The top HFT firms are actually buying server racks inside of the stock exchange building, with the racks closest to the transaction servers being the most expensive.
It's amazing how many people in this thread have made up their own version of facts and baldly stated them as true.
In reality, the exchanges are careful to make sure all cable runs are the same length (within the building). Once in a while, they will offer a new, faster "tier" of service such as 10GB links which of course is quickly adopted by many firms.
(Now, of course, you have to wonder whether or not I just made that up.)
The people that "make it" in the industry (and while I know this is true in music, it's probably true in film and other arts as well) aren't necessarily very good at their given craft anyway. Most of the time, it's just a matter of being in the right place at the right time. Conversely, I've met some of the most ridiculously talented musicians busking for spare change
I totally agree. Consider, thisguy, who won a MacArthur "Genius" grant, is the undisputed leading modern scholar and performer of ragtime music, and yet still cannot afford his own grand piano.
no artists, except those at the absolute top of the heap, are making a living selling their music anymore.
We bought our house from, and are friends with, a couple who are both symphonic musicians - she with the LA Phil and he with Long Beach. AFAIK they don't have other jobs, yet they are doing fairly well.
I am personal friends with a few musicians from the Chicago Symphony Orchestra. They are not wealthy, but doing fine...enough for a modest townhouse, a car, and some neat bicycles. Of course, getting any full-time job playing for an orchestra is pretty top-of-the-heap considering how many classical musicians graduate each year from even just the top 3 programs (Eastman, Oberlin, Julliard).
More commonly, one finds classical musicians who are part-time with an orchestra, and have other jobs. I think that's true of several of the musicians in the Chicago Philharmonic for example.
In classical music, more than pop, performance is where the money is. If your orchestra records Beethoven's 9th, you're competing with hundreds of previous recordings, some of them amazing, while splitting the proceeds among a hundred people.
Ironically, classical music may be leading pop in this sense.
Here's an idea (and it's just that, an idea): Go completely, 100% independent.
I think Lowery's response would be that in such a case, one would mostly find the extra revenue going to what he terms the First Leg of the "new boss" (File sharing/Cyber Lockers).
Lowery's analysis seems cogent to me, and I am pessimistic about the world of digital distribution to match previous decades' spikes in artist revenue. I agree instead with the numerous posters above, who argue that the future profitability for musicians will be determined by having fewer musicians and more live revenue.
Music critics will also have to do a much better job.
My files were secure from other users of the machine
The way I see it, the technical difficulties -- both manifest and potential -- of protecting users from each other on the same OSX system made FileVault 1 untenable. Every app (written by Apple or not) that put data into unprotected memory, swap, or disk was in principle leaking confidential information from the vault. You may have felt like your files were safe, and if you never turned on remote login or allowed fast user switching you were probably right, but the general multiuser case is full of attack vectors.
So while in principle the per-user protection was nice, in practice it inevitably full of holes. Rather than provide the illusion of inter-user security, Apple switched to full disk encryption in FileVault 2 -- something closer to what most of its users really needed anyway.
contracts related to the price of the stock in the future all have to have prices rationally related to each other
To expand somewhat on your point:
The entire framework works extremely well (with certain modifications such as using volatility surfaces) for highly liquid markets with clear contracts and negligible jump risk, such as index futures and options. That success led to other markets "stretching" the model and its conceptual brethren to contracts where it worked successively worse, culminating perhaps in the silliness of options on tranche protection in CDO^2.
the market's assessments of the ("risk-adjusted") probability of future events is the best and most rational basis
I would also like to distinguish between risk models, which were always supposed to use real-world probability measures, and pricing models using risk-neutral measure. The mathematics explicitly distinguishes them, while the practice (as you note) often did not. But even when real-world probabilities were used, things went wrong when the parameters were fitted to historical experience. The prime example most telling example of that was risk models for packaged mortgages, calibrated to a historical period in which real estate prices had never declined.
