'Downtown' Josh Brown on 'The Reformed Broker,' His New Book and High Frequency Trading

“Downtown” Josh Brown, CEO of Ritholtz Wealth Management, frequent CNBC contributor and author of the widely popular financial blog, 'The Reformed Broker,' was a guest on Benzinga's #PreMarket Prep show this week to talk about his blog, new book and high frequency trading.Brown loves telling the story of starting his blog. It's not a nice story, he said, but at least it has a happy ending. When he started the blog, Brown was a retail broker. It was close to the bottom of the market in November of 2008, and his business had fallen apart. “I was probably at the very bottom in terms of where i was with my career, where I was with my emotional state, my marriage,” he said. Related: Ronnie Moas' Latest Update On Blacklisted StocksBrown was the branch manager of a regional brokerage firm, and the businesses of all the people he supervised were falling apart, too. He started 'The Reformed Broker' as a place to vent and rant. But the blog caught on really quick, Brown said, “for whatever reason.” “I think most of the people who were reading it were other brokers, who I guess could relate to the frustration and the toxic stuff that I was putting out there, and that was just very real and different from what else was being published about the crisis -- about the markets,” he said. And it took off from there to become one of the most widely-read blogs in today's financial sphere. He's had the blog for about five and a half years now, and said his traffic keeps growing. Clash of the Financial PunditsBrown also recently wrote a book with Jeff Macke, host of Breakout on Yahoo (NASDAQ: YHOO) Finance, called “Clash of the Financial Pundits: How the Media Influences Your Investment Decisions for Better or Worse.” The idea behind the book is to help investors by giving them the context they need to become a bit savvier about what goes into the news each day and how to consume it the right way. Brown comes from the unique position as somebody who spent a lot time consuming the opinions of financial experts, and then switching to the other side and becoming a financial pundit, himself. Brown said the media diet of not paying attention to the news at all is only great advice if you're planning on being on a desert island or in a coma for the next twenty years. Ignoring all economic, geopolitical and financial news isn't plausible. The best thing to do, Brown said, is to become a better consumer of it. The book tries to help investors do this through two facts. First, there are interviews with leading financial pundits of the modern era, including Jim Cramer, Herb Greenberg and Barry Ritholtz, who each give their own unique take on the benefits and drawbacks of the mediaRelated: Herb Greenberg Talks Michael Kors, SolarCity and Share BuybacksSecond, the authors go back in history and look at the greatest market pundits and the moments that they inhabited -- the crashes of 1987 and 1929, the bear market of the 1970s, etc. It also examines how people's opinions affected the markets, themselves. “I think by the time you finish the book, you're probably going to be a lot more worldly, and lot more savvy when you come into contact with financial media going forward,” Brown said. High Frequency TradingBrown was direct about his feelings on high frequency trading. “The market is rigged,” he said. “The market has always been rigged.” Even before the New York Stock Exchange was created, there were merchants in the early 1700s who traded securities on Wall Street, Brown said. In an effort to box themselves in and keep outsiders from having power over securities trading, these merchants essentially formed their own “clique” and would only trade with people who abided by their rules. The rules were, of course, rigged in their favor, Brown said, and they ended up being the original seat holders of what would become the stock exchange a hundred years later. “At the end of the day, this thing started off rigged. It will always be rigged. There will always be a contingent of people who reap an asymmetric benefit relative to the rest of the crowd. And my answer to that is, ‘Who cares?'” Brown said. “If you're really trading because you think you have an edge on a penny-by-penny basis, well, then it's a problem for you.”Brown's advice is to not compete on a short-term horizon. “The way to defeat high frequency traders is to be a low frequency trader, plain and simple,” he said. Check out his interview here: