer segment, institutional investors and HFTs, they suit best. HFTs and IEX? Yep, remember Virtu was one of their larger early customers and in Citadel's comment letter they noted that on some trading days Citadel themselves were the biggest trader on IEX. 

Fundamentally I believe IEX has a very poor business model as it sails against the forces of efficient price discovery and risk transfer. Historically inefficiency in an enterprise makes for a shortened life span.  Once you also figure in their more expensive than normal transaction fees, long term survival seems unlikely. They have great marketing and mind share, as you can see from the letters submitted to the SEC, thanks largely to the effect of Mr Lewis and Flash Boys. At the end of the day, failure or adjustment of course seems the only likely outcome for IEX but that may be years away. They have good momentum.

The mistake that became IEX

In Flash Boys, Lewis describes Brad Katsuyama as a broker that developed a new insight into the market that led to the tool Thor at RBC. Thor could hit every bid or offer in the market by timing the order releases so the child orders would hit every exchange concurrently. So much for phantom liquidity. Turns out it was real. Basically Brad was being paid $2 million a year to execute badly for his clients as many others in the market already knew this somewhat obvious fact. So Brad mistakenly thought he was on to something and decided if he could slow down every order at a new exchange then he could prevent his customers being picked off. So, off he went and created IEX on this dumb premise. It was dumb premise as slowing down the orders just makes you an inefficient and slow exchange. You're still susceptible to faster traders picking off orders as it remains a race to the order queues as I pointed out previously and Citadel also noted in their SEC comment letter(s).

The eventual development of the DPEG order added a benefit due to the differential nature of the use of use of market data. Using current market data when others see delayed market data is the same as seeing into the future. So DPEG is useful to some, but it has to be understood to be parasitic and thus unworthy of market defining use in the large. That is, there is nothing wrong with parasitic if it is useful and doesn't destroy the host where the host is the NMS in this case.

A truly fair and efficient exchange

The best exchange for retail and institutional investors would look somewhat different to IEX but largely solve the same problems that Brad set out to solve. It would have the following features:
  • the lowest match and report latency (efficient)
  • length matched cabling in a co-location facility (fair)
  • no feed back on order lines, e.g. one way UDP in (no canaries)
  • common market data for all that includes coded order feedback
  • low latency microwave market data piped in, including CME (assist fairness for all)
  • simple order types, add, delete, modify for limit/ioc and that's about it (think Nasdaq UFO/Ouch)
  • carefully calibrated, low, and simple transaction pricing with no volume level breaks 
Plus a few other features. This would make for a seemingly simple exchange that would have the winds of efficiency in price discovery and risk transfer at its back providing a natural liquidity sink and business momentum. Ironically HFTs would not like such an environment as it would be very difficult to get any kind of competitive edge on their brethren. However, many HFTs also would like a simple exchange where there was no obvious disadvantage to blind side them. That is a constant HFT theme. HFT's like to find an edge on their competition, but prefer low latency simple environments without disadvantage where it is ironically hard to find any edge.

If you look at the above list and count the number of those features IEX has, you quickly get to zero. IEX could do better. There is still space for simple innovation in the exchange space at least.

OK, OK, get to the point, should IEX be an exchange?

Yes, I think IEX should be allowed to be an exchange based on my principle that it offers a bit of innovation with the last-look DPEG, it is acting honourably, and it is no worse than other platforms.

IEX's "look at our pretty colour" marketing does not appeal to my inner engineer that wishes for proper purpose. However, just because the IEX business model is a bit daft and its presence is suggestive of petty pretty pointlessness doesn't mean it shouldn't be allowed to be an exchange. IEX should be allowed to be stupid and fail. Stupidity is not a crime.

I certainly don't think IEX should be allowed to be an exchange with the non-delayed order routing by its broker dealer. We don't need an escalating war of delayed routing between exchanges screwing up the NMS. However, this could be dealt with by the SEC in a conditional approval. Similarly I think IEX's original application was flawed in terms of disclosure around workflows with respect to timings and delays but this was largely corrected, when forced by complaint, in further submissions. The poor form of the original application in this regard could result in the SEC denying and asking for a fuller reapplication, perhaps with a shortened process if that is allowed, but I don't think that is necessary given the widespread debate and current information. Minor corrective submissions or comment should be enough.

