The backup plan is you ask the ATC. Ask a pilot. Even "couple hours training" noob like myself knows that. Its considered extremely bad form to tell the ATC "I'm too Fing lazy to look up the approach plate, whats the ILS freq again?" but if you have an equipment breakdown they have procedures and policies in place for generations now to help you out.
As for plane docs, it doesn't really matter as long as the ipad is highly reliable. You use the same checklist over and over to make sure you don't forget anything... its 99.999% good without a checklist (literally) so once or twice is no big deal.
There is some truth that the ipad will probably be more up to date and less likely to have a page torn out or coffee dumped on it than paper. It'll likely be more reliable as a system, even if it doesn't degrade smoothly.
And if HFT gets trading companies more money, then that money has to come from somewhere and if it's not coming from other trading companies, then it must be coming from the investors.
There's a pretty good argument that HFTs screw retail investors out of sub-cent price increments both at purchase and sale, lets call it one cent total per share over the ownership of the share. So over the life of a purchase and sale of 100 shares of my electric company stock, which trades at about $40, I'm getting screwed out of $10 commission for purchase and sale, thats $20 subtotal, plus about one cent total times 100 shares equals a buck. So my total screw cost is $21 on a roughly $4000 transaction. Compared to almost any market, real estate, anything, thats pretty good.
Yes is sucks being screwed outta that dollar. If its any consolation my father traded back when commission charges were something like $75, or a total screw cost of $150. So be careful if you wish for the good ole days, because you just might find that you save $1 in HFT "losses" but lost $130 in higher commission fees.
Compared to say, corruption in real estate, I'm not sure HFT is worth worrying about.
I'm not sure I completely understand your position, but I'm pretty sure you just reinvented the market maker job/position and reinvented the limit order. google/wiki for them and see how similar your idea is. We've had those for a long, long time and it has no impact on HFT operation.
You say the quantization is arbitrary, I say that the allowed time scales are arbitrary
OK that's an interesting, although very unusual way to look at it. For generations, increasing transparency and making the market free-er has been a goal. If you wanna reverse that its going to be a hard slog, as long as you've got a good enough story maybe you can do it. "we hate the rich" hasn't worked very well so far, but maybe...
You say the market is being restricted in how it can evaluate values, I say the market is being allowed to make irrational evaluations.
OK you're confusing the market, which sets rules, and evaluations aka prices. Maybe a/. car analogy would help? The market, enforced by men with guns aka the govt, says thou shalt buy/sell cars solely in values of $1000 a piece. In other words, you may only price cars in increment of thousands. You can enforce trades only happen with 3 zeros at the end of the price, but you can't enforce thoughts in brains of sub-thousand dollar prices. So you and I in an unfree market can only buy/sell our cars at $1K, $2K for used or $20K, $21K new, etc. HOWEVER used car dealers are making trades of 10 1997 Saturn cars for... lets say $9K for 10 of them, because in the dealer's brain its only worth exactly $900 and they can't be forced at the brainstem level to not think about sub-thousand dollar pricing. Insert all kinds of complaining that retail car buyers can't purchase a $900 car therefore (wrongly) the dealers are ripping them off. The real source of the "ripoff" is the unfree market... if the market rules allowed retail investors to buy a 1997 Saturn for $900 then the car dealer "HFT" market would cease to exist.
I do think though that "the market" should be fairly unfettered, but it should always reflect the considered choices of human minds.
There ya go. The problem is one set of minds said we're gonna trade in cents and anyone trading smaller than cents goes to jail (literally), and another set of minds said we can calculate value more accurately than cents. Mush the two together along with sufficient capital and its almost a self organizing system how HFT automagically evolves. Or on another scale they said retail investors are only allowed to trade in cents but big firms can do fractional cents, because big firms will keep each other honest but big firms will always screw their customer when rounding fractional pennies or whatever justification. There is no one single correct human mind so all you need to do is get rid of diversity of opinion and it'll be no problemo.
The reason retail trading is dying is HFT has eroded people's confidence in the shell game Wall Street setup.
Yeah whatever. I don't think that enters into many 401K / IRA / corporate pension purchasing decisions. Especially not for the 14 million americans (or whatever the figure is) who no longer have jobs, or the folks who can't afford investment anymore, or the people who cashed it all in related to housing price collapse short sales, or whatever. YES I agree with you sentiment / animal spirits is strongly negative, no I disagree that other more practical reasons are the primary reason.
HFT does not result in higher liquidity.
I hope you worked on the IT side or something other than the economic side... hard to argue that executing "lots of orders all the time" somehow doesn't affect liquidity. That's kind of the definition of liquidity? Lots of orders laying around waiting for you to toss yours in so it clears rapidly... kinda like... the definition of HFTs...
It's just skimming with no intent on long term investment.
Yeah well thats a policy issue that has nothing to do with your previous statement. I'm not even sure there's a moral argument against it.
Everyone felt ticketmaster's service charge was out of whack. The same is true of HFT.
Please enlighten the world on how HFT causes increased charges. On a big scale thats a lot of investment and the trading firms are going to squeeze the blood outta the retail investors eventually... assuming that industry wide all players as a net make money off HFT, which they probably don't. On a small scale its zero sum, its trading corp A making 50 cents off trading corp B's loss of 50 cents.
Well of course the NYSE could not act alone, or would have to make sure the majority of traders wanted this.
No, not the majority of traders, thats not going to do it at all, you need the entirety of all markets to act. All of them. Simultaneously.
Its like those discussions "if only we never invented the nuclear bomb, how much better the world be if it never existed, if only magic could uninvent it" blah blah. Not terribly practical.
You don't gamble if you can have a working market that gives you a normal return of about 5-6%.
Right, because mgmt which currently demands a ridiculous rate of return above the market would do a 180 if returns were higher and maybe demand a lower return than the market or something. If the market returned 5% you'd just end up with some exec trying to get 10% implementing HFT. I'm not buying your scenario.
I don't want to 'ban' anything except gov't manipulation of money.
Right and a HFT bashing discussion is a good horse to hang on to in order to push another unrelated agenda. An agenda which I happen to agree with. But I don't think your tactic is helping "our" cause very much. HFT has about as much to do with the unfree banking markets as it does with astrology or numerology.
The internet is full of people who have strong opinions about things they have absolutely no knowledge of.
In the 80s it was
1) They use junk bonds which are bad because I say so and the logical reason why is 2).... 3) Profit !!!
In the 10s it seems to be
1) They use HFT which are bad because I say so and the logical reason why is 2).... 3) Profit !!!
Whenever you see someone talking solely about platitudes and cliches and never mention what a chemist would call the reaction mechanism explaining why whatever they're demonizing has any connection with an assortment of bad results, assume they're lying and/or starting a new religion.
There are lots of solutions here, the NYSE should select one.
That'll work well, because there's only one stock market in the whole world and no one has thought up the idea of pool trading/markets. Errr, um, more likely this would be an effective way to make the NYSE basically eliminate itself from the trading ecosystem...
i could invest in good ideas and ventures based on how much they would pay off in dividends, not inflated stock prices.
You might invest there, but few other people would. See its like an onion and no matter how deep you think you've dug there's a deeper layer. I REALLY don't want to invest in dividend stocks because I want to control when to pay income taxes on my investment's growth. I do own some electric company stock and some PHB at the powerco decides when and how much tax I should pay on their growth. I hate that. Which is probably why I have less than 5% of my investments in dividend yielding stocks. I would much rather pay long term cap gains when I'm retired at a nice low income so a nice low tax rate, rather than every year now at the peak of my income. Furthermore the power of compounding means at retirement I'll have more money to be taxed less, because I'm not getting taxed on dividends every quarter. Non-dividend yielding stocks are kinda the poor man's IRA, sorta, in that you don't pay taxes on them until you want to, probably when you retire.
My advice is if you don't know the rules don't pontificate on the philosophy of the game's rules. You accurately listed several things that suck. I agree with you on your list and your interpretation of your list. Unfortunately your list has very little to do with why HFT exists.
Of-course the actual solutions aren't even accepted on silly public forums, and they are definitely not going to be accepted by the politicians
The SEC is controlled by private firms that control politicians, not the other way around. If you really want to destroy HFT, for whatever reasons, the way to do it is to convince trading firms that if you want sub-penny price discovery, you could continue the buildout of your rather baroque and expensive HFT infrastructure, or you could just tell your elected pawns in the govt to tell the SEC to modify rule 612 to force rounding to the nearest dollar or the nearest millionth of a penny.
If you round to the nearest dollar no one will ever (famous last words) accumulate enough capital to HFT. If you round to the nearest millionth of a penny then millions of dollars of infrastructure will only bring in fractional millionths of a penny times perhaps millions of trades per day or about a thousand bucks a year. Which compared to buying federal bonds at roughly 0 percent or soon to be defaulting muni bonds at -100% is actually not that bad of a return on equity, but anyway...
Either way the only way for HFT to exist is to set the quantum interval for trading to be "about a penny" which... tada happens to be right exactly what its set to. I think the way the game's rules are set up precisely perfectly to maximize HFT profits does kinda indicate the people in charge of the market at the big firms want it to be that way, this is not some kind of weird coincidental engineering accident.
The only real long term effect of destroying HFT would likely be to heavily reduce the transfer of wealth from the FIRE sector to the telecom and IT sector. I'm not sure anyone outside the FIRE sector would benefit by that... I like having the FIRE sector crooks, in a small way, subsidize my IT and telecom service.
The NYT article sucked. Can't wait for print journalism to die. 1) Here's some authorities who are authorities because we say so, who are fighting like little middle school drama queens 2) Everyone loves a good "rich people suck and they're corrupt 3) Rabble rousing tired old cliche of "kids have no idea what they're doing vs old people are obsolete"
My pitiful TLDR summary of Stucchio's work combined with some other observations
1) Idiotic SEC rule 612 quantizes share price into small enough increments that you can raise the capital to HFT and increments that are large enough that you can make some serious dough doing HFT. HFT is not caused by Bolshevists in your bathroom or too many atheists or gobblin infestations, its caused by a stupid SEC rule that was created in a snap of the fingers and can go away just as quick.
2) Ask ANY EE or "real" telecom guy HFT is a real world application of dithering to improve resolution. Oh the "real" price of a share is 100.003 but we're only allowed to report price to a resolution such that its either of two quantum states 100.00 or 100.01. Simple system solution? Dump out 10 orders, 3 at 100.01 and 7 at 100.00 to meet some idiotic SEC rule. Now "everyone" knows the real free market price is signalled at 100.003 even if the unfree market is only allowed to trade at one cent increments.
3) Most of the whiners on both sides have a dog in the fight, if they are in the business and can't HFT for whatever reason they hate HFT and if they can they love it. Or they're just doing witchcraft style persecution where no logical mechanism is necessary... my sheep died therefore we should hang some old woman is no different than my dotcom bombed therefore we should punish a successful HFT trader "just because".
4) The ratio of HFT trading vs retail trading is absolutely exploding not entirely because HFT is growing (although it is...) but because retail trading is absolutely dying. Retail is dying for two reasons: Headed into next down leg of the second great depression (bubbles usually melt up in price and down in volume) and demographic stuff like looking at labor force participation graphs tens of millions of working age americans are no longer working, therefore there is no need to invest their 401K and IRA money from non-existent jobs. So yes HFT is growing but don't make the mistake of thinking the ratio of HFT to retail is in any way relevant, because retail is terminally ill and almost dead.
5) Some elderly/lazy people get all confused about frontrunning (which is illegal) because both frontrunners and HFTers are nuts crazy about low latency and fast execution. Therefore they obviously must be the same, at least to an idiot. This is about as intelligent as the anti-vaxers... "Getting hit in the head by a 2x4 causes stupidity... high levels of lead in the blood cause stupidity... therefore getting hit in the head by a 2x4 results in high blood levels of lead". Morons.
6) Some lazy people enter market orders instead of limit orders. Probably not a wise idea any time in the last 150 or so years, although it is an even worse idea when retail volume is melting down and HFT volume is melting up. You could ban market orders for retail investors, but stupid people are always going to find a way to lose money, so I'm not sure there's any point to it. There's an infinite pool of ways for morons to lose money so removing one isn't going to really change the outcome. Its not the end of the world in that any average long term retail investor trade has just about zero odds of being stuck in a "flash-anything" related HFT event.
Election organisers also pull tricks like that all the time, like deliberatly under-allocating polling locations to districts they know would tend to vote for the enemy so some of the voters give up upon seeing the queue running around an entire city block.
I have personally seen this old scam with my own eyes in the same city. The spanish-only school polling site next to the homeless shelter and near the college has greater than one hour lines (I was a student at that school), same city nearby the hospital where the rich doctors own houses right next door to the poor young renters like myself, aka roughly 50:50 voting results had reasonable short lines, same city solidly middle class subdivision nobody living there is much below 60K and much above 120K but they're almost all quislings (giant W poster/vinyl sign was on one guy's garage door for about 4 years), never seen a "D" yard sign, so needless to say we've got 3 times the number of poll workers and they are young enough (relatively) that they can actually hear people speak, so its walk in walk out voting no wait.
This is one of the very few ways its harder to corrupt internet voting... I donno how you make the average huffpo browser harder to vote than the average fundamentalist church voter... maybe you could release a "pre-voting mandatory virus scanner" that takes 10 times as long to scan if it sees evidence of visiting the "wrong" part of the internet as defined by the virus scanner author.
There's a million old scams... merely running them online is not very interesting.
I hate to reply to myself, and contradict myself, but I believe I just invented a new form of voter fraud in the last hour while thinking about this. Unlike all the other example I thought of, this is unique and new to the internet age and never existed before in identical format in meatspace.
Take witches cauldron. Mix in: 1) A decent rootkit to intercept and modify all traffic in and out of a box 2) Deep monitoring and tracking sufficient to categorize a PC as D or R owned (for example, tracking cookies from fundie church = R owner, installed "I love Obama" app on his itunes connected iphone = D owner) 3) All internet voting involves lots of bits of data to make a one bit vote
Simply write your malware to do nothing if monitoring/tracking indicates victim is in a demographic group on your side. If they're on the other side, flip their vote. So they clicked party "A" and their screen shows party "A" but the rootkit intercepted and sent party "B" and any attempt to review their vote online shows party "A" just as they suspect.
Now the lots of bits to vote a single bit choice means another interesting rootkit option is to simply intercept and pick a random vote selection... 50:50 odds (roughly) that you guess correctly, and if wrong the voter/victim assumes they mistyped, so they try again at which point your malware shows the flipped bit other guy as their voter....
This new form of fraud in internet voting can be combined with traditional fraud. For example outsource malware to India, that way you know it'll never work, with it designed to screw yourself over. Since it doesn't work, you won't be harmed, and you can release the evidence to the press to "prove" your opponent did it.
Thus, "Here's another old scam for your examination". There's a million old scams... merely running them online is not very interesting.
I wonder what the internet equivalent is of "stealing neighbors yard signs" and "standing withing 500 feet of the polling place and campaigning" for internet voting and internet fraud.... I haven't figured that one out yet. Fake donation collection and fake voting information is almost too obvious/simple.
When will people look beyond the letter and actually see the candidates? Then maybe will will get some better ones.
Unlikely, if they had vision that good, they'd look beyond the candidates too, and see they have identical donors, so there's not much difference.
What is different is the PR campaigns. One side wants to primarily use the government tactics (which has merged with big business) to destroy the middle class, and the other side wants to primarily use big business tactics (which has merged with the government) to destroy the middle class.
Personally I used to be a fan of having big business destroy my class, but then the bible thumpers and extremists took over and kicked all the normal people out, so now I lean toward having the government destroy my class. Right or wrong, assisted suicide is illegal on an individual medical basis; however on a national basis its not only legal but compulsory. Oh well.
More likely age and familiarity with technology. Republicans tend to skew old.
Its more a faith based thing. "I have faith that a website with a picture of Rmoney on it must give its money to Rmoney, just like money sent to my televangelist goes straight to Jesus"
Hey just a quick reminder, election day this year for 3rd party candidates has been moved up to Tuesday November 6th so they have extra time to count handwritten "Ron Paul" write in votes and stuff like that... so if you're voting libertarian party, or really any 3rd party, anyone other than -R or -D, PLEASE show up at the polls on Tuesday November 6th, mkay? And if you're voting for a -R or -D then DO NOT show up at the polls until Wednesday November 7th this year. I'd really appreciate your help and if you could copy this to your facebook and G+ and twitter and all that, I'd really appreciate it as a personal favor. Please make sure that any -D or -R voters you know, won't show up at the polls until the 7th, OK?
TLDR is the voting commission has split presidential voting by party to reduce crowds, all 3rd party voters = vote on Tuesday Nov 6th, and D/R voters please don't arrive at the polls until Wednesday Nov 7th!