Charlie and I are of one mind in how we feel about derivatives and the trading activities that go with them: We view them as time bombs, both for the parties that deal in them and the economic system."
Ah, yes. That would be the same Warren Buffet who traded over $37 billion of those very same derivatives (p.19) just prior to the 2008 crisis, in addition to selling even more esoteric tax-free bond insurance contracts.
No one can say the fraud was unknown, or that the present severe economic problems are due to a faulty mathematical formula.
I agree with you that the formula is not to blame. I don't think one should (implicitly or explicitly) assume there was much in the way of fraud -- that way lies conspiracy kookiness. Derivatives simply helped exacerbate a real estate bubble. Do you recall the endless conversations with all sort of ordinary people about the brilliance of their real estate investments? I sure do.
Yes, for the 1x1 case what you state is true...when both versions of the operator can be computed and the developer chose the wrong one since it will silently produce an unintended result...Since MATLAB was designed as a platform for matrix computation they choose for * to specify matrix multiplication.
Good explanation. To amplify this point with respect to Julia, if the Julia developers really intend it to be merely a matrix computation platform then they chose the right syntax.
Based on the linked materials, though, it seems they are really aiming for the general numerical computing crowd. If so, their choice of syntax is a grave mistake. Matlab may be stuck with it for historical reasons, but I have no desire to go back to finding bugs whose presence is inferred by noticing a single pixel on my monitor or, worse, the lack of it.
This may seem petty, but one of the biggest sources of relief to me in changing from Matlab to R and Numpy was finally leaving behind that damned operator syntax where element-wise operations need to have an extra dot prepended. That is to say, if I have an array t of times and an array x of distances, I want to be able to get the corresponding array of speeds using x / t. In Matlab and Julia I must instead use x./ t.
It seems like no big deal, but it is unbelievable how many Matlab bugs I wrote due to that little difference. True linear algebraic operations are so rare, at least to me, that I am far happier giving them the special operators and reserving the usual operators to work element-wise.
I also must have named arguments and default values. It's a pity, because otherwise it looks to have decent syntax, good speed and nice parallelization. For now, I'm sticking with R, numpy and C.
When we built out our rec room two years ago, I paid to have the electricians fit it out with "dimmable" LED lighting. Overall, I am happy with the light temperature and eventual cost savings (the incremental cost was many hundreds of dollars for about 10 fixtures).
I am not impressed at all with the level of dimmability these lights can achieve. Their perceived light output can be cut by half, or maybe 2/3. That's probably about a factor of 10 or so in terms of light energy output, but it's nowhere near what I am looking for when I want to soften the room's appearance.
We're getting some ceiling lights put in a couple other rooms tomorrow, so on Monday I asked the electrician ( *very* competent guy) to show me the latest and greatest in dimmable LEDs. There's been essentially no improvement; they are still only nominally dimmable. So I asked him to install incandescents.
I sold my old Apple ][ just two months ago on eBay. It went to a fellow in Colorado who needed to do some kind of data work. I was happy to see it wasn't gong for parts, at least not yet.
I've been using MythTV for a couple of years on Mac Mini (running OSX rather than Linux), talking to an HDHomeRun network tuner connected to a broadcast antenna in my attic. The team has really improved the OSX port in the last few years, with the only lack of Linux parity being in the realm of hardware-accelerated playback.
After dealing with the confusing setup screens and active channel scans, it has worked brilliantly, especially since the 0.24 release. The scheduling software is really good, especially using the web frontend. Watching TV on any computer in the house has been very convenient, and the automatic commercial skipping is pleasant.
Between broadcast and online sources, I get most of what I want to watch, the exceptions being Game of Thrones and some cable-only basketball and hockey broadcasts. The complete, uncompressed HD signals over broadcast TV are perceptibly clearer than HD cable (or, worse, HD satellite) signals, which suffer from the compression.
