[slv77]

Money sitting in a bank account is invested via loans and gets returns via interest. If the bank is savvy and makes good investments they keep the spread between the interest paid and the interest earned.

From the perspective of the business owner it matters little of the cash comes from a bank or as an equity investment. The cash spends the same and they will prefer whichever they can get that is most favorable to them.

Even though public equities get all the news they are a relative latecomer to the party and are frankly a pimple when compared to the bond and cash market. Even if the entire public market disappeared tomorrow the vast majority of companies would have no issue raising cash either through private equity, bonds or bank loans.

Almost all (99.999999+%) trades on the public market have nothing to do with raising corporate equity (i.e. newly issued stock) and instead are transmitting price information about the markets current beliefs about potential future earnings. That is valuable in aggregate because it allows good companies with strong prospects to raise funds at a lower cost (if needed).

But is transmitting pricing information around the globe via dedicated links to shave off tenths of seconds really necessary? Does any company need to raise funds at a micro-seconds notice?

After all the markets close at the end of the day but somehow the world continues to function for the next 16 hours without sub-second pricing information at everyone's fingertips.