Markets that are less efficient in that task hurt long-term retirement investors and day-traders alike.
On some level this is true, but the insane quantities being siphoned out of the economy through the financial system is wildly disproportionate to the increasingly-infinitesimal gains in “price efficiency”.
As a long-term investor in the market as a whole, whether Apple’s true per-share value today is 175.01 and not 175.07 is almost completely irrelevant. Even less so the difference between 175.008913 and 175.008916.
We have long since passed a point where there is sufficient liquidity and sufficient price discovery for the purpose of buy-and-hold investment, and every extra dollar that goes to financial services in the name of more accurately determining prices is just a transfer of money from people who provide value to the economy to a class of leeches who provide nearly nothing.
Btw., no-one is forced to trade incessantly, either.
A spring only suspension system responds quickly to a bump in the road. If that’s your only metric, it’s good. But a car without a damper is going to be hella uncomfortable. The shock makes it respond slower - it doesn’t mean it doesn’t respond.
The point of governance to some extent is dealing with the tension between what competing groups of people say they want and actually need