Intruder at the top of the 20 meter amateur band?(ka7oei.blogspot.com)
ka7oei.blogspot.com
Intruder at the top of the 20 meter amateur band?
http://ka7oei.blogspot.com/2020/12/intruder-at-top-of-20-meter-amateur-band.html
186 comments
> If it was approved, it seems remarkably fast to build a tower given that the article was from Dec 15th.
It makes sense they moved quickly, since there's a limited time period where they'd have this advantage over other firms which set up similar systems.
It makes sense they moved quickly, since there's a limited time period where they'd have this advantage over other firms which set up similar systems.
There's an update at the bottom:
- Delmarva Broadband is authorized 14.35-14.99 MHz at 186 kW. Contact is a law office in DC. See https://apps.fcc.gov/els/GetAtt.htm
- … and M-Wave is authorized the 14-14.99 MHz at 16 kW. See https://apps.fcc.gov/els/GetAtt.htm
- Delmarva Broadband is authorized 14.35-14.99 MHz at 186 kW. Contact is a law office in DC. See https://apps.fcc.gov/els/GetAtt.htm
- … and M-Wave is authorized the 14-14.99 MHz at 16 kW. See https://apps.fcc.gov/els/GetAtt.htm
Well, it shouldn't be hard at that power level to find the transmitter if you're anywhere nearby.
Here's the site in Aurora, Illinois. Note that their permit expires next month.
https://goo.gl/maps/boqMG4aCrShatHtq8
https://goo.gl/maps/boqMG4aCrShatHtq8
Kilowatts? wtf
So much for that hobby.
Where were those links supposed to go anyhow?
So much for that hobby.
Where were those links supposed to go anyhow?
Maybe there's a hobby in receiving their trading data and having software react to it — following milliseconds behind their trade.
They’re already 5 moves ahead by the time it hits market.
Milliseconds are an eternity.
...it will be encrypted
How much time does encryption take? I'd wager the fastest links are close to plaintext.
Stream ciphers can operate without adding any extra delay and are considered plenty strong.
At HF bitrates they can use a one-time pad. The only unbreakable cipher.
A single hard drive shipped (or hand-delivered) to each transmitter location ought to last a decade.
A single hard drive shipped (or hand-delivered) to each transmitter location ought to last a decade.
No need to ship a hard drive, just send it over the regular internet.
It would be an interesting exercise to design an encryption and compression protocol that has a high bandwidth/high latency link and a low bandwidth/low latency link working together.
It would be an interesting exercise to design an encryption and compression protocol that has a high bandwidth/high latency link and a low bandwidth/low latency link working together.
> No need to ship a hard drive, just send it over the regular internet.
Well, then it isn't an unbreakable cipher anymore.
It's only as strong as whatever encryption you used to transmit the pad over the clearnet. If you were using a one-time pad to do that then you used up the pad in the process, so you could've just told the reciever to transfer the pad from their internet-decryptor to their HF-radio decryptor.
Well, then it isn't an unbreakable cipher anymore.
It's only as strong as whatever encryption you used to transmit the pad over the clearnet. If you were using a one-time pad to do that then you used up the pad in the process, so you could've just told the reciever to transfer the pad from their internet-decryptor to their HF-radio decryptor.
The inexact coordinates in the image lead to the front yard of some farm. Now I can't stop thinking of Kash Hill's Maxmind story
ref: https://www.google.com/maps/place/41°36'00.0"N+88°36'00.0"W/
ref: https://splinternews.com/how-an-internet-mapping-glitch-turn...
ref: https://www.google.com/maps/place/41°36'00.0"N+88°36'00.0"W/
ref: https://splinternews.com/how-an-internet-mapping-glitch-turn...
Good HF antennas are large. Wouldn't at all be surprised to find them on some farm a few miles out of town.
For HFT purposes, it's hard to hide an intercontinental range HF antenna, particularly a directional one. I know at least 3 locations not far from the illinois CME datacenter, out in some fields, with huge yagi-uda antennas aimed at London and tokyo.
I'm curious as to UK end of the link now. I would guess somewhere on the hills around London to get line of sight for a microwave link down to the city.
Having just checked the Ofcom Spectrum Information System [0], it does not appear that they could have a transmitter for the opposite direction due to the frequency allocation to MoD and Amateur. Maybe they have a contract with the shortwave broadcasters to embed trading data into their broadcasts.