I had dinner last week with my brother-in-law (who repairs hands, e.g. by replacing a patient's mangled fingers with some of their toes) and one of his mentors, who happens to have done one of the successful face transplants.
When guys like these ask if you want to see the pictures on their cellphones, it is best to refuse. Trust me on this.
I am totally with you on this. I don't lead an "interesting" life in any way, but work and non-work are best separated in my opinion. LinkedIn is best for work contacts. Once I leave, the people I liked can become social friends (both on networks and in the flesh).
Oil will increase in price for a few years yet and remain available, but long before the wells are dry it will become useless. This will happen quite suddenly, in a few years.
I'm not so sure it will happen "suddenly" because there is a wide variety of oilfield types out there. I am hopeful that, if the supply decrease and price increase are sufficiently slow, there will be time for the energy economy to transition to other sources (gas/solar/fusion/magic).
The lack of major improvement in AppleTV features makes me think perhaps something else is coming. Recall how Steve Jobs was saying he had finally cracked integrated television? It is hard to believe he would make that statement with respect to what is currently on offer from Apple.
It is probably not a violation of the TOS for a job candidate to allow someone to look over his or her shoulder while logging in and surfing. However your point about Equal Opportunity Employment is very interesting.
One doesn't get to pay long-term capital gains rates on dividends, so the appropriate figure to use is the marginal rate. As an Apple shareholder, for me, that is over 30%.
Only if you flip your shares within 30 days of the dividend. If you hold for more than a 30 day window surrounding the div, it will almost certainly be "qualified" for th 15% rate cap. This is why Romney's effective tax rate is 15%: both cap gains and most dividends are taxed at 15%. When a company makes a major, one-time dividend, investors may even end up with capital losses on the share price to offset the dividend.
We were both wrong. I thought dividends were already taxed as ordinary income but that does not start until next year. There is presently a holding window, as you thought, but it's more complicated than the 30 day rule.
One doesn't get to pay long-term capital gains rates on dividends, so the appropriate figure to use is the marginal rate. As an Apple shareholder, for me, that is over 30%. The grandparent poster's 80% seems way to high, especially because not all those accumulated profits are overseas. Nevertheless between repatriation taxes on at least some of the cash and income tax of stockholders I would not be surprised if the government took about 40% of the money.
In addition, a dividend forces all the shareholders to take the income on the payment date, rather than at a more convenient time. Consultants, actors, retirees and other people with unsteady income do much better if they can "smooth" it out to avoid being in high tax brackets during the fat years with insignificant relief in the lean ones. Not to mention the ability to offset gains and losses (for those of us who still have capital losses from the 2001 dot com crash (!)).
In contrast to dividends a stock buyback allows the shareholder to get the long-term capital gains rate or perform offsets, and gives more flexibility about when the income comes in.
I think you are quite right that they are thinking hard about this cash ratio and how to glide to the right level. There is no obvious right answer so I like the fact that they are being cautious about it all.
When some big, traditional (institutional?) investor fooled by this artificially high volume decides to sell 100000 shares, it will impact market much higher than if that 250000 (or even half of that) was a real volume.
On the other hand, the small-time investor like you or me trading 500 shares enjoys a better price due to the reduced bid-ask spreads. Anyone trading 100,000 shares darn well ought to be savvy enough not try try to do them all in one big lump. Even if you are correct about phantom liquidity being problematic, you are effectively arguing that the big institutional investors (e.g. hedge funds) are more deserving of a break than the small-time guys.
Zerohedge is fascinating but they are nut jobs, full of doomsaying prophecies, hyperbole and conspiracy theories. It's well worth spending some time reading the site, especially the reader comments which are even more entertaining than the stories.
Slashdot Mirror
The top HFT firms are actually buying server racks inside of the stock exchange building, with the racks closest to the transaction servers being the most expensive.
It's amazing how many people in this thread have made up their own version of facts and baldly stated them as true.