The purposeful delays in IEX's system should also make it that so they don't get protected quote status for their prices within the NMS. Quotes should be tradeable. A solution, such as Thor, should find real executable volume to the best of an exchange's ability and not a significantly and purposefully delayed rear view mirror of the past. If you want to read about protected quotes in Reg NMS Sec 242 Rule 611 and friends, please do. Simply put, exchanges' quotes are protected in that every broker must seek the best price amongst exchanges for their clients. You have to go to the exchange with the best price even if you think it is a tinpot exchange and not necessarily in the best interest of your client. The delays inherent in IEX should not force that upon the required parties.

That is kind of interesting as I don't think it even makes sense to be an exchange if your quotes are not protected quotes. It just makes you an ATS. Also I don't think the SEC even has the latitude to make such a ruling within the context of Reg NMS. This would mean that the SEC can't give IEX exchange status. However I think this reflects poorly on Reg NMS rather than IEX. I think IEX should be allowed to be an exchange with the basic conditions I've cited. Likewise participation in the consolidated tape revenue should be seen as problematic for IEX due to their delayed quotes.

Other arguments

Some people think the 350 microsecond delay IEX put on their system through a common POP in NJ should be enough to kick them from consideration. Reg NMS doesn't support purposeful delays. IEX replied that exchanges already delay in their co-location centres by having standard cable lengths and thus delaying some participants for fairness. Both sides seem a bit wrong there. The 350 microsecond delay is not comparable to the around 300 nanosecond delay implied by extra cable length. There is a 1000 times difference. Hardly comparable.

Even so, 350 microseconds of delay should not be a big deal in the current Reg NMS context. It is perhaps stupid but I don't think it should be considered improper. The fairness philosophy is a good one, not because others do it at 300 nanoseconds, but because it is a good thing.

At one level the 350 microsecond delay, thanks to the magic shoe box, is the equivalent of making the IEX system a co-location facility the size of NJ. That is, just a slow exchange for all. However the differential use of faster data within IEX, such as with DPEG and their routing, makes it quite a bit different in some regards.

Where I think there should be traction in the voice of disapproval is that IEX is essentially a slow exchange. IEX provided numbers in their application and you can go and look at the cute graphs. I don't like the idea that slow exchanges should be approved and gum up the system but there is no regulation against it. Reg NMS is certainly not really designed for protected quotes coming from Chicago nor the West Coast, let along for slow exchanges near NJ/NY like IEX. In Reg NMS there is verbage of the form that as long as something happens in the last second things are OK. A whole second. How quaint. There are 1,000,000,000,000 picoseonds in a second. Reg NMS needs some revision.

There has been much talk around having a minimal latency threshold, such that platforms shouldn't be allowed that slow the NMS down, but that regulation doesn't exist. I personally think something harsher should exist so that if you are below the current median performance of all exchanges you shouldn't get a guernsey on the basis that you are not improving the system, you're making it worse. That is not a thing. I also think there are too many exchanges and they should be more rigorously controlled but that is also not a thing. These are problems with IEX's application but they are not IEX problems. They are problems with Reg NMS and it would not be fair to exclude IEX on this basis.

Reg NMS has resulted in a pretty good system. As good as the NMS is, it has issues that could be improved upon. The bottom line is that there are worse existing problems to be found than those in IEX's application.


In summary, IEX should be allowed to be an exchange subject to the B/D conditions and without being allowed protected quote status. However I don't think this is possible within the current regulatory framework. Such an approval is likely to be unlawful. I guess we'll have to wait and see. The people at IEX are good people and deserve the status they are seeking so let's hope they can make some headway in reforming the system eventually.

After all, it is wrong to deny people the good grace of capitalistic failure.

Happy trading,


Thursday, 10 December 2015

There you go: speech recognition solved

Deep Speech 2 architecture
(click to enlarge)
Just "Wow!" results from Andrew Ng and the team at Baidu. The first significant publishing of human competitive speech recognition performance is a real breakthrough, even if other non-public results may be lurking.

The paper is, "Deep Speech 2: End-to-End Speech Recognition in English and Mandarin"  by Baidu Research – Silicon Valley AI Lab∗, Andrew Ng, etal, pushed to arXIV recently.

