Stock Exchanges Don’t Have To Do Thing They Very Much Don’t Want To At Their Own Expense

It’s been a good week for the New York Stock Exchange. It moved on to the second phase of its reopening, with a handful of market makers rejoining the handful of floor traders who’ve been pacing the iconic space at a safe distance from one another for three weeks now. Those market makers will be allowed to take the subway to work, as well. And even the bad news comes with a silver lining: Sure, the Nasdaq has been crowned the coronavirus IPO king, but the Big Board is confident that once all this settles down, people will come back to daddy.

And it’s getting better: A court has said that the Securities and Exchange Commission can’t force the NYSE to run a very expensive experiment that could prove even more devastatingly expensive in the long run if it should find what everyone expects it would, which is that the rebates exchanges pay to brokers who send them lots of orders are perhaps not in the best interests of customers, and the NYSE’s very own U.S. senator had another cloud lifted from her sputtering reelection bid.

“The Pilot Program emanates from an aimless ‘one-off’ regulation, i.e., a rule that imposes significant, costly, and disparate regulatory requirements on affected parties merely to allow the Commission to collect data to determine whether there might be a problem worthy of regulation,” the court said.

The pilot program, which was recommended by an SEC-appointed committee of market experts as well as the U.S. Treasury, would have tested banning rebates for certain stocks and lowering exchange transaction fees for others.

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Stock Exchanges Don’t Have To Do Thing They Very Much Don’t Want To At Their Own Expense