[nhaehnle]

My totally abstract reasoning is like this: For markets to function well, the barriers of entry must be as low as possible.

The possibility of HFT raises the barriers of entry. Therefore it causes at least some bad.

Personally, I think the markets should just operate at, say, 15 minute heartbeats. Anybody is open to place orders at any point in time in secret. Then, at a predetermined heartbeat time, all orders are revealed and some standard auctioning mechanism is used to match them up against each other.

Sure, spreads would be larger than they are now, but at the same time there would also be less volatility by definition. More importantly, barriers of entry would be much lower, which will cause the market to function closer to a "perfect market" over time.