Google with Geoffrey Hinton, Andrew Ng, and others started much of the ball rolling with outstanding ImageNet results that are now human competitive. The father of getting Fukushima's Neocognitron from 1980 to evolve to learning as a convolutional neural net, Yann LeCun, has his team at Facebook beating human level performance on facial recognition. So, automatic speech recognition (ASR) getting to human level performance is not unexpected, but it is still a major achievement with enormous ramifications for the way we will work and interact within the world.

From the introduction,
"The Deep Speech 2 ASR pipeline approaches or exceeds the accuracy of Amazon Mechanical Turk human workers on several benchmarks, works in multiple languages with little modification, and is deployable in a production setting. It thus represents a significant step towards a single ASR system that addresses the entire range of speech recognition contexts handled by humans."

A nice grab from the paper showing human competitive performance.
(click to enlarge)
From the conclusion,
"End-to-end deep learning presents the exciting opportunity to improve speech recognition systems continually with increases in data and computation. Indeed, our results show that, compared to the previous incarnation, Deep Speech has significantly closed the gap in transcription performance with human workers by leveraging more data and larger models. Further, since the approach is highly generic, we’ve shown that it can quickly be applied to new languages. Creating high-performing recognizers for two very different languages, English and Mandarin, required essentially no expert knowledge of the languages.
We believe these techniques will continue to scale, and thus conclude that the vision of a single speech system that outperforms humans in most scenarios is imminently achievable."
Much still to be done, but that is just work. Exciting times.


Low cost e-commerce not possible in Australia

I wished to try out a PAM8403 audio amplifier IC. It's a modest 3W class-D audio amp that is very common. So onto E-Bay and Alibaba to have a look for an inexpensive module. The picture here shows the most common form factor I see. I ordered one from Shenzhen and hope it turns up like all the other little $0.20 to $2.00 items that magically materialise, usually at 6AM, by the front door.

One of the common PAM8403 modules
This module cost $AUD 0.48, including international postage, to buy and get delivered. You can do better per item if you need ten. My budget, aka wife's credit card, doesn't stretch that far.

Whilst the module may only cost a few cents to build, the total cost, module and postage, is below the rate for posting an empty letter domestically in Australia.

It is a remarkable logistics story as this is not unusual. If you're prepared to wait the 2-8 weeks for such little things, you're better off getting them from Shanghai, Shenzhen, or Hong Kong. They almost always turn up if you stick to reputable (i.e. highly rated, thousands sold) e-commerce front ends.

China Post is the real story here. They provide the smart logistics and bulk bundling that empower this machine. There is certainly a hint someone must be getting exploited in this distribution system to make it work like this, but who knows.

You can make a clever product, completely automate the build, and have competitive input costs but establishing distribution is always a problem. Direct is best for avoiding rent on distribution, but that is not always possible or wise depending on the product. What is undoubtedly true though, the spiderly low cost logistics of a China Post give SME's an unprecedented ability to start-up and grow, as long as you build and distribute from China or HK.



PS: It appears much of the credit, including for enabling ePacket in China/HK, goes to the Universal Postal Union which is now part of the United Nations. International mail was originally free when it arrived at the destination, but now there is a nett bulk weight differential paid, of approximately $1 per kg. The Straight Dope of 1990 vintage has a decent short explanation. It seems a clever hack for a sovereign nation to assist exporters take advantage of the UPU agreements, if only Australia Post could do the same...

Sunday, 8 November 2015

ITG - good recovery

The earnings call, capital management, and spin from ITG has been working well. The share price settled on Friday at $20.60 which is 63% up from the recent low.

Google finance link
The spin has been a little over the top on the so-called recovery, but that represents good work from ITG as it is their job to do exactly that.

POSIT numbers from the Finra stats, two weeks delayed, have not really recovered. Quite a bit of their loss of market share has been masked by dramatically higher market volumes across the industry assisting the revenue side of the equation. ITG mentioned on the call that the second half of October saw improvement which is not in the Finra stats yet.

We don't know if they have stopped their prop trading of US/CAD interlisted stocks as they simply stopped mentioning it, or breaking it out, in their reporting a couple of quarters ago. You'd be hoping there was no-mingling of their prop trading with their new interlisted stock service they've recently started marketing ;-)

The energy research sale was a good result. Obviously earnings going forward will be affected but they need the cash. As was pointed out on the call, the other research would be a neg profit line so it remains to be seen how that will be managed.

