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Goldman Sachs Trading Source Code In the Wild?
Hangtime writes "The world's most valuable source code could be in the wild. According to a report by Reuters, a Russian immigrant and former Goldman Sachs developer named Sergey Aleynikov was picked up at Newark Airport on July 4th by the FBI on charges of industrial espionage. According to the complaint, Sergey, prior to his early June exit from Goldman, copied, encrypted and uploaded source code inferred to be the code used by Goldman Sachs to process in real-time (micro-seconds) trades between multiple equity and commodity platforms. While trying to cover his tracks, the system backed up a series of bash commands so he was unable to erase his history, which would later give him away to Goldman and the authorities. So the question is: where are the 32MB of encrypted files that Sergey uploaded to a German server?
It's funny... I normally find myself loathing companies like Goldman Sachs for hyper-selfish capitalism, finding ways to get rich at taxpayer expense, etc.
But then, when I see industrial espionage by Russians, Chinese, Israelis, etc. against those very same corporations, a sense of nationalist anger makes me forget my anti-corporatist anger. Somehow I completely fail to have a sense of schadenfreude for the corporations that I normally hate, and I don't know why.
Being human is strange.
Exactly. Analyzing the source code will tell you how Goldman Sachs trades its stuff. It's not valuable because it was so expensive to develop this stuff, it's expensive because it shows how they play the game with what kind of strategy, and the stakes of the game is extremely high. It's like knowing how your opponent plays poker when the stakes are on the magnitude of billions of dollars.
If the source code is in the wild, Goldman Sachs is forced to stop all related real-time trades, because their strategy is completely exposed, and once somebody exploits it, they will lose money really quickly. (Just imagine how many transactions they can make per second, and imagine every one of those transactions lose some money in average.) That means they get forced to leave the market until they develop a new trading system, or at least, re-develop their strategy. That costs a lot of money because they have to stop doing investments and leave the money some place safe.
If I were a rival to Goldman Sachs I would be terrified of someone offering me Goldman's source code. If I use it and Goldman find out then I'm in a world of trouble. If I use it but Goldman don't know for a bit AND the person who offered it knows I used it, then they can blackmail me. Even if I don't use it there could be expensive legal battles to prove my innocence ("Exhibit A shows the same loop variable counter is used in these two different source code bases." "?!"). How do I know it's not a trap? It would be like someone offering the secret of Coke to Pepsi - what do you expect Pepsi to do? Use the secret? What if they like their product more?
Obviously there must be another angle if this situation is true to drive someone to actually do it. I just can't figure it out at the moment.
The fact that one can compare the strategy in big business with poker shows clearly why I think we're all better off when this whole banking business is downscaled a bit.
While in the good old days the banking business was simply a place to store and borrow money, it has now become a mess so complicated that nobody really understands it anymore.
It can be interesting to see what happens next... although I also realize that this accident can cause some innocent people to lose their jobs.
"The rolling stone article is conspiracy drivel..."
Thoughts:
1) The linked article is not the article published on paper in Rolling Stone, although confusingly it has the same name.
2) A Slashdot comment is not meant to be a complete discussion of anything. A Slashdot comment can alert you to the need to do further research.
3) The actual Rolling Stone article in the paper edition only says things that have been reported elsewhere.
4) The bankers certainly knew there would be a crash, and that they would profit from the crash, and that the crash would be very destructive to everyone else.
5) Matt Taibbi's article, The 52 Funniest Things About The Upcoming Death of The Pope lacks any humor. It's just stupid. In number 26, he guesses that the pope lives, and he dies. The point of the article seems to be that the pope gets less respect now; a big difference from 50 years ago. But it's a terrible article.
6) What is important is not what someone said, but the facts.