What entry-level web hosting provider would you recommend using instead of Go Daddy?
Everyone loves hurricane electric. Rather than using a webhost everyone hates like godaddy, why not use a webhost everyone loves like he.net, even ex-customers like me? Trust me, no one is stupid enough to hire me as a booth babe, so you know this is not astroturfing.
And I don't wanna hear comments from the peanut gallery about how they're not the cheapest. Yes, not being the cheapest is often a side effect of not sucking.
If you got 2 weeks... a single day off for an interview would be 10%.
Exactly. WRT to AC dropping "five whole hours" on an interview... I interviewed at a rather dilbertian F50 megacorp and it was about 8 hours aka 10% of my annual vacation. Ugh. Never should have wasted my time. They did take me out to lunch at a family dining establishment (Applebees level), which was nice of them.
Then again I usually take the whole day off for an interview even when its only about 5 minutes. I remember getting bait and switched about 20 years ago at a Major Cellphone Network Provider where I applied to be a RF cellsite engineer or whatever the exact terminology and somehow got shuffled around into call center monkey at about 1/4 my pay at the time. Basically HR worded the want ad to make me think they wanted someone to design, maybe project manage cell tower site installation/upgrades, which was more or less beneath my ability at the time, but what they actually wanted was a call center monkey to stick pins into a cork board map when angry customers were transferred to my extension complaining of dropped calls and then theoretically I'd "do something" with areas having lots of pins on the map, well, actually I'd just take calls but maybe I could work my way up to hand generating TPS reports or whatever. It was a call center job but the "engineering" dept job title meant unpaid overtime for them, what a great deal! Two hours of drive time round trip for 5 minutes of WTF, see ya.
Another WTF am I here for, was I had just completed a COBOL class at school (ahh, the 90s) and I had some experience setting up SDLC mainframe links over frame relay, I knew how to pull and terminate fiber, I had more or less worked as a network admin at a financial mainframe operation, etc. So there's an ad in the paper for what looks kinda like a sysprog or maybe devprog or maybe like an onsite local IBM CE except employed by the client. I get there and it turns out they have outsourced the computer operator positions but they need a local monkey to take care of physical paper handling at the line printers and would I like to work there for about $7/hr? WTF are you kidding me? bye bye.
I've learned over the years that before you go onsite if the nice HR lady can't explain the job duties that means there is no point in showing up for the interview.
"Worlds most F'd up interviews" would make an entertaining/. discussion.
Who's wandering around cemeteries going "Gee, if I only had detailed biographical information on this random dead dude?"
They're called genealogists. All I really know about my G-G-G-G-Grannie is where she's buried, so... yeah that would be me/us. Its a fun life long hobby. It can tend to be a bit of a grind, much some psuedo-RPG computer games have quests like "gimme 50 wolf pelts" some genealogists spend inordinate amounts of time collecting ancient census records or pictures of gravestones or whatever.
You know whats really freaky? I've got 30 year old digitized pictures of gravestones that were barely readable then and are completely unreadable now. I'm older than granite or at least cheap granite.
Tombstones are horribly expensive. At present, i don't think the idea of being able to engrave a significant amount of data into the stone itself is practical.
Don't confuse the "death industry" which sucks as much money as possible out of grieving people with technological limitations and actual economic issues.
Ask a machinist how much a substandard (by machinist standards, aka less smooth than a front surface mirror, etc) granite surface plate would cost, or perhaps a home center big box store how much the cutout for the sink in a granite counter top costs. Then talk to some engravers. Be careful because they also tend to price aspirationally, so if a bridesmaids gift should cost $50 guess how much the engraved whatever will be priced at... of course the cost to engrave is much less.
Tombstone's always going to be priced at $1000 because thats the most the grieving family can afford to pay, but there's so much profit built in that the cost to create that tombstone is pretty much a rounding error of the price charged. So it'll cost $10 of QR code engraving to make that $1000 tombstone instead of $5 now. Eh.
If our forebears had done this a hundred years ago, great-great-grandad's brief biography would be encoded on a bronze punch-card in an encoding nobody can find the documentation for. Text, on the other hand, has been working just fine for millenia.
So encode in text instead of a zip file of a rar file of a par2 archive of a DRMed video codec.
Amusingly enough as a "retrocomputing enthusiast" I can read paper tape and punch cards using Mark I Eyeball pretty well. I have to look up online at the numerous wikis and pdf documentation collections to remember exactly how it works for each media and device, but its no great challenge to reverse engineer given some raw material. If you think what amounts to the most trivial possible substitution code imaginable will utterly stump future generations of cryptographers then you must have an extremely "idiocracy" view of the future.
Something like a UPC code complete with checksum verification isn't too hard to do in your head and/or reverse engineer. Been there done that. That's life when you're bored and working retail.
A QR code might be a bit of a challenge. URLs would suck to reverse engineer, if you'd never seen a URL, but a text QR code of my long and distinguished/. posting history would be pretty easy to figure out since its merely substandard english language prose.
You have to realize the military cryptographers and DRM hackers are pretty good at pulling digital information outta sources when the source tries their best to stop them... given a dataset where no one is trying to stop them, your average cryptographer is just going to laugh at how easy it is. Why, paper tape and punch cards are just simple substitution ciphers, given enough english language prose, a simple frequency analysis of glyphs will crack it wide open, assuming you don't notice one of the obvious binary encodings is in binary order alphabetically (little endian vs big endian)
Slashdot Mirror
The backup plan is you ask the ATC. Ask a pilot. Even "couple hours training" noob like myself knows that. Its considered extremely bad form to tell the ATC "I'm too Fing lazy to look up the approach plate, whats the ILS freq again?" but if you have an equipment breakdown they have procedures and policies in place for generations now to help you out.