[0] https://www.ofcom.org.uk/spectrum/information/spectrum-infor...
Having just checked the Ofcom Spectrum Information System [0], it does not appear that they could have a transmitter for the opposite direction due to the frequency allocation to MoD and Amateur. Maybe they have a contract with the shortwave broadcasters to embed trading data into their broadcasts.
[0] https://www.ofcom.org.uk/spectrum/information/spectrum-infor...
What altitude would you have to be at to have line of site to Tokyo and London from Chicago?
They're probably aimed somewhere above and in between https://en.wikipedia.org/wiki/Skywave
They're probably aimed somewhere above and in between https://en.wikipedia.org/wiki/Skywave
You'd need to be in orbit.
Edit: actually it might not be possible at all from a single point anywhere in the universe.
Edit: actually it might not be possible at all from a single point anywhere in the universe.
I just stared at a globe, and it’s possible, but not from a geostationary orbit.
Think about a hemisphere projected onto a 2d circle - you can see all points on the surface of the hemisphere on the projection.
Logically it must be possible to select a hemisphere, such that any two random points on a sphere lie on that hemisphere, and would thus be visible in the projection.
The only edge cases is two points that are diametrically opposite - i.e north and south pole, which would only both be visible at infinite distance.
Points nearly diametrically opposed would only be visible from extreme distance.
This doesn’t take into account inconvenient mountains, but they can easily be moved.
Think about a hemisphere projected onto a 2d circle - you can see all points on the surface of the hemisphere on the projection.
Logically it must be possible to select a hemisphere, such that any two random points on a sphere lie on that hemisphere, and would thus be visible in the projection.
The only edge cases is two points that are diametrically opposite - i.e north and south pole, which would only both be visible at infinite distance.
Points nearly diametrically opposed would only be visible from extreme distance.
This doesn’t take into account inconvenient mountains, but they can easily be moved.
If the two points you select on the sphere are poles of eachother (ie, their distance through the sphere is equal to the sphere's diameter, then you need to have an infinite distance from the sphere.
What you're looking for is a triangle between the two points and a third point forming your observer. The two points are visible at the same time if the derivative of the sphere's surface and the side of the triangle between a point form a positive angle (the derivative intersects the triangle at a point other than the points).
So the question then becomes "if the two points are poles, what does that mean"; easy, if the two points are poles and they're only visible if the surface derivative is within the triangle, the angle between the observer, the point and the other point must be 90°. This must hold for both points as the solution is symmetric. However, there is no well defined triangle that has two angles of 90° inside.
So the solution is "doesn't work" (or possibly infinite distance).
What you're looking for is a triangle between the two points and a third point forming your observer. The two points are visible at the same time if the derivative of the sphere's surface and the side of the triangle between a point form a positive angle (the derivative intersects the triangle at a point other than the points).
So the question then becomes "if the two points are poles, what does that mean"; easy, if the two points are poles and they're only visible if the surface derivative is within the triangle, the angle between the observer, the point and the other point must be 90°. This must hold for both points as the solution is symmetric. However, there is no well defined triangle that has two angles of 90° inside.
So the solution is "doesn't work" (or possibly infinite distance).
In this case I was considering three points, but yeah, they're all in the northern hemisphere, so your scenario applies.
You will not usually have nor do you need line of sight for HF radio. The radio waves are reflected by the ionosphere at various angles and heights, allowing the signal to be received at many different distances at once. Radio waves at the correct frequency hit the ionosphere like stones skipping along the surface of water.
Assuming the same tower height at both ends, and ignoring refraction due to the atmosphere, I get that you would need 1500 mile tall towers for Chicago to Tokyo. (I did miles rather than meters because my Google for the distance between them came back in miles and I was too lazy to convert).
For Chicago to London I get 560 mile tall towers.
For Chicago to London I get 560 mile tall towers.
From Chicago ORD to Tokyo NRT is 6274 miles on great circle. Distance around world is 24901 miles.
Two towers add 1120 miles (and ignoring extra length of straight line transmission compared to great arc) then a fibre optic cable on great arc would be faster than straight line if light signal within fibre travels at > 85% of speed of light (also ignoring slowdown by atmosphere for radio).