In reality, the exchanges are careful to make sure all cable runs are the same length (within the building). Once in a while, they will offer a new, faster "tier" of service such as 10GB links which of course is quickly adopted by many firms.
(Now, of course, you have to wonder whether or not I just made that up.)
OK, I'll bite on the recording, but which one? 2008 or early 1990s?
The people that "make it" in the industry (and while I know this is true in music, it's probably true in film and other arts as well) aren't necessarily very good at their given craft anyway. Most of the time, it's just a matter of being in the right place at the right time. Conversely, I've met some of the most ridiculously talented musicians busking for spare change
I totally agree. Consider, this guy, who won a MacArthur "Genius" grant, is the undisputed leading modern scholar and performer of ragtime music, and yet still cannot afford his own grand piano.
Success was never really about talent, was it?
no artists, except those at the absolute top of the heap, are making a living selling their music anymore.
We bought our house from, and are friends with, a couple who are both symphonic musicians - she with the LA Phil and he with Long Beach. AFAIK they don't have other jobs, yet they are doing fairly well.
I am personal friends with a few musicians from the Chicago Symphony Orchestra. They are not wealthy, but doing fine...enough for a modest townhouse, a car, and some neat bicycles. Of course, getting any full-time job playing for an orchestra is pretty top-of-the-heap considering how many classical musicians graduate each year from even just the top 3 programs (Eastman, Oberlin, Julliard).
More commonly, one finds classical musicians who are part-time with an orchestra, and have other jobs. I think that's true of several of the musicians in the Chicago Philharmonic for example.
In classical music, more than pop, performance is where the money is. If your orchestra records Beethoven's 9th, you're competing with hundreds of previous recordings, some of them amazing, while splitting the proceeds among a hundred people.
Ironically, classical music may be leading pop in this sense.
Here's an idea (and it's just that, an idea): Go completely, 100% independent.
I think Lowery's response would be that in such a case, one would mostly find the extra revenue going to what he terms the First Leg of the "new boss" (File sharing/Cyber Lockers).
Lowery's analysis seems cogent to me, and I am pessimistic about the world of digital distribution to match previous decades' spikes in artist revenue. I agree instead with the numerous posters above, who argue that the future profitability for musicians will be determined by having fewer musicians and more live revenue.
Music critics will also have to do a much better job.
A very important point!
My files were secure from other users of the machine
The way I see it, the technical difficulties -- both manifest and potential -- of protecting users from each other on the same OSX system made FileVault 1 untenable. Every app (written by Apple or not) that put data into unprotected memory, swap, or disk was in principle leaking confidential information from the vault. You may have felt like your files were safe, and if you never turned on remote login or allowed fast user switching you were probably right, but the general multiuser case is full of attack vectors.
So while in principle the per-user protection was nice, in practice it inevitably full of holes. Rather than provide the illusion of inter-user security, Apple switched to full disk encryption in FileVault 2 -- something closer to what most of its users really needed anyway.
contracts related to the price of the stock in the future all have to have prices rationally related to each other
To expand somewhat on your point:
The entire framework works extremely well (with certain modifications such as using volatility surfaces) for highly liquid markets with clear contracts and negligible jump risk, such as index futures and options. That success led to other markets "stretching" the model and its conceptual brethren to contracts where it worked successively worse, culminating perhaps in the silliness of options on tranche protection in CDO^2.
the market's assessments of the ("risk-adjusted") probability of future events is the best and most rational basis
I would also like to distinguish between risk models, which were always supposed to use real-world probability measures, and pricing models using risk-neutral measure. The mathematics explicitly distinguishes them, while the practice (as you note) often did not. But even when real-world probabilities were used, things went wrong when the parameters were fitted to historical experience. The prime example most telling example of that was risk models for packaged mortgages, calibrated to a historical period in which real estate prices had never declined.
Charlie and I are of one mind in how we feel about derivatives and the trading activities that go with them: We view them as time bombs, both for the parties that deal in them and the economic system."
