Things you can do with that 10us advantage like frontrunning are parasitical, but why is a speed advantage itself a bad thing?
Surely waiting a day to act on the information isn't helpful. How about a minute? A few hundred ms, about the speed of a conscious awareness? Getting down to 10us seems like the logical conclusion of all this.
I think the more nuanced view was talked 3/4 of the way down: with algo trading, prices are based on the models not the fundamentals. And then you add in models of what the other guys are doing. And pretty soon you don't care where the price should be, you just care about computing in 10us where everyone else thinks it's going to be in 15us.
> Another fallacy in the lead-up to the financial crisis was the assumption that financial markets were so efficient that participants didn’t need to do the underlying work to figure out what the securities were actually worth. Because you could rely on the market to efficiently incorporate all available information about the bond. All you need to think about is the price that someone else is willing to buy it from you at or sell it to you at.... if they assume that the price of an instrument already reflects all of the information and analysis that you could possibly do—then they are vulnerable to that assumption being false.
That's now flash-crash territory.