[ by Howard Haykin ] At SIFMA's Tech Leaders Forum held earlier this week, strong sentiments once again were expressed about Nasdaq’s botched handling of the Facebook IPO that left investor confidence at a low point. During Tuesday's Market Structure Panel, executives from NYSE Euronext, ConvergEx, BATS Global Markets and Direct Edge all lamented the technical problems that marred Facebook’s IPO.  They emphasized that the industry has to do better in the future if it wants average investors to come back into the market.  Here's what these industry leaders had to say. Joe Mecane, NYSE Euronext:  Co-Head of U.S. Listing & Cash Execution. "Overall, I think everyone would agree, this is a black eye for the industry."  He added that while many customers have asked whether the technical failures were unique to Nasdaq, it would be difficult to say that similar problems couldn't happen elsewhere. Joe Cangemi, ConvergEx: Head of Equity Sales & Trading. The Facebook fiasco was not only a technical problem, but also a failure in crisis management.  Cangemi added:  "We as an industry failed our investors.  Not only the exchanges, but the industry in general, became perhaps too comfortable." Richard Repetto, Sandler O’Neil & Partners: Financial Services Analyst. Serving as moderator of the panel, Repetto offered an overview of what actually happened Friday, 5/18, when Facebook went public.  Though shares were initially priced at $38, traders could place orders at whatever prices they wanted, so the exchange had to use a crossing system to minimize the number of orders that didn’t get filled.  It was this crossing system that failed. "When Nasdaq tried to do the cross in the morning, the influx of orders that they received was so strong that they weren’t able to do the cross.  They had an emergency team come in and try to figure out how they would handle this." According to Repetto, Nasdaq was receiving orders on the server originally intended for the IPO, but new orders coming in at 11:10 were sent to a second server.  It wasn’t until 11:30 that the exchange got things straightened out and Facebook started trading.  Nasdaq printed the cross at $42 per share, but the stock soon fell rapidly. Meanwhile, traders became frustrated when order confirmations failed to go out. Repetto said some traders went almost 2-1/2 hours before getting confirmations.  Markets were shaken, and Facebook’s stock underwent a steep decline.  After a week, its shares were trading at less than $30. Facebook isn’t the only stock to have recent IPO problems - BATS tried to go public on 3/23 but, there too, a technical glitch caused it to yank its own IPO. Chris Isaacson, BATS: Chief Operating Officer. Being both the issuer and the exchange, BATS had the flexibility to halt the IPO.  No investors were harmed in that situation, which unfortunately was not the case with Facebook. Bryan Harkins, Direct Edge: Chief Operating Officer. Suggested the industry might need a hotline between all of the exchanges and regulators in order to deal with watershed events.  Harkins said companies and exchanges might receive a public relations beating for backing off from an IPO, but the overall blow to confidence from a messy offering could be even worse. NYSE’s Mr. Mecane said the Facebook disaster has had an effect on overall volumes, and on retail volumes in particular.  That seems to be backed up by an IPO survey put out by Tabb Group this month, which found the impact on investor confidence from that IPO is almost as great as the blow suffered from the Flash Crash of May 6, 2010. Nearly 60% of market participants surveyed by Tabb said they will be more cautious about participating in the next headline IPO. To access referenced story, go to:  [Traders Magazine, 6/22/12].