I can remember when a good trading day was 10 million shares for the whole NYSE. Now we are approaching 10 BILLION shares/day…and some of the highly traded stocks are unbelievably huge. take INTEL (one of my favorites)-yesterday, they traded over 73 million shares! Why the huge volume? Given that about 70% of INTEL is held by institutions, why is the daily turnover so huge? And, given the relative stability of INTEL, are there a l;ot of option writers, short-sellers, or outright “churners” attempting to manipulate the price of this stock?
Great time to be a stockbroker-the daily commisions for INTEL trasers must be enormous! 
It’s not so much that they’re trying to “manipulate” prices as trying to take advantage of the prices that already exist. The ease of program trading allows hedging and arbitrage strategies that involve microscopic profit on huge trading volume. You can buy stock on one exchange and sell it on another, buy stock and sell options, buy options and sell stock, buy the stock just in time to become the shareholder of record for the dividend and sell it immediately afterward, and on and on. This drives most of the increase in trading volume.
Two Reasons
- Day trading has increased in popularity
- The internet
That’s sort of a catch 22.
Don’t forget as well stock splits are very common, which increase the volume, because smaller investors are allowed to get in on it.
The main reason for the rise is the drastic lowering of commissions that happened with the rise of internet trading. It used to cost a few hundred dollars and you had to trade in large blocks. I now see advertisements of $8 trades. The 8 bucks is mostly independent of the number of shares being traded. Without the low commissions day trading is pretty much impossible as the commission’s would eat all the profits.
Stock splits have been common since stocks began trading. They were being used continually in the 19th century. Nothing new there to explain the increased volume.
Day trading volume has dropped preciptiously since the heyday of the Internet boom. Few people can successfully daytrade in a non-rising market.
And Catch 22 means something entirely different than your usage.
The use of computerized trading, the growth of huge funds that need to show large percentage increases, and the drop in cost of commissions are the major factors, IMO.