As for plane docs, it doesn't really matter as long as the ipad is highly reliable. You use the same checklist over and over to make sure you don't forget anything... its 99.999% good without a checklist (literally) so once or twice is no big deal.
There is some truth that the ipad will probably be more up to date and less likely to have a page torn out or coffee dumped on it than paper. It'll likely be more reliable as a system, even if it doesn't degrade smoothly.
And if HFT gets trading companies more money, then that money has to come from somewhere and if it's not coming from other trading companies, then it must be coming from the investors.
There's a pretty good argument that HFTs screw retail investors out of sub-cent price increments both at purchase and sale, lets call it one cent total per share over the ownership of the share. So over the life of a purchase and sale of 100 shares of my electric company stock, which trades at about $40, I'm getting screwed out of $10 commission for purchase and sale, thats $20 subtotal, plus about one cent total times 100 shares equals a buck. So my total screw cost is $21 on a roughly $4000 transaction. Compared to almost any market, real estate, anything, thats pretty good.
Yes is sucks being screwed outta that dollar. If its any consolation my father traded back when commission charges were something like $75, or a total screw cost of $150. So be careful if you wish for the good ole days, because you just might find that you save $1 in HFT "losses" but lost $130 in higher commission fees.
Compared to say, corruption in real estate, I'm not sure HFT is worth worrying about.
I'm not sure I completely understand your position, but I'm pretty sure you just reinvented the market maker job/position and reinvented the limit order. google/wiki for them and see how similar your idea is. We've had those for a long, long time and it has no impact on HFT operation.
You say the quantization is arbitrary, I say that the allowed time scales are arbitrary
OK that's an interesting, although very unusual way to look at it. For generations, increasing transparency and making the market free-er has been a goal. If you wanna reverse that its going to be a hard slog, as long as you've got a good enough story maybe you can do it. "we hate the rich" hasn't worked very well so far, but maybe...
You say the market is being restricted in how it can evaluate values, I say the market is being allowed to make irrational evaluations.
OK you're confusing the market, which sets rules, and evaluations aka prices. Maybe a /. car analogy would help? The market, enforced by men with guns aka the govt, says thou shalt buy/sell cars solely in values of $1000 a piece. In other words, you may only price cars in increment of thousands. You can enforce trades only happen with 3 zeros at the end of the price, but you can't enforce thoughts in brains of sub-thousand dollar prices. So you and I in an unfree market can only buy/sell our cars at $1K, $2K for used or $20K, $21K new, etc. HOWEVER used car dealers are making trades of 10 1997 Saturn cars for... lets say $9K for 10 of them, because in the dealer's brain its only worth exactly $900 and they can't be forced at the brainstem level to not think about sub-thousand dollar pricing. Insert all kinds of complaining that retail car buyers can't purchase a $900 car therefore (wrongly) the dealers are ripping them off. The real source of the "ripoff" is the unfree market... if the market rules allowed retail investors to buy a 1997 Saturn for $900 then the car dealer "HFT" market would cease to exist.
I do think though that "the market" should be fairly unfettered, but it should always reflect the considered choices of human minds.
There ya go. The problem is one set of minds said we're gonna trade in cents and anyone trading smaller than cents goes to jail (literally), and another set of minds said we can calculate value more accurately than cents. Mush the two together along with sufficient capital and its almost a self organizing system how HFT automagically evolves. Or on another scale they said retail investors are only allowed to trade in cents but big firms can do fractional cents, because big firms will keep each other honest but big firms will always screw their customer when rounding fractional pennies or whatever justification. There is no one single correct human mind so all you need to do is get rid of diversity of opinion and it'll be no problemo.
The reason retail trading is dying is HFT has eroded people's confidence in the shell game Wall Street setup.
Yeah whatever. I don't think that enters into many 401K / IRA / corporate pension purchasing decisions. Especially not for the 14 million americans (or whatever the figure is) who no longer have jobs, or the folks who can't afford investment anymore, or the people who cashed it all in related to housing price collapse short sales, or whatever. YES I agree with you sentiment / animal spirits is strongly negative, no I disagree that other more practical reasons are the primary reason.
HFT does not result in higher liquidity.
I hope you worked on the IT side or something other than the economic side... hard to argue that executing "lots of orders all the time" somehow doesn't affect liquidity. That's kind of the definition of liquidity? Lots of orders laying around waiting for you to toss yours in so it clears rapidly... kinda like ... the definition of HFTs...
It's just skimming with no intent on long term investment.
Yeah well thats a policy issue that has nothing to do with your previous statement. I'm not even sure there's a moral argument against it.
Everyone felt ticketmaster's service charge was out of whack. The same is true of HFT.
Please enlighten the world on how HFT causes increased charges. On a big scale thats a lot of investment and the trading firms are going to squeeze the blood outta the retail investors eventually... assuming that industry wide all players as a net make money off HFT, which they probably don't. On a small scale its zero sum, its trading corp A making 50 cents off trading corp B's loss of 50 cents.
Well of course the NYSE could not act alone, or would have to make sure the majority of traders wanted this.
No, not the majority of traders, thats not going to do it at all, you need the entirety of all markets to act. All of them. Simultaneously.
Its like those discussions "if only we never invented the nuclear bomb, how much better the world be if it never existed, if only magic could uninvent it" blah blah. Not terribly practical.
You don't gamble if you can have a working market that gives you a normal return of about 5-6%.
Right, because mgmt which currently demands a ridiculous rate of return above the market would do a 180 if returns were higher and maybe demand a lower return than the market or something. If the market returned 5% you'd just end up with some exec trying to get 10% implementing HFT. I'm not buying your scenario.
I don't want to 'ban' anything except gov't manipulation of money.