There remains uncertainty from the business with respect to legals with two class actions and various staff/ex-staff legal issues. This was the quote from the call,
"In connection with the SEC settlement, two shareholder lawsuits have been filed against ITG and certain current and former executives seeking unspecified damages. Separately, ITG's former CEO has filed a demand for arbitration claiming that his termination for cause represents a breach of his employment contract. This arbitration demand seeks an award of damages in equity totally approximately $8 million plus an additional $5 million in punitive damages. The Company intends to defend itself vigorously in all of these matters and we have not set aside any reserves in connection with these matters."
That Gasser remains on the board whilst suing the company is an interesting legal conundrum.

There are a lot of good staff at ITG so the recovery is good news for those deserving staff. However, how the board members responsible for authorising the SEC prop trading fiasco remain raises questions. It seems it is OK to mislead and defraud your customers as the obvious apathy in ITG's case means they don't mind too much.

Tuesday, 27 October 2015

More lies and misdirection from Exablaze & Zomojo

Exablaze / Zomojo made an improper statement regarding the legal status of the dispute with myself.

They have publicly pronounced, "This now brings the matter to a close."

This is wrong. Justice Beach was a dissenter with regard to accessorial liability, writing after Besanko & Gilmour JJ on the the Hurd Senior contempt matter, and this makes an obvious appeal to the High Court of Australia warranted.
Justice Gilmour - doing good work in the community

As anyone can see from the notes about apprehended bias, here, there are matters that are not fully resolved from incorrect interpretations, not just limited to paragraph 73, in the main FCAFC judgment. Not withstanding this, there is also a High Court worthy challenge for a clarification concerning apprehended bias as a matter of national significance with respect to the interpretation of the Australian Constitution based on the Judicial Employment Paradox I have previously discussed.

Further to this, at least one of the judges was impaired during the hearing which is yet to be challenged.

We may have many months or perhaps more than a year to go on this matter to get it properly resolved.


And now for something uplifting which my middle daughter inspired me with when we were both suffering a little (we often play it in the car now):
I heard you don't have to wear a suit to argue the truth
And so
Who are you to tell me how to live my life
Cause I won't give this up
These are my shoes
My view
My cue
To say I do give a fuck

Sunday, 25 October 2015

Corruption, Zomojo, Greg Robinson, Gordon J, and the Federal Court

The tragedy of the commoner.

My appeals raised last year and heard on March 3 & 4 had their judgments handed down last week. The judgments were harsh, beyond reasonable belief, and riddled with errors, inconsistencies, and invective.

My first reaction was to be pretty pissed off. Now a few days have passed. The blood simmers rather than boils. I find myself reflecting on how it could go so wrong. It may have been a reasonable result for the JJs to say, “as a self-represented litigant you're an incompetent fool” and dismiss the appeal. I could have respected that.

They did not. They piled on unreasonable and malicious reasoning with intemperate language and flawed logic.

The first question that comes to mind is that is the system a giant conspiracy and out to get me?


The second question to ask is if the JJs are bad judges, full of malevolence, and corruption?


These judges are good people.

Gilmour J was distracted, inattentive, and somewhat regard free. Beach J was impressive but clearly prejudiced. Besanko J simply did not care enough to seek the truth. Nevertheless I've seen the work they do and these are good people who work hard for what they see as justice.

The question remains that if these are good people that made such a malicious judgment, where did their motivation come from?

It's pretty simple on reflection.

Honourable Justice Michelle Gordon's original bias and toxicity has simply infected everything that has subsequently flowed. The JJ's simply believed in Gordon's findings and felt they were doing society and justice a favour by burying me. Hurd the toxic, begone.

The conclusion is pretty simple to reach as you can see in paragraph 73 of their judgment they had no basic understanding of the case. They simply didn't bother. The case seemed to be deemed a distraction from a self-represented litigant who was calling out a biased judge, their friend and colleague. The matter was heard at the end of their appeal circuit and was simply a puss filled boil that was preventing the closure of their junket and further time at the bar. They lanced the boil.

The judges certainly believe they have done the right thing with their inattentive misunderstanding. It is a shame that the legal system works, or fails, in this way.

