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> The good news is that hedge funds are not advertisers and don't care about particular individuals This sounds disingenuous; it's not hard for the author or a

> The good news is that hedge funds are not advertisers and don't care about particular individuals This sounds disingenuous; it's not hard for the author or anyone else to imagine how Wall Street could use personally identifiable information, and the author claims to be at least somewhat sophisticated in the 'big data' field. Also, it's an industry that has an incredible track record of fraud, even fixing the bedrock interest rates like Libor, prides itself on an anything-goes atmosphere, and disdains regulation.

digler999 10y ago
I could see them passing "insider consumer info" on black markets just like they pass insider information. How handy would it be for a life insurance company to know which of its customers is googling for "chest pain" or "$CANCER_TYPE symptoms". A car insurance company would love to know which drivers go to bars on saturday night, or which ones make it from point A to point B in suspiciously low amounts of time. Wall street could creep into this by saying to either industry: "let our guys crunch the numbers and let us make book on what these rates should be...because market efficiency". It'll seem like a great idea at first, the data will be "anonymized" (except for when it's not, like when that guy pays a $5k to an analyst at the insurance company for the table mapping "anonymized" customer idns to ssns. Suddenly hedge funds get really good at guessing which pools should be invested in, or which drivers should be packaged into the high-risk tier. A few years later there's a moderate scandal, a fine is levied equal to ~5% of the illicit gains made, meanwhile the funds have moved on to perpetuate their next round of fraud.
- hackuser 10y ago
  Also, learning information about individuals: Big clients, competitors, employees, critics, journalists, politicians, etc. etc.

digler999 10y ago

I could see them passing "insider consumer info" on black markets just like they pass insider information. How handy would it be for a life insurance company to know which of its customers is googling for "chest pain" or "$CANCER_TYPE symptoms". A car insurance company would love to know which drivers go to bars on saturday night, or which ones make it from point A to point B in suspiciously low amounts of time. Wall street could creep into this by saying to either industry: "let our guys crunch the numbers and let us make book on what these rates should be...because market efficiency". It'll seem like a great idea at first, the data will be "anonymized" (except for when it's not, like when that guy pays a $5k to an analyst at the insurance company for the table mapping "anonymized" customer idns to ssns. Suddenly hedge funds get really good at guessing which pools should be invested in, or which drivers should be packaged into the high-risk tier. A few years later there's a moderate scandal, a fine is levied equal to ~5% of the illicit gains made, meanwhile the funds have moved on to perpetuate their next round of fraud.

hackuser 10y ago
Also, learning information about individuals: Big clients, competitors, employees, critics, journalists, politicians, etc. etc.