The fastest possible computers are located adjacent to the computers that receive orders at the stock exchanges, and I when I say adjacent, it's not the building next door, it's literally feet away. This world operates in milliseconds, and even the speed of light in a fiberoptic cable is not fast enough for anything other than colocation.
I don't want to go into the argument for and against HFT, but I want to show you what it looks like. The attached table and chart are the New York Stock Exchange Tick Indicator. Tick is defined in the following manner. If a stock trades up from its last trade, that is a positive tick. Down, it would be a negative tick. The Tick Indicator simply sums up all the positive and negative ticks on all the NYSE stocks and reports that number every 10 seconds. (At least my software reports it every 10 seconds.)
The table includes all reported ticks from 10:00 to 10:06 this morning. The column on the right is the difference from the tick reported 10 seconds earlier. The chart is the difference column. As you can see in this 7 minute period, the tick swings wildly back and forth from a high of 580 to a low of -318. Remember, those are 10 second swings.
Folks, It's not people doing this. This is HFT at work. Is it just noise? Does it really matter? Obviously it matters to the people doing it because they are extracting profits from somebody. Who that somebody is, I am not sure, but with the very sour attitude toward Wall Street on Main Street, I can't imagine that Congress will not want to investigate. If you haven't heard of HFT before, you will in the future.