So the moment that a company makes money from their highly paid economist they change from having no unfair advantage to having an unfair advantage. At the same time, if HFTs stop being profitable it is no longer unfair.
I doubt any company is going to have an advantage by employing any economist. I really highly doubt that - at least so far as the stock market is concerned.
I, you, or anyone else can learn everything that exists in economics, and we can then use our knowledge to analyse and make predictions on the future - in the same way any economist employed by any company can. There is absolutely no inherent advantage which they have over anyone.
On the other hand I cannot fathom what apart from HFTing can possibly give one such a great advantage. No matter how smart you are, you can not do what they do because you do not have such low latency access to the ASX.
And just like you might argue that the top economists hired by the top companies may have more experience and skill than me or you or others, you can say that the top HFTing companies may have smarter algorithms than you or I or others may develop - but that is irrelevant to the point of being able to have the same opportunity to try and make a profit in the same way.
When does existence imply profitability?
When that which exists makes profit and thereby continues existing and perhaps even expanding. HFTing companies would not pay the highest salaries and employ ever more people if they were not extremely profitable.
Look - I am neither a supporter or detractor of HFTs. I see their existence as having both pros and cons. I am happy to change my mind if there's new information suggesting to me that they have unfair advantage. But so far none of your argument hold up logically (let alone factually).
Maybe that's just because you're not looking at it from the broader perspective. Imagine that you could create HFTing algorithms just like them, which could make money - and yet, you could not deploy them because of a lack of capital. Now you see all these companies making money doing exactly the same as what you can do - but you do not have this opportunity, simply because you don't have enough money. Would you still think that's fair?
Is our economic system not meant to be based on the concept of equal opportunity? Just like it's unfair (and illegal) to trade based on knowing insider information before others, isn't it unfair to trade based on knowing the market action before others?