Two towers add 1120 miles (and ignoring extra length of straight line transmission compared to great arc) then a fibre optic cable on great arc would be faster than straight line if light signal within fibre travels at > 85% of speed of light (also ignoring slowdown by atmosphere for radio).
> For HFT purposes, it's hard to hide an intercontinental range HF antenna, particularly a directional one. I know at least 3 locations not far from the illinois CME datacenter, out in some fields, with huge yagi-uda antennas aimed at London and tokyo.
Got any pictures?
Got any pictures?
https://hackaday.com/2018/05/12/hft-on-hf-you-cant-beat-it-f...
With more traditional microwave for the last hop.
With more traditional microwave for the last hop.
ARRL mentioned this stuff in June 2018, then crickets.
The second link on ka7oei's page, a 2018 discussion among hams, names a few of the perps' ID's. It said 'WJ2XGD' was the only one licensed on 20m.[0] Quote: 'Emission bandwidth shall not extend beyond the bandlimits' = 14-14.99.
They're -not- required to ID themselves [Section 5.115] (an eyebrow-raiser).[1]
[0] https://apps.fcc.gov/els/GetAtt.html?id=204018&x=. [License to M-Wave Networks LLC, Illinois]
[1] https://forums.qrz.com/index.php?threads/ham-radio-mentioned...
This long, archived page about HFT tech briefly considers the HF option considerations (search for 'HAM radio')
[2] [https://web.archive.org/web/20171012010437/https://meanderfu...]
The second link on ka7oei's page, a 2018 discussion among hams, names a few of the perps' ID's. It said 'WJ2XGD' was the only one licensed on 20m.[0] Quote: 'Emission bandwidth shall not extend beyond the bandlimits' = 14-14.99.
They're -not- required to ID themselves [Section 5.115] (an eyebrow-raiser).[1]
[0] https://apps.fcc.gov/els/GetAtt.html?id=204018&x=. [License to M-Wave Networks LLC, Illinois]
[1] https://forums.qrz.com/index.php?threads/ham-radio-mentioned...
This long, archived page about HFT tech briefly considers the HF option considerations (search for 'HAM radio')
[2] [https://web.archive.org/web/20171012010437/https://meanderfu...]
Chicago to London one way is around 35ms over fibre but that could be down to 21ms over the air like this.
That signal is only about 10-15khz wide[1] from that diagram. That’s not a whole lot of data transfer ability, measured in the low kbps range rather than mbps. Very low kbps when you add in error correction.
We are moving out of / have left the solar minimum so the MUF is usually well above the 20 metre band each day now so going forward, it might be a good capability to have while it lasts for the next 8 years or so.
[1] I don’t know what scale division the ticks at the top represent but the SSB signals to the left would be up to around 3khz wide.
That signal is only about 10-15khz wide[1] from that diagram. That’s not a whole lot of data transfer ability, measured in the low kbps range rather than mbps. Very low kbps when you add in error correction.
We are moving out of / have left the solar minimum so the MUF is usually well above the 20 metre band each day now so going forward, it might be a good capability to have while it lasts for the next 8 years or so.
[1] I don’t know what scale division the ticks at the top represent but the SSB signals to the left would be up to around 3khz wide.
One does not need a lot of bandwidth to trade successfully. In fact, a limited number of signals agreed upon ahead of time is enough. E.g. signal “A” could mean “buy 10 contracts”, signal “B” - “sell 100 contracts”, etc. And you can of course wrap 256 such signals into one byte. So transmitting a single byte at an opportune time let’s you control your trading on the other continent in a quite precise fashion. If you make such transmission, say, 10 times per day your bandwidth utilization is technically 10 bytes per day or about 0.001 bps - yet you can make a ton of money.
All you really need to do is to beat the trade you just saw enter the system so you can buy the trade out from under them and mark it up while their bits are still stuck in glass. You know, "provide liquidity".
Heh. Yeah I have no idea why everybody who isn't doing HFT hasn't decided to stop letting these guys rip them off and moved to
https://en.wikipedia.org/wiki/Investors_Exchange#Operating_p...
It's a great idea. But every time I see that name I can't keep my brain from moving the spaces around. I mean seriously what were they thinking with that name.
investor sex change
investors exchange
https://en.wikipedia.org/wiki/Investors_Exchange#Operating_p...
