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Firms race to transmit Wall Street data at nearly light speed

Strike Technologies and others are working to build networks of super-fast microwave radio transmitters linking the world's financial hubs.

November 29, 2013|By Andrew Tangel

Chilton, the CFTC commissioner, said talk of microwave signals' use in trading "blew me away" when he learned of it. Although he has stopped short of calling for slowing down markets, he has called for safeguards to prevent meltdowns.

"When things go wrong, they go wrong in a huge hurry," he said. "As a regulator, we will never be able to keep up with these super-fast traders."

Strike, for its part, also offers software for high-frequency trading that aims to prevent super-fast computer programs from throwing a wrench into the financial markets.

"Any exchange blowups, private firms, public firms blowing up — that's terrible," Rubenstein said. "We all should care about market stability and how to avoid problems."

Wall Street firms are nevertheless plowing forth with plans for new microwave links.

Rubenstein's company is planning other "long-haul" links, including one between Mahwah, N.J. — home to the NYSE's data center — and Chicago.

McKay Bros., an Oakland firm that linked up financial data centers near New York City and Chicago a year ago, is also planning to build a microwave connection from Mahwah.

Some large investment firms have established their own microwave links from Washington, D.C. They zap valuable government data — like the U.S. Labor Department's monthly unemployment report — to Chicago and New York, industry insiders say.

Tech firms, meanwhile, are trying to hone microwave technologies to make signals even faster.

Improvements probably will shave off more time in coming months, said Bob Meade, co-founder of McKay Bros.

"You'll keep approaching the speed of light over time," Meade said. "At some point, it will be so little that it doesn't matter."

andrew.tangel@latimes.com

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