Davies J decision in 663/2013 was much worse and more perverted but more understandable as Her Honour was:
  1. being fed by corruption within due to Registrar Burns being a friend of Robinson;
  2. worked with Gordon J in the same small department in University Melbourne Law; and, 
  3. no doubt “owed” Gordon J somewhat due to not only the friendship but the recent appointment to the Federal Court and assimilation.
The JJ's decision is simply on the same progression. No understanding of the case and a desire to project a protective shield over criticism of the court and the influential Hayne & Gordon power couple.

The whole saga is representative of the corruption in society that is prevalent when institutions mature and the politics of appointment and favour move the dial from the meritorious to the connected. Australia has long been far from the egalitarian ideal we often fool ourselves into believing. This case shows just how that corruption has become endemic to our society. Not the graft, $ in hand, kind of corruption, but the connected, influence, self reinforcing favour, and status kind of corruption. This case has to be the poster child for exactly that decay. The country is unsafe.

There can be no expectation of public confidence in the legal system.

Australia is dead.

Fiat justitia,


Some details on the apprehended bias I failed to fight against:

Even though Zeptonics and Zomojo are based in the Sydney, the matter is raised in Melbourne.

Robinson has prior boasted of the influence he can bring to bear in Melbourne but there seems little to worry about as the case is largely without merit.

Honourable Justice Michelle Gordon has the case.

Her Honour's husband Honourable Justice Ken Hayne is a High Court of Australia jurist. Hayne is a good mate with the Governor of Victoria, Hon Alex Chernov, both being ex Vic Supreme jurists. Hayne swore in Chernov as the Administrator of the Commonwealth of Australia, for example.

Bill Burdett, Zomojo beneficiary or shareholder, friend of Robinson, works in an excellent charity, Friends of Asha, alongside Chernov.

Greg Robinson and Bill are ex-ITG folk. Bill was on the NY board as a Director, Asia-Pac chairman, and Greg ran ITG Asia-Pac as CEO. I met them in 2005 when I was looking for a job and ITG was considering using me to set-up a prop trading biz in Sydney to complement their existing prop trading in the US and Canada. Bill and Greg decided to take the opportunity for themselves instead of ITG which is how Zomojo was born with me starting up with their capital investment.

Still, these connections the Zomojo guys have should be not that much of a concern, should they? Justice should still work?

The judge Michelle Gordon, works at Melbourne University. Greg Robinson's wife, Patricia Desmond works at Melbourne University as a Prof and runs a medical department there. That's a bit more of a worry. Two senior and powerful University women.

Greg and his wife have donated at least $300,000 to the university and mix it with Gordon and her ilk at the university, including Michael Robinson AO, Gordon's former boss at Allens. Then again, maybe they don't even know each other?

Greg's wife has done work for Michael Robinson AO at his health concern, Epsworth Medical Foundation, he chairs. Patricia has invited him to gala dinners. Perhaps they do know each other after all.

Greg Robinson provides an affidavit that says he had lunch with Michael Robinson at the men's only Melbourne Club.

It turns out Hayne J has a bunch of golf buddies, from that den of paedophilia known as Scotch College, that he plays weekly golf with and some of them, such as Robyn Syme, are mutual friends of Zomojo's legal team (including Janet Whiting), Greg Robinson, or Bill Burdett.

The Melbourne club is a tight knit group and all these people know each other and hangout in the same circles. National Gallery of Victoria. National Australia Day Council. They bump around and feed off each other. That is not that much in itself but the donations of at least $300,000 to the university seem to raise a bit of a worry as, in effect, Robinson has been giving money to the judge's employer. This seems a conflict too far.

Now the original case was run in October 2012. In 2012 a lass by the name of Kate Dillion (nee Desmond), a close relative of Greg Robinson and his wife Patricia Desmond, was awarded the Melbourne Law School Masters Award – Davies Collison Dave Prize for 2012. So, Gordon J's school gave Robinson's relative, where he donated lots of money, a prize. No influence?

It should seem to you less and less likely that a fair trial could be in the offing.

Now the Zomojo barristers are Dr Matt Collins SC and Dr Michelle Sharpe. They seem good people whereas Janet Whiting and Matthew Critchley, Zomojo's solicitors, are outright lying scum.