Ah, yes. That would be the same Warren Buffet who traded over $37 billion of those very same derivatives (p.19) just prior to the 2008 crisis, in addition to selling even more esoteric tax-free bond insurance contracts.
No one can say the fraud was unknown, or that the present severe economic problems are due to a faulty mathematical formula.
I agree with you that the formula is not to blame. I don't think one should (implicitly or explicitly) assume there was much in the way of fraud -- that way lies conspiracy kookiness. Derivatives simply helped exacerbate a real estate bubble. Do you recall the endless conversations with all sort of ordinary people about the brilliance of their real estate investments? I sure do.
Yes, for the 1x1 case what you state is true ...when both versions of the operator can be computed and the developer chose the wrong one since it will silently produce an unintended result...Since MATLAB was designed as a platform for matrix computation they choose for * to specify matrix multiplication.
Good explanation. To amplify this point with respect to Julia, if the Julia developers really intend it to be merely a matrix computation platform then they chose the right syntax.
Based on the linked materials, though, it seems they are really aiming for the general numerical computing crowd. If so, their choice of syntax is a grave mistake. Matlab may be stuck with it for historical reasons, but I have no desire to go back to finding bugs whose presence is inferred by noticing a single pixel on my monitor or, worse, the lack of it.
This may seem petty, but one of the biggest sources of relief to me in changing from Matlab to R and Numpy was finally leaving behind that damned operator syntax where element-wise operations need to have an extra dot prepended. That is to say, if I have an array t of times and an array x of distances, I want to be able to get the corresponding array of speeds using x / t. In Matlab and Julia I must instead use x ./ t.
It seems like no big deal, but it is unbelievable how many Matlab bugs I wrote due to that little difference. True linear algebraic operations are so rare, at least to me, that I am far happier giving them the special operators and reserving the usual operators to work element-wise.
I also must have named arguments and default values. It's a pity, because otherwise it looks to have decent syntax, good speed and nice parallelization. For now, I'm sticking with R, numpy and C.
When we built out our rec room two years ago, I paid to have the electricians fit it out with "dimmable" LED lighting. Overall, I am happy with the light temperature and eventual cost savings (the incremental cost was many hundreds of dollars for about 10 fixtures).
I am not impressed at all with the level of dimmability these lights can achieve. Their perceived light output can be cut by half, or maybe 2/3. That's probably about a factor of 10 or so in terms of light energy output, but it's nowhere near what I am looking for when I want to soften the room's appearance.
We're getting some ceiling lights put in a couple other rooms tomorrow, so on Monday I asked the electrician ( *very* competent guy) to show me the latest and greatest in dimmable LEDs. There's been essentially no improvement; they are still only nominally dimmable. So I asked him to install incandescents.
I sold my old Apple ][ just two months ago on eBay. It went to a fellow in Colorado who needed to do some kind of data work. I was happy to see it wasn't gong for parts, at least not yet.
1080i or 1080p will not necessarily look better than 720p. It depends how severely it has been compressed.
I can't believe I wrote "uncompressed" . You're right, of course.
I've been using MythTV for a couple of years on Mac Mini (running OSX rather than Linux), talking to an HDHomeRun network tuner connected to a broadcast antenna in my attic. The team has really improved the OSX port in the last few years, with the only lack of Linux parity being in the realm of hardware-accelerated playback.
After dealing with the confusing setup screens and active channel scans, it has worked brilliantly, especially since the 0.24 release. The scheduling software is really good, especially using the web frontend. Watching TV on any computer in the house has been very convenient, and the automatic commercial skipping is pleasant.
Between broadcast and online sources, I get most of what I want to watch, the exceptions being Game of Thrones and some cable-only basketball and hockey broadcasts. The complete, uncompressed HD signals over broadcast TV are perceptibly clearer than HD cable (or, worse, HD satellite) signals, which suffer from the compression.