Right and a HFT bashing discussion is a good horse to hang on to in order to push another unrelated agenda. An agenda which I happen to agree with. But I don't think your tactic is helping "our" cause very much. HFT has about as much to do with the unfree banking markets as it does with astrology or numerology.
The internet is full of people who have strong opinions about things they have absolutely no knowledge of.
In the 80s it was
1) They use junk bonds which are bad because I say so and the logical reason why is ....
2)
3) Profit !!!
In the 10s it seems to be
1) They use HFT which are bad because I say so and the logical reason why is ....
2)
3) Profit !!!
Whenever you see someone talking solely about platitudes and cliches and never mention what a chemist would call the reaction mechanism explaining why whatever they're demonizing has any connection with an assortment of bad results, assume they're lying and/or starting a new religion.
There are lots of solutions here, the NYSE should select one.
That'll work well, because there's only one stock market in the whole world and no one has thought up the idea of pool trading/markets. Errr, um, more likely this would be an effective way to make the NYSE basically eliminate itself from the trading ecosystem...
i could invest in good ideas and ventures based on how much they would pay off in dividends, not inflated stock prices.
You might invest there, but few other people would. See its like an onion and no matter how deep you think you've dug there's a deeper layer. I REALLY don't want to invest in dividend stocks because I want to control when to pay income taxes on my investment's growth. I do own some electric company stock and some PHB at the powerco decides when and how much tax I should pay on their growth. I hate that. Which is probably why I have less than 5% of my investments in dividend yielding stocks. I would much rather pay long term cap gains when I'm retired at a nice low income so a nice low tax rate, rather than every year now at the peak of my income. Furthermore the power of compounding means at retirement I'll have more money to be taxed less, because I'm not getting taxed on dividends every quarter. Non-dividend yielding stocks are kinda the poor man's IRA, sorta, in that you don't pay taxes on them until you want to, probably when you retire.
The root cause behind HFT is
SEC rule 612
My advice is if you don't know the rules don't pontificate on the philosophy of the game's rules. You accurately listed several things that suck. I agree with you on your list and your interpretation of your list. Unfortunately your list has very little to do with why HFT exists.
Of-course the actual solutions aren't even accepted on silly public forums, and they are definitely not going to be accepted by the politicians
The SEC is controlled by private firms that control politicians, not the other way around. If you really want to destroy HFT, for whatever reasons, the way to do it is to convince trading firms that if you want sub-penny price discovery, you could continue the buildout of your rather baroque and expensive HFT infrastructure, or you could just tell your elected pawns in the govt to tell the SEC to modify rule 612 to force rounding to the nearest dollar or the nearest millionth of a penny.
If you round to the nearest dollar no one will ever (famous last words) accumulate enough capital to HFT. If you round to the nearest millionth of a penny then millions of dollars of infrastructure will only bring in fractional millionths of a penny times perhaps millions of trades per day or about a thousand bucks a year. Which compared to buying federal bonds at roughly 0 percent or soon to be defaulting muni bonds at -100% is actually not that bad of a return on equity, but anyway...
Either way the only way for HFT to exist is to set the quantum interval for trading to be "about a penny" which ... tada happens to be right exactly what its set to. I think the way the game's rules are set up precisely perfectly to maximize HFT profits does kinda indicate the people in charge of the market at the big firms want it to be that way, this is not some kind of weird coincidental engineering accident.
The only real long term effect of destroying HFT would likely be to heavily reduce the transfer of wealth from the FIRE sector to the telecom and IT sector. I'm not sure anyone outside the FIRE sector would benefit by that... I like having the FIRE sector crooks, in a small way, subsidize my IT and telecom service.
The NYT article sucked. Can't wait for print journalism to die.
1) Here's some authorities who are authorities because we say so, who are fighting like little middle school drama queens
2) Everyone loves a good "rich people suck and they're corrupt
3) Rabble rousing tired old cliche of "kids have no idea what they're doing vs old people are obsolete"
If you want the real story try Stucchio's blog series beginning at:
http://www.chrisstucchio.com/blog/2012/hft_apology.html
My pitiful TLDR summary of Stucchio's work combined with some other observations
1) Idiotic SEC rule 612 quantizes share price into small enough increments that you can raise the capital to HFT and increments that are large enough that you can make some serious dough doing HFT. HFT is not caused by Bolshevists in your bathroom or too many atheists or gobblin infestations, its caused by a stupid SEC rule that was created in a snap of the fingers and can go away just as quick.
2) Ask ANY EE or "real" telecom guy HFT is a real world application of dithering to improve resolution. Oh the "real" price of a share is 100.003 but we're only allowed to report price to a resolution such that its either of two quantum states 100.00 or 100.01. Simple system solution? Dump out 10 orders, 3 at 100.01 and 7 at 100.00 to meet some idiotic SEC rule. Now "everyone" knows the real free market price is signalled at 100.003 even if the unfree market is only allowed to trade at one cent increments.
3) Most of the whiners on both sides have a dog in the fight, if they are in the business and can't HFT for whatever reason they hate HFT and if they can they love it. Or they're just doing witchcraft style persecution where no logical mechanism is necessary... my sheep died therefore we should hang some old woman is no different than my dotcom bombed therefore we should punish a successful HFT trader "just because".
4) The ratio of HFT trading vs retail trading is absolutely exploding not entirely because HFT is growing (although it is...) but because retail trading is absolutely dying. Retail is dying for two reasons: Headed into next down leg of the second great depression (bubbles usually melt up in price and down in volume) and demographic stuff like looking at labor force participation graphs tens of millions of working age americans are no longer working, therefore there is no need to invest their 401K and IRA money from non-existent jobs. So yes HFT is growing but don't make the mistake of thinking the ratio of HFT to retail is in any way relevant, because retail is terminally ill and almost dead.