Hold it a sec. Matt Collins works at the University of Melbourne Law School. Michelle Sharpe has worked there too. Goodness, how far can the conflicts lead us? Really, should it be allowed that it is appropriate for both opposing counsel to work with judge? What the ????

No wonder Zomojo's counsel is so favoured in trial by the judge despite their lies. They are colleagues and friends of the judge!

We get an answer to an interlocutory application, including a Robinson affidavit, before it has even been stamped and received by us. That is strange as it has certainly not been served. We complain. We get another copy of the interlocutory application, this time with a new date stamp on it back dated to the prior week. Hmmmm. Something fishy is going on in the Victoria Registry. Smells of a little corruption.

In VID 663/2013, the Zomojo liquidation matter, Registrar Burns is actingy harshly and weirdly against us prior to trial. Burns declares that Greg Robinson is a friend on the Friday before trial. He does not recuse himself and continues to act against us. This perhaps explains why information and documents have been leaking to the other side all this time. Moles, leaking, favours, corruption. What the ???? Seems a little ridiculous. Why is this case so special?

Besanko, Gilmour, and Gilmour JJ's have ruled this is perfectly OK. Even though, Gordon J acted harshly against us, ignored evidence, granted mistake riddled subpoenas to Zomojo whilst being a pedant with ours, changed the procedures on the fly in favour of Robinson, hardly granted us any objections and granted almost all of theirs, even ignoring evidence that didn't suit Her Honour's prejudice along with many "inconvenient" legal submissions and precedents… there was no possibility of impartiality.

Some of these facts only became known this year, but then again, we should have known we were in trouble when Gordon J made snide remarks about New South Welshmen in court. It was unlikely to end well, and it did not.

The system is corrupt.


Sometimes they try to break me down
Other times I feel safe and sound
And I don't know why I'm weightless now
But I'm guessing it's because we're running on air

I was told that life is as easy as can be
But apparently the tragedy is freedom isn't free

Thursday, 22 October 2015

Exablaze & Zomojo's Greg Robinson identified as a liar by the Federal Court

Some small solace in my continuing battle was that Dr Greg Robinson, former ITG Asia-Pacific CEO, current Chairman of Exablaze and Zomojo, was found to be a liar by the Federal Court of
Exablaze's Greg Robinson?

Small beer in the greater scheme of things perhaps, but it is the first acknowledgement by the court of the fact that Greg Robinson is an unsavoury character.

From paragraph 87,
"What this sequence discloses is that there was a genuine credibility issue that was raised with Dr Robinson on this matter.
This is legal speak for unctuous lying scum. Strangely, the court concludes that the issues of credit with Robinson are of no consequence. Yep. Bizzare. Just as court also concludes that the fact that Mr Matthew Critchley of Corrs Chambers Westgarth lied to the court is of no consequence.

Despite such activity being a criminal offence, the lesson clearly is that it is best to lie as often and advantageously as possible to the court as there are no consequences.
Caveat emptor,
PS: I've previously written about part of this here: Corrupt lawyers - why you should seek them out.

Hurd hit with a suppression order from Federal Court

Apparently the evidence given in my sworn affidavit to the Federal Court of Australia's appeal court is so controversial it had to be placed under a suppression order preventing its publication so that the world would not stop spinning.

Cronyism, bias, corruption, and cover-up is alive and well in the Federal Court of Australia.

The details of the order made by Honourable Justice Beach read:
  1. Pursuant to s 37AF(1) of the Federal Court of Australia Act 1976 (Cth), subject to further order the affidavit of Matthew Hurd sworn on 5 January 2015 together with the annexures be prohibited from publication.
  2. The ground upon which order 1 is made is that contained in s 37AG(1)(a) of the Act.
As far as I know, there is no order preventing the publication of this non-publication order.



Grounds for making an order
             (1)  The Court may make a suppression order or non-publication order on one or more of the following grounds:
                     (a)  the order is necessary to prevent prejudice to the proper administration of justice;
                     (b)  the order is necessary to prevent prejudice to the interests of the Commonwealth or a State or Territory in relation to national or international security;
                     (c)  the order is necessary to protect the safety of any person;
                     (d)  the order is necessary to avoid causing undue distress or embarrassment to a party to or witness in a criminal proceeding involving an offence of a sexual nature (including an act of indecency).
             (2)  A suppression order or non-publication order must specify the ground or grounds on which the order is made.