Imagine liquidity as tank full of fuel in your car. The possibilities of going with a full tank are endless. More fuel than tank's holding capacity is pretty much useless.
No, imagine liquidity as a keg of beer. If you drink some, it tastes great. If you drink some more, you feel dizzy, and eventually you wake up with a really ugly girl in your bed.
When using analogies, some explanation is helpful.
If there are 10 people who want move to street x, having 14 sellers all selling identical apartments, at identical prices is no different than having 50 people selling identical apartments at identical prices or 200.
The difference with HFC is they don't provide any actual liquidity that matters. They don't hold the apartments across different move in dates.
Whatever number happens to mesh with the poster's predetermined position on the matter. If they think that HFT isn't "real work"[0], they'll set the level low. If they're a free-market fetishist, they'll say the tank is indefinitely large.
Metaphors are rarely a useful approach to understanding something.
[0] An amusing position for a programmer to take, considering we make completely intangible stuff while spending hours a day sitting on our asses, but one that a lot of people on this site seem to hold.
If you can think of a better term than "real participant" please let me know.
If your job is to record or settle trades, be a day trader with no overnight position, track share holdings, etc. then you are a part of the machinery of this capital market, but you are not one of the participants who provides, or consumes capital. You are part of the cost structure.
The real participants are those who actions reflect beyond the casino itself, and out into the economy beyond.
The purpose of share markets is to provide capital. Long term capital for companies to invest, and in return to provide long term profits for those providing that capital.
If you are providing or consuming capital, even for one day, you are to some extent a real participant.
I think it is fine for people to make money, brokers to charge a fee for a trade, day trading, advising on diversification, etc.. But we should understand that these are costs associated with this system of providing capital/investing.
You sound like you provide capital and participate as an investor.
When using analogies, some explanation is helpful.