Why does Goldman come up every time HFT comes up? Goldman has a reputation for hard selling (advising to buy) instruments to its customers that it wants to get rid of due to being considered toxic. Such as the cdos. Those practices are deplorable. But HFT is, overall, beneficial to investors, traders and the market as a whole.
That tax makes no sense either in its original form or in its later amended form. It was trying to prevent countries for having to increase interest rates caused by speculators suddenly selling their holding in the currency. But he apparently didn't notice that those holdings occur on the order of seconds or less. Therefore the net effect is 0. Also, the amount of currency on offer at a bad price is limited. When the arbitrageur hits that price level there will be no more, unless someone quotes more badly priced currency. Arbitrage necessarily makes the market more efficient, and the faster the more so. An almost identical argument applies to stocks.
Actually, that would merely serve to widen the spreads, and the cost would be borne by the investors, not the HFT market makers. Market makers are the ones whose prices appear on the books. A market maker makes less than a tick on each trade. Market makers are in competition with each other. If the bid-ask spread were 1c but the trades had a fee of more than that, the market maker would lose money. So they would have to set the spread greater than he fee. This doesn't hurt the market maker. In fact, hurting the market maker is a bad idea in general. It reduces liquidity, decreases efficiency and increases cost to all traders. What problem are you trying to solve here?
Another factor was that the underlying assumption that changes in the values of the various CDOs were uncorrelated was completely incorrect. As a result portfolios that were considered risk-neutral were actually time bombs.
Without full downside risk? 1.The cancelled trades were executed way off of any reasonable price. 2. They lost $440,000,000 3. Every study I've read had concluded that HFT benefits the market in general and regular investors in particular. HFT helps correct for human irrationality and helps keep markets efficient and liquid. This LOWERS the cost to investors.
You're thinking short term. Run away global warming could be the end of life as we know it. Perhaps not in our lifetime. And perhaps that's why many people would rather deny it or claim it's not all bad.
Nope. Theft is clearly defined as the permanent deprivation of the property. Reducing the property's value is deprivation, but not of the property itself. Fail. By your argument the government is stealing your dollars when they increase the monetary supply, because it reduces the value of your dollars (assuming you have some).
Er, copying something doesn't deprive the owner of the original. And yes, that's the legal definition of theft. No matter how much you want it to it just doesn't mean copying.
I would once have agreed with this. Now I almost do. I certainly think that the vast majority of modern software patents are bullshit and offer nothing new. I have, however, come across some software techniques that are truly novel, and couldn't be achieved without a computer. An example would be one that was invented by a friend of mine. It's a method of making certain floating point operations commutative. It's a great technique, and it isn't obvious by any means. It's also very useful. Mathematically it's barren, since the operations are already commutative on reals. So it's only useful because computers have limitations. This kind if thing really is a useful invention, and deserves the kind of protection that the patent provides. IMHO, of course.
Patents were created to give the inventor a monopoly over the invention for a limited period of time in return for disclosure of the workings, design etc. The point being that society benefits for inventions that might not otherwise be published and shared. Intellectual property is a combination of trade marks, copyrighted work and patents. Stealing is permanently depriving someone of some of his property. Please explain exactly which kind of intellectual property you are talking about, and how it's possible to steal it. Further, explain what that has to do with how much land farmer Joe can work; and exactly what it is that happens more quickly now. The only thing that would make it possible to steal the various kinds of intellectual property would be to define it to mean something different. Which would be pointless, since we already have a plethora of words for whatever kinds of malpractice that may be performed on intellectual property.
How about the ballot has a matrix of candidate preference. I.e the candidates are listed across the top and down the side, and you check the box whereever you prefer the candidate on the left to the one at the top. Any ballots that are not transitive or complete are discarded. Anyone too stupid to understand will very likely not count toward the total.;)
Then the doctor has to understand how the algorithm arrived at its conclusion. Unfortunately, the algorithms used by netflix and Amazon et al don't actually have any understanding of the causes - merely correlations in the data - so they are unable.
Slashdot Mirror
Very well said.
This is a widespread, ill informed opinion.
All the research points to the exact opposite: HFT lowers overall trading cost.
Why does Goldman come up every time HFT comes up?
Goldman has a reputation for hard selling (advising to buy) instruments to its customers that it wants to get rid of due to being considered toxic. Such as the cdos.
Those practices are deplorable.