I had dinner last week with my brother-in-law (who repairs hands, e.g. by replacing a patient's mangled fingers with some of their toes) and one of his mentors, who happens to have done one of the successful face transplants. When guys like these ask if you want to see the pictures on their cellphones, it is best to refuse. Trust me on this.
I am totally with you on this. I don't lead an "interesting" life in any way, but work and non-work are best separated in my opinion. LinkedIn is best for work contacts. Once I leave, the people I liked can become social friends (both on networks and in the flesh).
Oil will increase in price for a few years yet and remain available, but long before the wells are dry it will become useless. This will happen quite suddenly, in a few years.
I'm not so sure it will happen "suddenly" because there is a wide variety of oilfield types out there. I am hopeful that, if the supply decrease and price increase are sufficiently slow, there will be time for the energy economy to transition to other sources (gas/solar/fusion/magic).
Mod parent up: a Slashdot poster who understand economics of futures!
The lack of major improvement in AppleTV features makes me think perhaps something else is coming. Recall how Steve Jobs was saying he had finally cracked integrated television? It is hard to believe he would make that statement with respect to what is currently on offer from Apple.
You should remind them that accessing another user's account is a violation of facebook's terms of service, ... i.e. a felony....
In addition, there are various other questions that employers cannot ask during interviews because doing so violates federal equal employment opportunity legislation
It is probably not a violation of the TOS for a job candidate to allow someone to look over his or her shoulder while logging in and surfing. However your point about Equal Opportunity Employment is very interesting.
One doesn't get to pay long-term capital gains rates on dividends, so the appropriate figure to use is the marginal rate. As an Apple shareholder, for me, that is over 30%.
Only if you flip your shares within 30 days of the dividend. If you hold for more than a 30 day window surrounding the div, it will almost certainly be "qualified" for th 15% rate cap. This is why Romney's effective tax rate is 15%: both cap gains and most dividends are taxed at 15%. When a company makes a major, one-time dividend, investors may even end up with capital losses on the share price to offset the dividend.
We were both wrong. I thought dividends were already taxed as ordinary income but that does not start until next year. There is presently a holding window, as you thought, but it's more complicated than the 30 day rule.
One doesn't get to pay long-term capital gains rates on dividends, so the appropriate figure to use is the marginal rate. As an Apple shareholder, for me, that is over 30%. The grandparent poster's 80% seems way to high, especially because not all those accumulated profits are overseas. Nevertheless between repatriation taxes on at least some of the cash and income tax of stockholders I would not be surprised if the government took about 40% of the money.
In addition, a dividend forces all the shareholders to take the income on the payment date, rather than at a more convenient time. Consultants, actors, retirees and other people with unsteady income do much better if they can "smooth" it out to avoid being in high tax brackets during the fat years with insignificant relief in the lean ones. Not to mention the ability to offset gains and losses (for those of us who still have capital losses from the 2001 dot com crash (!)).
In contrast to dividends a stock buyback allows the shareholder to get the long-term capital gains rate or perform offsets, and gives more flexibility about when the income comes in.
I think you are quite right that they are thinking hard about this cash ratio and how to glide to the right level. There is no obvious right answer so I like the fact that they are being cautious about it all.
When some big, traditional (institutional?) investor fooled by this artificially high volume decides to sell 100000 shares, it will impact market much higher than if that 250000 (or even half of that) was a real volume.
On the other hand, the small-time investor like you or me trading 500 shares enjoys a better price due to the reduced bid-ask spreads. Anyone trading 100,000 shares darn well ought to be savvy enough not try try to do them all in one big lump. Even if you are correct about phantom liquidity being problematic, you are effectively arguing that the big institutional investors (e.g. hedge funds) are more deserving of a break than the small-time guys.
Zerohedge is fascinating but they are nut jobs, full of doomsaying prophecies, hyperbole and conspiracy theories. It's well worth spending some time reading the site, especially the reader comments which are even more entertaining than the stories.