7 ms·

> I mean, the first person on their "Patron Saints of Techno-Optimism" is Jeff Bezos No, it's an anonymous Twitter account, you read the name wrong, "Beff Jezo

> I mean, the first person on their "Patron Saints of Techno-Optimism" is Jeff Bezos No, it's an anonymous Twitter account, you read the name wrong, "Beff Jezos" (sic), not "Jeff Bezos". Also if you look at the purest form of markets, which is probably high frequency trading, there are no monopolies and no cartels. It's an intensely competitive industry with relatively small profits given their transaction volume.

PaulDavisThe1st 3y ago
If that's "the purest form" of something, give me the dirty version any day. An utterly useless human activity, that does nothing for actual humanity but simply serves as a wealth redistribution technique shared among a tiny number of highly-self-interested individuals ... it might be "pure" but it's not "pure" in any way.
- stevenhuang 3y ago
  You don't understand market making and it's not ok to pretend you do.
  - skulk 3y ago
    Instead of reaching for this horribly irritating snark (I'm sure GP understands market making enough to understand why HFT exists), why not be charitable and consider the opportunity cost of the smartest people spending their mental energy to create a slightly more efficient market? Is this really a responsible use of this resource?
    - stevenhuang 3y ago
      Consider a similar irritation when seeing those with a superficial grasp of a complex topic oversimplify and make unwarranted conclusions. And it's precisely the GPs unwavering certainty that HFTs are net negative that accurately informs they do not understand the full implications of what HFTs offer. Because when you're aware of the full picture, it is not at all obvious society will be better off without it. https://news.ycombinator.com/item?id=37912662 https://news.ycombinator.com/item?id=37912662
  - TheLegace 3y ago
    I don't know if you have been on the other side of what market makers do, but its not exactly a day at the beach. Once you gain enough insight to see whats going on the charts you just see it as a graveyard of traders positions, stop losses and their capital. This happens every minute the market is open at every timeframe. Have you ever wonder why the markets appear so irrational? Great economic data and the worse drop in months or vice versa. These are the expectations, emotions and psychology of the masses that are liquidated by market makers. Have you also just had a gut instinct to buy or sell and market moves completely opposite beyond your psychological limit. Only for it to start moving into profit once you have closed at a huge loss. This is all market makers do all day. In principle there is nothing immoral here. Participants are all taking risks voluntarily, no one is forcing you risk trading the stock market. But in practice market makers take positions at the stop losses 90% of market participants giving them significantly overwhelming supply of assets at the best prices, while everyone else sees consistent intractable losses. This is a Darwinian environment where only the biggest, fiercest and most aggressive players will win by killing weaker, smaller and less knowledgeable players. The only way for a small fish to win is to understand the rules the market makers play by. Their strengths, desires, weaknesses, limitations and once you do you realize that this was someone's capital, but it's also capital not going to the market makers.
    - PaulDavisThe1st 3y ago
      I think you intended to reply to me (GP), not the parent. You're ignoring my objection to this stuff, which has nothing to do with immorality and everything to do with with the waste and misdirection of resources. Why do people participate in this stuff? Because someone might get rich. From my POV, that's a waste and misdirection of resources. People getting rich is not the right motivation for pareto or utilitarian optimal allocations.
      - RandomLensman 3y ago
        People are entitled to do things that are not an optimal resource allocation. Social systems that block that tend be very nasty.
      - 3y ago
throwaway38475 3y ago
I don't think that's correct. Access to the fiber links or colocation in a facility is not only ridiculously expensive you have to know the right people (the cartel) to get it done. I can't just offer a crazy amount of money and get access, the other major players have to let me play.
- jeffreyrogers 3y ago
  You actually can just offer a (not very large) amount of money and get access. The fees aren't even that large and they are public see [1] for example. The startup costs for an HFT would be comparable to a restaurant buildout, it's really not a capital intensive business. [1]: https://www.nyse.com/publicdocs/Wireless_Connectivity_Fees_and_Charges.pdf https://www.nyse.com/publicdocs/Wireless_Connectivity_Fees_a...
gen220 3y ago
HFT is a dance in the shadows of the most highly-regulated practices in history (securities exchanges), I don't think it's a good example of "pure" markets being immune to monopolies. Each of those regulations is a tombstone for the monopolies and cartels that came before, and there will absolutely be more tombstones to come. The history of the stock market is rife with corruption, stock manipulation, and short-thrifting the general public. The great fortunes of the 20th century were made on the backs of practices that are all kinds of illegal today, and with good reason.