But HFT is, overall, beneficial to investors, traders and the market as a whole.
That tax makes no sense either in its original form or in its later amended form.
It was trying to prevent countries for having to increase interest rates caused by speculators suddenly selling their holding in the currency. But he apparently didn't notice that those holdings occur on the order of seconds or less. Therefore the net effect is 0. Also, the amount of currency on offer at a bad price is limited. When the arbitrageur hits that price level there will be no more, unless someone quotes more badly priced currency.
Arbitrage necessarily makes the market more efficient, and the faster the more so.
An almost identical argument applies to stocks.
What's the point of discouraging arbitrage?
Actually, that would merely serve to widen the spreads, and the cost would be borne by the investors, not the HFT market makers.
Market makers are the ones whose prices appear on the books. A market maker makes less than a tick on each trade. Market makers are in competition with each other. If the bid-ask spread were 1c but the trades had a fee of more than that, the market maker would lose money. So they would have to set the spread greater than he fee. This doesn't hurt the market maker.
In fact, hurting the market maker is a bad idea in general. It reduces liquidity, decreases efficiency and increases cost to all traders.
What problem are you trying to solve here?
Another factor was that the underlying assumption that changes in the values of the various CDOs were uncorrelated was completely incorrect. As a result portfolios that were considered risk-neutral were actually time bombs.
None of that applies to HFT
Without full downside risk?
1.The cancelled trades were executed way off of any reasonable price.
2. They lost $440,000,000
3. Every study I've read had concluded that HFT benefits the market in general and regular investors in particular. HFT helps correct for human irrationality and helps keep markets efficient and liquid. This LOWERS the cost to investors.
You're thinking short term. Run away global warming could be the end of life as we know it.
Perhaps not in our lifetime. And perhaps that's why many people would rather deny it or claim it's not all bad.
You're only looking at cost.
You should look at reward too.
Probably because it's mostly affecting children.
Nope. Theft is clearly defined as the permanent deprivation of the property.
Reducing the property's value is deprivation, but not of the property itself.
Fail.
By your argument the government is stealing your dollars when they increase the monetary supply, because it reduces the value of your dollars (assuming you have some).
Er, copying something doesn't deprive the owner of the original.
And yes, that's the legal definition of theft.
No matter how much you want it to it just doesn't mean copying.
I would once have agreed with this. Now I almost do. I certainly think that the vast majority of modern software patents are bullshit and offer nothing new.
I have, however, come across some software techniques that are truly novel, and couldn't be achieved without a computer.
An example would be one that was invented by a friend of mine. It's a method of making certain floating point operations commutative. It's a great technique, and it isn't obvious by any means. It's also very useful.
Mathematically it's barren, since the operations are already commutative on reals. So it's only useful because computers have limitations.
This kind if thing really is a useful invention, and deserves the kind of protection that the patent provides. IMHO, of course.
Patents were created to give the inventor a monopoly over the invention for a limited period of time in return for disclosure of the workings, design etc. The point being that society benefits for inventions that might not otherwise be published and shared.
Intellectual property is a combination of trade marks, copyrighted work and patents.
Stealing is permanently depriving someone of some of his property.
Please explain exactly which kind of intellectual property you are talking about, and how it's possible to steal it.
Further, explain what that has to do with how much land farmer Joe can work; and exactly what it is that happens more quickly now.
The only thing that would make it possible to steal the various kinds of intellectual property would be to define it to mean something different. Which would be pointless, since we already have a plethora of words for whatever kinds of malpractice that may be performed on intellectual property.
How about the ballot has a matrix of candidate preference. I.e the candidates are listed across the top and down the side, and you check the box whereever you prefer the candidate on the left to the one at the top. ;)
Any ballots that are not transitive or complete are discarded.
Anyone too stupid to understand will very likely not count toward the total.
The word you're looking for is loses not looses.
Only 5?
It's a believers choice, except that they teach that it's more or less a sin not to tithe 10%...
Still... Scientology is worse.
Patient stats has a much higher dimentionality than netflix picks. It's not as simple as plugging in an existing algorithm.
Then the doctor has to understand how the algorithm arrived at its conclusion.
Unfortunately, the algorithms used by netflix and Amazon et al don't actually have any understanding of the causes - merely correlations in the data - so they are unable.
If your netflix screws up you don't die as a result.
I get .033ms for coworkers. Except for other locations - there is a speed of light issue...
Actually, the ground state has positive energy.