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Device Protects Day Traders From Emotional Trading
Philips Electronics, a Netherlands-based company, has come up with a device designed to protect day traders from emotionally based trading decisions. The Rationalizer measures your galvanic skin response and lets you know when you are under stress. An online trader can then take a "time-out, wind down and re-consider their actions," according to the company. This may have come too late for us, but at least future generations won't have to live through the horror of angry day trading.
Dunno why they'd have to invent something to do this: it's been known for almost 200 years. Build a Wheatstone Bridge with your body as one of the four legs of the bridge, and measure across the middle. I was building these when I was 10. Add a transistor to drive a meter and you have most of a Scientologist's E-meter. Use this as the input to an analog input channel of an Arduino and interface it via RS232 or USB to your computer and you can easily write something to automatically log you out of e-trade or whatever. I'm not really sure where the innovation is here, although Philips usually comes up with great ideas. I guess you could use a sparkfun xbee unit to make it wireless, since anything that contains the word "wireless" seems to be patentable these days, but that just makes me even more irritated.
Nostalgia's not what it used to be.
Day trading seems more like gambling than responsible ownership. Doesn't it create an unacceptable moral hazard?
I don't think you understand what a moral hazard is. Moral hazard refers to the concept that people who are isolated from risk (i.e: mega-corps that get bailed out when they fuck up) won't behave as rationally as those that are fully exposed to said risk. I don't recall many (any?) day traders getting bailed out during our recent round of corporate welfare.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
Google "liquidity" and you'll realize why having it is such an important thing. (and why gambling day traders provide it)
Day traders create and provide liquidity.
Read, refresh, repeat.
In fancy speak, they provide liquidity. Having said that, so do lots of other people & institutions.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Stock trading is meaningless for day to day operations of a company?
Actually yes, it mostly is, unless (as I said) that company is seeking to raise more capital. The stock price has no direct bearing on how much cash the company has in it's bank accounts. It has no direct bearing on whether or not their products will succeed in the marketplace. It has no direct bearing on whether or not a tornado will level their factory.
Being useful certainly isn't required. But being useless shouldn't be respected, should it?
Please explain to me why day traders are "useless". As I said in another post, if nothing else they provide needed liquidity in the marketplace.
How many people can't retire now, because the value of their 401k has dropped?
That's their own damn fault for having so much of their nest egg in volatile investments so close to retirement. For every story you can came up with of someone who can't retire I can counter with a story of someone in his 20s, 30s or 40s who is making a killing. I'm currently up 65% on the investments that I made as the market was tanking. My 403(b) is still down, but why would I care about that? I'm not going to retire for 40 years.
Are you saying day trading can not affect the value of people's 401k?
Day traders and short sellers can't drive down the price of a healthy company over the medium to long term. In the short term they can have an affect but nobody (who is sane) is holding stock investments in a 401(k) for the "short" term, are they?
It sounds as though you are claiming that all this hair trigger, instant trading has no effect outside of the parties involved, no externalities that affect individuals retirement or other accounts, or even entire economies
No, I've claimed nothing of the sort. I've only claimed that day traders can't "kill" an otherwise healthy company. I'm still waiting for you to produce some evidence to the contrary. Am I waiting in vain?
And yet, we've all seen lots of articles regarding automated day trading, and how it does exactly that.
Automated trading does some stupid shit. I recall the price of an airline being driven down to almost nothing over automated trading when a false report of their bankruptcy was published. I don't think it happened that long ago either. Would it surprise you to learn that even though the airline's stock dropped 99.92% that they remained in business? This would seem to run counter to your notion that traders can "kill" an otherwise healthy company.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.