You said that HFTs jump out when things get volatile. But then I show you evidence that they trade more in high volatility. Do you not see the contradiction?
> HFT is hugely expensive to maintain. Staffing and equipment costs are massive.
HFT firm equipment costs are a few racks of high end servers and some expensive networking equipment, and a few dozen to few hundred highly paid engineers. Before HFT there were literally _thousands_ of human traders working at different banks doing the same work by hand. Sure in an absolute sense HFT is expensive, but relative to the alternative it is cheap.
> HFT choose not to trade on exchanges with delays because they want to exploit latency advantages. That's why govt should regulate this on all exchanges to just wipe it out.
If HFT is so bad, then the non-HFT market participants should choose to trade at the delay exchanges that make it harder for HFTs. But they choose not to, generally, because the liquidity - and thus trading costs are higher than trading at the non-delay exchanges.
> Consolidation is not good because it will collapse into a monopoly. Which will require regulation also, because markets do not "work" on their own.
First you say that HFT is bad because costs are high, but now you say that falling costs are bad because it will lead to monopoly - do you see the contradiction? For what its worth, Although there are fewer firms there is still a lot of competition among the remaining firms.