As luck would have it, one of my best guys is a former MM -ish trader on the CBOE.
For whatever it's worth: total agreement with you that GS isn't acting as a MM (after an earful about delta and position risk and volatility risk and long strangles and gahhhhh). He says "GS is a BD, MM's can't trade for clients" and a bunch of other stuff.
You are 100% right. GS is not a market maker. "Doing trades that help provide liquidity to Facebook instruments that somehow down the line helps build a market for Facebook" is in no way the same thing as "being a market maker". People should stop saying "market maker" when they mean "market helper" or something else.
On the other hand, had no clue what a hidden quantity was; neither did my exchange engineer friend. So I feel a little less dumb. He knew what an iceberg order was. Also, note that there's at least one exchange that doesn't draw a distinction.
For whatever it's worth: total agreement with you that GS isn't acting as a MM (after an earful about delta and position risk and volatility risk and long strangles and gahhhhh). He says "GS is a BD, MM's can't trade for clients" and a bunch of other stuff.
You are 100% right. GS is not a market maker. "Doing trades that help provide liquidity to Facebook instruments that somehow down the line helps build a market for Facebook" is in no way the same thing as "being a market maker". People should stop saying "market maker" when they mean "market helper" or something else.
On the other hand, had no clue what a hidden quantity was; neither did my exchange engineer friend. So I feel a little less dumb. He knew what an iceberg order was. Also, note that there's at least one exchange that doesn't draw a distinction.
That was fun, thanks!