5) Some elderly/lazy people get all confused about frontrunning (which is illegal) because both frontrunners and HFTers are nuts crazy about low latency and fast execution. Therefore they obviously must be the same, at least to an idiot. This is about as intelligent as the anti-vaxers ... "Getting hit in the head by a 2x4 causes stupidity... high levels of lead in the blood cause stupidity... therefore getting hit in the head by a 2x4 results in high blood levels of lead". Morons.
6) Some lazy people enter market orders instead of limit orders. Probably not a wise idea any time in the last 150 or so years, although it is an even worse idea when retail volume is melting down and HFT volume is melting up. You could ban market orders for retail investors, but stupid people are always going to find a way to lose money, so I'm not sure there's any point to it. There's an infinite pool of ways for morons to lose money so removing one isn't going to really change the outcome. Its not the end of the world in that any average long term retail investor trade has just about zero odds of being stuck in a "flash-anything" related HFT event.
Election organisers also pull tricks like that all the time, like deliberatly under-allocating polling locations to districts they know would tend to vote for the enemy so some of the voters give up upon seeing the queue running around an entire city block.
I have personally seen this old scam with my own eyes in the same city. The spanish-only school polling site next to the homeless shelter and near the college has greater than one hour lines (I was a student at that school), same city nearby the hospital where the rich doctors own houses right next door to the poor young renters like myself, aka roughly 50:50 voting results had reasonable short lines, same city solidly middle class subdivision nobody living there is much below 60K and much above 120K but they're almost all quislings (giant W poster/vinyl sign was on one guy's garage door for about 4 years), never seen a "D" yard sign, so needless to say we've got 3 times the number of poll workers and they are young enough (relatively) that they can actually hear people speak, so its walk in walk out voting no wait.
This is one of the very few ways its harder to corrupt internet voting... I donno how you make the average huffpo browser harder to vote than the average fundamentalist church voter... maybe you could release a "pre-voting mandatory virus scanner" that takes 10 times as long to scan if it sees evidence of visiting the "wrong" part of the internet as defined by the virus scanner author.
There's a million old scams... merely running them online is not very interesting.
I hate to reply to myself, and contradict myself, but I believe I just invented a new form of voter fraud in the last hour while thinking about this. Unlike all the other example I thought of, this is unique and new to the internet age and never existed before in identical format in meatspace.
Take witches cauldron. Mix in:
1) A decent rootkit to intercept and modify all traffic in and out of a box
2) Deep monitoring and tracking sufficient to categorize a PC as D or R owned (for example, tracking cookies from fundie church = R owner, installed "I love Obama" app on his itunes connected iphone = D owner)
3) All internet voting involves lots of bits of data to make a one bit vote
Simply write your malware to do nothing if monitoring/tracking indicates victim is in a demographic group on your side. If they're on the other side, flip their vote. So they clicked party "A" and their screen shows party "A" but the rootkit intercepted and sent party "B" and any attempt to review their vote online shows party "A" just as they suspect.
Now the lots of bits to vote a single bit choice means another interesting rootkit option is to simply intercept and pick a random vote selection... 50:50 odds (roughly) that you guess correctly, and if wrong the voter/victim assumes they mistyped, so they try again at which point your malware shows the flipped bit other guy as their voter....
This new form of fraud in internet voting can be combined with traditional fraud. For example outsource malware to India, that way you know it'll never work, with it designed to screw yourself over. Since it doesn't work, you won't be harmed, and you can release the evidence to the press to "prove" your opponent did it.
Thus, "Here's another old scam for your examination". There's a million old scams... merely running them online is not very interesting.
I wonder what the internet equivalent is of "stealing neighbors yard signs" and "standing withing 500 feet of the polling place and campaigning" for internet voting and internet fraud.... I haven't figured that one out yet. Fake donation collection and fake voting information is almost too obvious/simple.
When will people look beyond the letter and actually see the candidates? Then maybe will will get some better ones.
Unlikely, if they had vision that good, they'd look beyond the candidates too, and see they have identical donors, so there's not much difference.
What is different is the PR campaigns. One side wants to primarily use the government tactics (which has merged with big business) to destroy the middle class, and the other side wants to primarily use big business tactics (which has merged with the government) to destroy the middle class.
Personally I used to be a fan of having big business destroy my class, but then the bible thumpers and extremists took over and kicked all the normal people out, so now I lean toward having the government destroy my class. Right or wrong, assisted suicide is illegal on an individual medical basis; however on a national basis its not only legal but compulsory. Oh well.
More likely age and familiarity with technology.
Republicans tend to skew old.
Its more a faith based thing. "I have faith that a website with a picture of Rmoney on it must give its money to Rmoney, just like money sent to my televangelist goes straight to Jesus"
Hey just a quick reminder, election day this year for 3rd party candidates has been moved up to Tuesday November 6th so they have extra time to count handwritten "Ron Paul" write in votes and stuff like that... so if you're voting libertarian party, or really any 3rd party, anyone other than -R or -D, PLEASE show up at the polls on Tuesday November 6th, mkay? And if you're voting for a -R or -D then DO NOT show up at the polls until Wednesday November 7th this year. I'd really appreciate your help and if you could copy this to your facebook and G+ and twitter and all that, I'd really appreciate it as a personal favor. Please make sure that any -D or -R voters you know, won't show up at the polls until the 7th, OK?
TLDR is the voting commission has split presidential voting by party to reduce crowds, all 3rd party voters = vote on Tuesday Nov 6th, and D/R voters please don't arrive at the polls until Wednesday Nov 7th!
Hmm, attacking innocent people at random, could have sworn there was some other word for that...