It's a great idea. But every time I see that name I can't keep my brain from moving the spaces around. I mean seriously what were they thinking with that name.
Yeah, why? Maybe because HFT actually do provide a service valuable to retail.
Or because retail have no choice but to lose a few tenths of a percent of every trade to HFT leeches..
That’s not at all how it works.
If not why do they need to have the lowest latency? Seems to me that if you want to provide liquidity what you need to do is buy a wide range of stocks and sit on them so they're all listed and available for trade. But you don't need extremely low latency for that. If you're providing liquidity you should be sitting on an insanely diverse portfolio at the end of every day. The whole point is to make sure trades are available so nobody is waiting for something to appear on the market.
When trading on exchanges no one can see your order before it makes it to the exchange, it’s literally a private connection directly to the exchange.
Once your order hits the exchange 1 of 2 things can happen, your order can trade (that is it immediately clears) and all participants get an update which shows the new state of the exchange (the previous state minus whichever order(s) your order matched against). Or your order doesn’t trade, it “rests” because your price doesn’t match what anyone else is offering. At that point your order is at the back of the queue at that price and all other participants get an update showing the new state of the market with your order added to the state.
So why is latency important? The most important reason is not adding orders, which is only important if no one is already quoting your price, it’s for cancelling orders. If you get some information that makes you think your orders are incorrectly priced you want to cancel them before anyone can take advantage of that and then get new orders in at the new price you think is correct. This information is either off exchange (e.g. the fed job report) or is on the current exchange or another similar one (e.g. some big hedge fund is selling a ton of Swiss Francs in European exchanges).
On the map in the article exist 2 exchanges, the CME and the ICE which trade different but highly correlated symbols (CME WTI oil and ICE Brent oil). If I see a price change on the CME for those correlated symbols I can bet with high confidence the price will change for the ICE symbols as well, so I’ll race to cancel my orders that don’t reflect that new anticipated price.
For market makers providing liquidity order management is as important if not more so than inventory management and that’s where speed reduces risk, allowing them to provide cheaper liquidity.
A market maker wants to end the day flat on inventory with well positioned orders. Holding a big portfolio of inventory is the worst case scenario.
Once your order hits the exchange 1 of 2 things can happen, your order can trade (that is it immediately clears) and all participants get an update which shows the new state of the exchange (the previous state minus whichever order(s) your order matched against). Or your order doesn’t trade, it “rests” because your price doesn’t match what anyone else is offering. At that point your order is at the back of the queue at that price and all other participants get an update showing the new state of the market with your order added to the state.
So why is latency important? The most important reason is not adding orders, which is only important if no one is already quoting your price, it’s for cancelling orders. If you get some information that makes you think your orders are incorrectly priced you want to cancel them before anyone can take advantage of that and then get new orders in at the new price you think is correct. This information is either off exchange (e.g. the fed job report) or is on the current exchange or another similar one (e.g. some big hedge fund is selling a ton of Swiss Francs in European exchanges).
On the map in the article exist 2 exchanges, the CME and the ICE which trade different but highly correlated symbols (CME WTI oil and ICE Brent oil). If I see a price change on the CME for those correlated symbols I can bet with high confidence the price will change for the ICE symbols as well, so I’ll race to cancel my orders that don’t reflect that new anticipated price.
For market makers providing liquidity order management is as important if not more so than inventory management and that’s where speed reduces risk, allowing them to provide cheaper liquidity.
A market maker wants to end the day flat on inventory with well positioned orders. Holding a big portfolio of inventory is the worst case scenario.
> When trading on exchanges no one can see your order before it makes it to the exchange, it’s literally a private connection directly to the exchange.
If the stock market was only one marketplace that would be true, but when your order goes out to multiple marketplaces that's where the trouble starts.
Are you claiming that if you offer to buy 10 shares of X at $10, but the price drops to $9.99 while you are hitting "execute" the system isn't smart enough to let it happen and your $10 order will sit unfulfilled? And that the HFT folks are so kind in letting you save time by marking it up for you? What a valuable service that couldn't easily be provided by my own system... /s
If the stock market was only one marketplace that would be true, but when your order goes out to multiple marketplaces that's where the trouble starts.
