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When I was in high school, my math teacher instilled me with the value of always labeling axes when plotting graphs. This GIF provides us with exactly no inform

When I was in high school, my math teacher instilled me with the value of always labeling axes when plotting graphs. This GIF provides us with exactly no information on anything, but it sure seems scary enough. The line is getting higher and more erratic! This can’t be good! Let’s piece apart some of the language here: * “High-Speed Trading Bots Go Berserk” — doesn’t mean anything, they’re processes, they’re just following their algorithm. * “…unnerving the financial markets.” — doesn’t mean anything, ‘markets’ don’t have nerves. In fact, I once wrote about the dangers of reification: http://blog.zacharyvoase.com/2012/03/31/reification/ http://blog.zacharyvoase.com/2012/03/31/reification/ * “activity becomes much, much more frenetic and erratic” — to a human observer. These algorithms don’t have concepts of ‘frenetic’ or ‘erratic’; neither does the universe. * “…so complex that its potential systemic repercussions are literally unknowable” — suggests that systemic repercussions of anything were ever ‘knowable’. If they were, we wouldn’t have markets. c.f.: http://mises.org/daily/2608/ http://mises.org/daily/2608/ Don’t just read. Think. Thanks.

jobu 14y ago
Based on the Nanex article (http://www.nanex.net/aqck/2804.HTML http://www.nanex.net/aqck/2804.HTML), it appears the chart is showing thousands of quotes per second on the left, vs time of day on the bottom.
mvzink 14y ago
Yeah, but you have to admit that this is pretty skilled sensationalist journalism :P How convenient Nanex didn't include labels in the graphics they provided! [1] In fact, they specifically say that high frequency trading doesn't concern them, and are talking about quote spamming. Not. The. Same. The animated graph used in the article combines metrics of both, as far as I can tell, but Nanex makes it clear that High Frequency Trading is stalled or declining while High Frequency Quoting is on the rise. Furthermore, the bit saying "activity becomes much, much more frenetic and erratic" is just... totally silly. Partly because of what you mentioned, but also because... well I don't know what else to say, it's just so utterly, embarrassingly silly. I'd wager the graph's movement isn't even nearly as 'frenetic' as the stock market itself. In any case, it's quite clear that the author didn't even peek at the page he got the graph from. Ugh. This kind of 'journalism' makes me sick. [1] http://www.nanex.net/aqck/2804.HTML http://www.nanex.net/aqck/2804.HTML linked all-too-subtly in the article
coolgeek 14y ago
> ‘markets’ don’t have nerves Seriously? Market participants certainly have nerves, and it is perfectly clear to anyone without an ideological axe to grind that the term "market" is used here as shorthand for "market participants". Don't just write. Think. Thanks.

jobu 14y ago

Based on the Nanex article (http://www.nanex.net/aqck/2804.HTML http://www.nanex.net/aqck/2804.HTML), it appears the chart is showing thousands of quotes per second on the left, vs time of day on the bottom.

mvzink 14y ago

Yeah, but you have to admit that this is pretty skilled sensationalist journalism :P How convenient Nanex didn't include labels in the graphics they provided! [1] In fact, they specifically say that high frequency trading doesn't concern them, and are talking about quote spamming. Not. The. Same. The animated graph used in the article combines metrics of both, as far as I can tell, but Nanex makes it clear that High Frequency Trading is stalled or declining while High Frequency Quoting is on the rise. Furthermore, the bit saying "activity becomes much, much more frenetic and erratic" is just... totally silly. Partly because of what you mentioned, but also because... well I don't know what else to say, it's just so utterly, embarrassingly silly. I'd wager the graph's movement isn't even nearly as 'frenetic' as the stock market itself. In any case, it's quite clear that the author didn't even peek at the page he got the graph from. Ugh. This kind of 'journalism' makes me sick. [1] http://www.nanex.net/aqck/2804.HTML http://www.nanex.net/aqck/2804.HTML linked all-too-subtly in the article

coolgeek 14y ago

> ‘markets’ don’t have nerves Seriously? Market participants certainly have nerves, and it is perfectly clear to anyone without an ideological axe to grind that the term "market" is used here as shorthand for "market participants". Don't just write. Think. Thanks.