> 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?

We should distinguish between volatility at different timescales. An HFT might well be very active over a volatile month, but may still turn off over a very volatile second. I've always assumed that the "HFTs jump out during volatility" complaint was about the latter; it means that when some shocking news hits the market, the HFT firms providing most of the liquidity pull it, and so the manually-entered market orders wanging around end up moving the market further, exacerbating the volatility. Maybe that's not what people are actually complaining about, though.

> HFT firm equipment costs are a few racks of high end servers and some expensive networking equipment

And FPGAs. FPGA development is really not cheap.