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This sort of plausible deniability depends on there being financial instruments which are genuinely difficult to understand. I'm sure you would agree that there

This sort of plausible deniability depends on there being financial instruments which are genuinely difficult to understand. I'm sure you would agree that there are in fact mechanisms and systems in computer programming which would be fairly difficult to explain quickly. Especially in terms which are anything approaching accuracy.

collyw 11y ago
As software professionals we (some of us take) pride in trying to build stable systems that are decoupled and not overly complex. Financial systems seem to be build the opposite way.
- lmm 11y ago
  A finance person would probably say the exact opposite - most deals are just stacking two or three obvious, properly factored/decoupled abstractions together, whereas software people seem (to a finance person) to deliberately complicate things.
- pjmorris 11y ago
  Richard Bookstaber makes very similar points about the financial system in 'A Demon of Our Own Design', highly recommended. When the investment banks were partnerships, the partners had plenty of 'skin in the game', and favored stable systems. Going public took the pressure off of the leadership's individual fortunes... and stability seems to have suffered.
- VLM 11y ago
  Yet think of surviorship bias, isn't the code most likely to end up in front of a jury the hackiest, most complicated, least understandable, least documented stuff out there? Think of the VW "scandal" at what point does a piece of code go from being a really effective emissions blocker to being an illegal emissions blocker? If they implemented and trained up a neural net then what piece of code is the violator, the guy who wrote the unit tests the neural net trained on, or the evolved coefficients in the network that humans never wrote, or the manager who told them to write an emissions routine using a NN or the regulators who entrapped them by knowingly writing bad regs with the intention of the .gov selecting winners and losers by selective prosecution?
- harryh 11y ago
  They only seem that way to you because you do not deal in finance. A system can only be as simple as the business needs it's supporting whether than be a piece of code or a financial product. Some pieces of code are VERY complex because the business demands it. Same goes for financial instruments.
  - collyw 11y ago
    Is there a real reason for them to be so complex though? "Buisness demands it" isn't really a reason for me. It clearly affects the stability of the system, so shouldn't we look at ways of improving it overall?
    - harryh 11y ago
      Well you can't just say "them." That would be like saying "is there a reason that all that software is so complicated?" There are lots and lots and lots of different reasons for all the different pieces of code in the world. Same thing for financial products.

collyw 11y ago

As software professionals we (some of us take) pride in trying to build stable systems that are decoupled and not overly complex. Financial systems seem to be build the opposite way.

lmm 11y ago
A finance person would probably say the exact opposite - most deals are just stacking two or three obvious, properly factored/decoupled abstractions together, whereas software people seem (to a finance person) to deliberately complicate things.
pjmorris 11y ago
Richard Bookstaber makes very similar points about the financial system in 'A Demon of Our Own Design', highly recommended. When the investment banks were partnerships, the partners had plenty of 'skin in the game', and favored stable systems. Going public took the pressure off of the leadership's individual fortunes... and stability seems to have suffered.
VLM 11y ago
Yet think of surviorship bias, isn't the code most likely to end up in front of a jury the hackiest, most complicated, least understandable, least documented stuff out there? Think of the VW "scandal" at what point does a piece of code go from being a really effective emissions blocker to being an illegal emissions blocker? If they implemented and trained up a neural net then what piece of code is the violator, the guy who wrote the unit tests the neural net trained on, or the evolved coefficients in the network that humans never wrote, or the manager who told them to write an emissions routine using a NN or the regulators who entrapped them by knowingly writing bad regs with the intention of the .gov selecting winners and losers by selective prosecution?
harryh 11y ago
They only seem that way to you because you do not deal in finance. A system can only be as simple as the business needs it's supporting whether than be a piece of code or a financial product. Some pieces of code are VERY complex because the business demands it. Same goes for financial instruments.
- collyw 11y ago
  Is there a real reason for them to be so complex though? "Buisness demands it" isn't really a reason for me. It clearly affects the stability of the system, so shouldn't we look at ways of improving it overall?
  - harryh 11y ago
    Well you can't just say "them." That would be like saying "is there a reason that all that software is so complicated?" There are lots and lots and lots of different reasons for all the different pieces of code in the world. Same thing for financial products.