It looks as though this whole Flash trading controversy may have a simple, private sector solution, not requiring action by the SEC.

The NASDAQ says it’s eliminating Flash trading as of Sept 1. Flash trading allows some traders to get a sneek peek at big oders before others — defenders argue that it’s logical to give "local" traders, who are set up nearby a look at trades before they go out to the broader market. Either way, our guess is that this won’t prove to be a big deal, though it may cream some hedge funds.

If Flash orders had a significant impact on liquidity, the NASDAQ wouldn’t be doing this voluntarily.