Last month I read Michael Lewis' “Flash Boys: a Wall Street Revolt,” in which the author of “Liar's Poker,” “Moneyball” and “The Blind Side” argues that high-frequency trading has created a rigged game on Wall Street, in which high-frequency traders can utilize faster speeds to figure out what we're doing before we do it, then act as middlemen in the transaction: buying what we were about to buy and selling it back to us at a higher price. Basically they're front-running trades. Legally.

But there's been pushback against the book by, among others, Andrew Ross Sorkin of The New York Times. I meant to check out his critique after reading the book. I finally did this week.

Sorkin basically agrees with Lewis that there is a problem and the game is rigged, or “rigged”: “(There remain a host of other problems that still make it 'rigged'),” he writes. He just feels Lewis is blaming the wrong people:

He points mostly to the hedge funds and investment banks engaged in high-frequency trading. But Mr. Lewis seemingly glosses over the real black hats: the big stock exchanges, which are enabling — and profiting handsomely — from the extra-fast access they are providing to certain investors.

Of course Lewis does write about the exchanges, particularly Bats. In fact, the whole narrative of the book is built around the creation of a new exchange, IEX, one designed to be more fair—to offer, in a sense, exchange neutrality.

Even so, it's interesting that Sorkin agreed there was a problem. So I assumed he'd written about high-frequency trading before.

He has. A search on the Times website (for “high frequency trading” and “By Andrew Ross Sorkin”) yielded, when you parsed out the Dealbook/Times duplicates, three results.

The first, “A Lack of Transparency In S.E.C. Disclosure Rule” from November 2010, is about the troubling way the SEC allows corporations to release their earnings reports: on their website rather than as a press release issued simultaenously to hundreds of news services. The HFT reference? About halfway through:

In an age of high-frequency trading when every millisecond counts — even in after-hours trading — the move toward companies’ distributing earnings and other market-moving information via their Web sites rather than through wider distribution channels raises some serious questions about transparency. 

It's the super-fast age we live in. But there's no critique of it. 

The second column, “Volatility, Thy Name is E.T.F.” from October 2011, deals with the new volatility of the stock market, including the flash crash of May 2010. The HFT reference? That it wasn't the problem. 

The third column is his critique of Lewis and “Flash Boys.” He calls the book important. He writes this:

Mr. Lewis’s well-crafted narrative highlights a perverse system on Wall Street that has allowed certain professional investors to pay hundreds of millions of dollars a year to locate their computer servers close to stock exchanges so they can make trades milliseconds ahead of everyone else.

In some cases, the superfast investors are able to glean crucial information from the stream of trading data flowing into their systems that allows them to see what stocks other investors are about to buy before they are able to complete their orders.

Then we get the line about the wrong villains: the exchanges, not the bankers.

Sorkin, in other words, isn't saying there isn't a problem. He just implies that Lewis is clever, hyperbolic, and demonizing the wrong group of people about this problem ... which he, Sorkin, has never bothered to write about.

Sign of the times.