"US Military Drone Attack" Hmm thats 4 words.
"Civil forfeiture" Hmm 2 words.
"Obama" or "Bush" ? Yeah I founds it.
What entry-level web hosting provider would you recommend using instead of Go Daddy?
Everyone loves hurricane electric. Rather than using a webhost everyone hates like godaddy, why not use a webhost everyone loves like he.net, even ex-customers like me? Trust me, no one is stupid enough to hire me as a booth babe, so you know this is not astroturfing.
And I don't wanna hear comments from the peanut gallery about how they're not the cheapest. Yes, not being the cheapest is often a side effect of not sucking.
If you got 2 weeks... a single day off for an interview would be 10%.
Exactly. WRT to AC dropping "five whole hours" on an interview... I interviewed at a rather dilbertian F50 megacorp and it was about 8 hours aka 10% of my annual vacation. Ugh. Never should have wasted my time. They did take me out to lunch at a family dining establishment (Applebees level), which was nice of them.
Then again I usually take the whole day off for an interview even when its only about 5 minutes. I remember getting bait and switched about 20 years ago at a Major Cellphone Network Provider where I applied to be a RF cellsite engineer or whatever the exact terminology and somehow got shuffled around into call center monkey at about 1/4 my pay at the time. Basically HR worded the want ad to make me think they wanted someone to design, maybe project manage cell tower site installation/upgrades, which was more or less beneath my ability at the time, but what they actually wanted was a call center monkey to stick pins into a cork board map when angry customers were transferred to my extension complaining of dropped calls and then theoretically I'd "do something" with areas having lots of pins on the map, well, actually I'd just take calls but maybe I could work my way up to hand generating TPS reports or whatever. It was a call center job but the "engineering" dept job title meant unpaid overtime for them, what a great deal! Two hours of drive time round trip for 5 minutes of WTF, see ya.
Another WTF am I here for, was I had just completed a COBOL class at school (ahh, the 90s) and I had some experience setting up SDLC mainframe links over frame relay, I knew how to pull and terminate fiber, I had more or less worked as a network admin at a financial mainframe operation, etc. So there's an ad in the paper for what looks kinda like a sysprog or maybe devprog or maybe like an onsite local IBM CE except employed by the client. I get there and it turns out they have outsourced the computer operator positions but they need a local monkey to take care of physical paper handling at the line printers and would I like to work there for about $7/hr? WTF are you kidding me? bye bye.
I've learned over the years that before you go onsite if the nice HR lady can't explain the job duties that means there is no point in showing up for the interview.
"Worlds most F'd up interviews" would make an entertaining /. discussion.
The only people that would be able to apply are people who are unemployed.
"I can't believe I wasted 10% of my annual vacation days on this stinking interview" Been there done that.
Who's wandering around cemeteries going "Gee, if I only had detailed biographical information on this random dead dude?"
They're called genealogists. All I really know about my G-G-G-G-Grannie is where she's buried, so ... yeah that would be me/us. Its a fun life long hobby. It can tend to be a bit of a grind, much some psuedo-RPG computer games have quests like "gimme 50 wolf pelts" some genealogists spend inordinate amounts of time collecting ancient census records or pictures of gravestones or whatever.
You know whats really freaky? I've got 30 year old digitized pictures of gravestones that were barely readable then and are completely unreadable now. I'm older than granite or at least cheap granite.
Tombstones are horribly expensive. At present, i don't think the idea of being able to engrave a significant amount of data into the stone itself is practical.
Don't confuse the "death industry" which sucks as much money as possible out of grieving people with technological limitations and actual economic issues.
Ask a machinist how much a substandard (by machinist standards, aka less smooth than a front surface mirror, etc) granite surface plate would cost, or perhaps a home center big box store how much the cutout for the sink in a granite counter top costs. Then talk to some engravers. Be careful because they also tend to price aspirationally, so if a bridesmaids gift should cost $50 guess how much the engraved whatever will be priced at... of course the cost to engrave is much less.
Tombstone's always going to be priced at $1000 because thats the most the grieving family can afford to pay, but there's so much profit built in that the cost to create that tombstone is pretty much a rounding error of the price charged. So it'll cost $10 of QR code engraving to make that $1000 tombstone instead of $5 now. Eh.
If our forebears had done this a hundred years ago, great-great-grandad's brief biography would be encoded on a bronze punch-card in an encoding nobody can find the documentation for. Text, on the other hand, has been working just fine for millenia.
So encode in text instead of a zip file of a rar file of a par2 archive of a DRMed video codec.
Amusingly enough as a "retrocomputing enthusiast" I can read paper tape and punch cards using Mark I Eyeball pretty well. I have to look up online at the numerous wikis and pdf documentation collections to remember exactly how it works for each media and device, but its no great challenge to reverse engineer given some raw material. If you think what amounts to the most trivial possible substitution code imaginable will utterly stump future generations of cryptographers then you must have an extremely "idiocracy" view of the future.
Something like a UPC code complete with checksum verification isn't too hard to do in your head and/or reverse engineer. Been there done that. That's life when you're bored and working retail.
A QR code might be a bit of a challenge. URLs would suck to reverse engineer, if you'd never seen a URL, but a text QR code of my long and distinguished /. posting history would be pretty easy to figure out since its merely substandard english language prose.
You have to realize the military cryptographers and DRM hackers are pretty good at pulling digital information outta sources when the source tries their best to stop them... given a dataset where no one is trying to stop them, your average cryptographer is just going to laugh at how easy it is. Why, paper tape and punch cards are just simple substitution ciphers, given enough english language prose, a simple frequency analysis of glyphs will crack it wide open, assuming you don't notice one of the obvious binary encodings is in binary order alphabetically (little endian vs big endian)