PaulDavisThe1st 3y ago

If that's "the purest form" of something, give me the dirty version any day. An utterly useless human activity, that does nothing for actual humanity but simply serves as a wealth redistribution technique shared among a tiny number of highly-self-interested individuals ... it might be "pure" but it's not "pure" in any way.

stevenhuang 3y ago
You don't understand market making and it's not ok to pretend you do.
- skulk 3y ago
  Instead of reaching for this horribly irritating snark (I'm sure GP understands market making enough to understand why HFT exists), why not be charitable and consider the opportunity cost of the smartest people spending their mental energy to create a slightly more efficient market? Is this really a responsible use of this resource?
  - stevenhuang 3y ago
    Consider a similar irritation when seeing those with a superficial grasp of a complex topic oversimplify and make unwarranted conclusions. And it's precisely the GPs unwavering certainty that HFTs are net negative that accurately informs they do not understand the full implications of what HFTs offer. Because when you're aware of the full picture, it is not at all obvious society will be better off without it. https://news.ycombinator.com/item?id=37912662 https://news.ycombinator.com/item?id=37912662
- TheLegace 3y ago
  I don't know if you have been on the other side of what market makers do, but its not exactly a day at the beach. Once you gain enough insight to see whats going on the charts you just see it as a graveyard of traders positions, stop losses and their capital. This happens every minute the market is open at every timeframe. Have you ever wonder why the markets appear so irrational? Great economic data and the worse drop in months or vice versa. These are the expectations, emotions and psychology of the masses that are liquidated by market makers. Have you also just had a gut instinct to buy or sell and market moves completely opposite beyond your psychological limit. Only for it to start moving into profit once you have closed at a huge loss. This is all market makers do all day. In principle there is nothing immoral here. Participants are all taking risks voluntarily, no one is forcing you risk trading the stock market. But in practice market makers take positions at the stop losses 90% of market participants giving them significantly overwhelming supply of assets at the best prices, while everyone else sees consistent intractable losses. This is a Darwinian environment where only the biggest, fiercest and most aggressive players will win by killing weaker, smaller and less knowledgeable players. The only way for a small fish to win is to understand the rules the market makers play by. Their strengths, desires, weaknesses, limitations and once you do you realize that this was someone's capital, but it's also capital not going to the market makers.
  - PaulDavisThe1st 3y ago
    I think you intended to reply to me (GP), not the parent. You're ignoring my objection to this stuff, which has nothing to do with immorality and everything to do with with the waste and misdirection of resources. Why do people participate in this stuff? Because someone might get rich. From my POV, that's a waste and misdirection of resources. People getting rich is not the right motivation for pareto or utilitarian optimal allocations.
    - RandomLensman 3y ago
      People are entitled to do things that are not an optimal resource allocation. Social systems that block that tend be very nasty.
    - 3y ago

throwaway38475 3y ago

I don't think that's correct. Access to the fiber links or colocation in a facility is not only ridiculously expensive you have to know the right people (the cartel) to get it done. I can't just offer a crazy amount of money and get access, the other major players have to let me play.

jeffreyrogers 3y ago
You actually can just offer a (not very large) amount of money and get access. The fees aren't even that large and they are public see [1] for example. The startup costs for an HFT would be comparable to a restaurant buildout, it's really not a capital intensive business. [1]: https://www.nyse.com/publicdocs/Wireless_Connectivity_Fees_and_Charges.pdf https://www.nyse.com/publicdocs/Wireless_Connectivity_Fees_a...

gen220 3y ago

HFT is a dance in the shadows of the most highly-regulated practices in history (securities exchanges), I don't think it's a good example of "pure" markets being immune to monopolies. Each of those regulations is a tombstone for the monopolies and cartels that came before, and there will absolutely be more tombstones to come. The history of the stock market is rife with corruption, stock manipulation, and short-thrifting the general public. The great fortunes of the 20th century were made on the backs of practices that are all kinds of illegal today, and with good reason.