Matthew Goldstein, the Reuters columnist who recently broke the Goldman Sachs code-theft story, has a good column today keeping alive (at least in the mainstream press—the blog Zero Hedge has been all over this for weeks) the serious issues it raises about automated trading, also known as high-frequency trading.

As Goldstein says:

But this strange Wall Street crime story isn’t just about one man’s guilt or innocence. The case should also serve as an alarm for securities regulators to start taking a close look at so-called high frequency trading and the impact that this speed-of-light trading strategy is having on the markets.

After all, if a computer code is valuable enough for someone to steal, and critical enough for a Wall Street firm to go to federal authorities to protect, one would think that regulators would want to know why it is so important.

Which means that Goldstein thinks regulators don’t know how these things really work—something that wouldn’t exactly be a shocker.

He reports that automated trading now accounts for the vast majority of trades on the stock exchanges these days—73 percent in the U.S.—and that the firms who do it are notoriously secretive. It’s not just Goldman Sachs:

The vast majority of hedge funds and trading firms that engage in high frequency trading — Citadel Investment Group, D.E. Shaw, Global Electronic Trading Company, Renaissance Technologies and Wolverine Trading — are private and don’t reveal much, if anything, about their operations. Even a public company like Goldman, an acknowledged leader in high frequency trading, is silent on the profits it generates.

Goldstein raises the prospect of a high-frequency-trading-induced crash:

The big fear is that with high frequency trading dominating daily trading activity, it could spark another 1987-style market crash. The doomsayers say that could occur if all these automated trading programs — which operate with almost no adult supervision — begin reacting to the same downward price trends in a stock or commodity. Or high frequency trading firms could worsen a sell-off by refusing to execute trades to protect their own capital, a move that would make it difficult for other investors to quickly exit a falling stock.

And he quotes a Georgetown prof using a specific stock that crashed 69 percent as an example of how high-frequency trading may be affecting markets.

Goldstein doesn’t repeat it, so I will (again): The prosecutor in the Goldman software-code theft said that the program could be used to “manipulate markets in unfair ways.” He was talking about it falling into the wrong hands. But what’s to prevent Wall Street from doing that? That’s something like the stock in trade there. Even when they’re caught, they usually just face a few-million-dollar fine, maybe a wagged finger, and then it’s back to business.

How much do authorities know about what these folks are doing? When are some SEC and NYSE reporters going to hop on this story and dig us up some answers?

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Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.