Joseph Stiglitz off SEC panel after stance on high speed trades

WASHINGTON: Joseph Stiglitz, the Nobel laureate economist who called for a tax on high-frequency trading, has been blocked from a government panel that will advise regulators on issues facing US equity markets, according to people familiar with the matter.

Stiglitz's rejection shows the partisan infighting that has bogged down Securities and Exchange Commission chair Mary Jo White's plan to set up a panel of experts to advise the agency on topics ranging from rapid-fire stock trading to dark pools.

Republican Commissioner Daniel Gallagher opposed Stiglitz's nomination in recent weeks as White sought to complete the list of participants, according to two people who asked to not be identified because the deliberations were private. Democratic Commissioner Luis Aguilar had pushed for Stiglitz, who has said high-frequency trading isn't good for financial markets and should be curbed, possibly through a tax.

“I think they may not have felt comfortable with somebody who was not in one way or another owned by the industry ,“ Stiglitz said in a phone interview.

White said on January 3 that she will announce the members of the advisory market-structure committee in coming days ­ six months after she first proposed the idea together with a blueprint for renewed market oversight.Each of the five commissioners ­ two Democrats, two Republicans and White, an independent ­ was allowed to nominate one person to the panel. The commission then had to come to agreement on the final list.

Gallagher declined to comment on the panel, as did Gina Talamona, a spokeswoman for White.

More Opposition

The panel is expected to include representatives of Wall Street brokerage firms and academic researchers. IEX Corp CEO Brad Katsuyama is expected to be named to the panel, two people with knowledge of the matter said.Katsuyama garnered attention as a key figure in “Flash Boys“, Michael Lewis' 2014 book about highfrequency trading. He started the IEX trading platform with the aim of leveling the playing field for investors.