Google's Eric Schmidt offers fix for Fed leak

$600 million market mystery

CNBC's Eamon Javers reports the Federal Reserve is contacting news organization to discuss embargo rules after word the Fed's no taper decision last week might have reached some Chicago traders milliseconds before it should have.

As Javers explained, trading reaction should have begun in New York several milliseconds before it began in Chicago simply because of the time it takes the information to travel electronically.

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Eric Schmidt
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To Google Executive Chairman Eric Schmidt, though, there is a pretty simple solution here—just release the same information at the same time from several different parts of the country.

"You can't have a market where everybody's operating on the same information if it's not released at exactly the same time," Schmidt told "Closing Bell."

"It seems to be unfair to the traders who are not in New York that we're debating something over a couple thousandths of a second, in terms of fast trading. It seems to me that you should synchronize the clocks in San Francisco and Chicago and then you release simultaneously, so nobody's got an advantage. Seems like the notion of having a single place is an outdated idea."

Schmidt said the technology is there to make the simultaneous release of information happen, but a policy change is needed to make it happen.

—By CNBC's Drew Sandholm with Reuters. Follow him on Twitter @DrewSandholm