Read the passage below and identify the author's primary evaluation:

"Algorithmic trading systems execute transactions in nanoseconds, providing capital markets with high liquidity. However, this hyper-speed liquidity is notoriously fragile; in moments of systemic market stress, algorithms withdraw quotes simultaneously, exacerbating 'flash crashes' that threaten real-economy stability."

The author evaluates algorithmic trading liquidity as:

Answer and explanation

Correct answer: C. abundant during normal conditions but dangerously fragile during market stress

  1. Step 1: Trace the nuanced assessment: high-speed algorithms provide liquidity under normal conditions, but 'this hyper-speed liquidity is notoriously fragile', withdrawing quotes simultaneously during stress and creating flash crashes.
  2. Step 2: The evaluation is that algorithmic liquidity is superficial and prone to vanishing when most needed.
Answer
abundant during normal conditions but dangerously fragile during market stress.
Why not the others: 'permanently stabilizing and capable of preventing all financial recessions' contradicts the warning about flash crashes; 'completely nonexistent even during ordinary daily market transactions' contradicts the acknowledgment of high normal liquidity; 'unconditionally superior to all historical modes of human stockbrokerage' overlooks the grave stability risks highlighted.

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