Are you claiming that if you offer to buy 10 shares of X at $10, but the price drops to $9.99 while you are hitting "execute" the system isn't smart enough to let it happen and your $10 order will sit unfulfilled? And that the HFT folks are so kind in letting you save time by marking it up for you? What a valuable service that couldn't easily be provided by my own system... /s
Even in multiple exchanges orders are always private before they execute if you are trading on an exchange (if you are trading through another venue this may not be true but in those cases latency is not an issue as there is no race).
If you send an order to buy at $10 and the lowest sell price is $9.99 you will not rest an order you will be filled at $9.99 before any other exchange participant can see your order.
Orders rest when you offer to buy at $9.98 but the lowest sell price is $9.99. At that point if you are the first person at that price level you will be first in line when someone tries to sell at $9.98. Otherwise you will be last in line even if the person in front of you put their order in by mail a month ago.
Respectfully that you need these concepts explained to you means you don’t know even the basics of how this works so holding a vehement position on it is a bad look.
It’s akin to someone hearing that udp is a lossy protocol and railing about it existing at all.
If you send an order to buy at $10 and the lowest sell price is $9.99 you will not rest an order you will be filled at $9.99 before any other exchange participant can see your order.
Orders rest when you offer to buy at $9.98 but the lowest sell price is $9.99. At that point if you are the first person at that price level you will be first in line when someone tries to sell at $9.98. Otherwise you will be last in line even if the person in front of you put their order in by mail a month ago.
Respectfully that you need these concepts explained to you means you don’t know even the basics of how this works so holding a vehement position on it is a bad look.
It’s akin to someone hearing that udp is a lossy protocol and railing about it existing at all.
Those were rhetorical questions. They were meant to show how silly the concept of "offering liquidity" is as a service. Nobody asked for it, but they can't opt out without doing crazy workarounds like delaying orders to different market to avoid giving away their trade information to front runners.
In my previous example if the highest sell price is $9.99 and you offer to buy at 9.98 you are “offering liquidity”.
It’s not a service that’s on offer it’s a fundamental market behavior that any participant can engage in.
It’s not a service that’s on offer it’s a fundamental market behavior that any participant can engage in.
Right, which is what I was talking about in the original post.
You don't need ultra-low latency to put in that $9.98 order to keep the market moving. If you were serious about providing liquidity you'd have tons of bids and offers open all the time. You would be holding tons of stock at the end of the day by the nature of the business.
HFT firms tell you that they are making life easier for traditional investors by providing liquidity, but that doesn't make much sense given how they operate.
You don't need ultra-low latency to put in that $9.98 order to keep the market moving. If you were serious about providing liquidity you'd have tons of bids and offers open all the time. You would be holding tons of stock at the end of the day by the nature of the business.
HFT firms tell you that they are making life easier for traditional investors by providing liquidity, but that doesn't make much sense given how they operate.
My entire point is you are not accurately describing how they operate.
Something similar was used for landing the original Mars Rovers - not actual full data telemetry channel but just a very simple very low bandwidth signal that can be translated to symbols, each signifying an important phase of the landing being reached.
[deleted]
I have no real opinion on HFT, but I think its outrageous the FCC allows people to interfere with other services like this. Let them use point-to-point microwave relays or fiber cables
This reminds me of the first ever "hack" that used semaphores (not the ones you're thinking of): https://www.amusingplanet.com/2019/03/the-worlds-first-cyber...
Hacking the semaphores is also plot device in "Count of Monte Cristo" causing the financial ruin of a villain.
I wonder if Dumas was inspired by Blanc brothers.
I wonder if Dumas was inspired by Blanc brothers.
Do exchanges like HF traders? I know HF traders themselves justify their own existence by claiming they provide liquidity to the markets, but I've always just sort-of rolled my eyes at that.
They only extract value and provide none, in my opinion, tax the profits heavily. I think every exchange should pad each order by a random number between 0 and 250ms, it would take care of it. The company profiled in this video add lag https://www.youtube.com/watch?v=d8BcCLLX4N4
Exchanges generally like (and provide incentives to) orders that add liquidity, which means orders that do not execute immediately. HFT orders are generally intended to not execute immediately, so exchanges would tend to like them. Of course, HFT also usually pays higher connection fees to get closer to the exchange, which probably doesn't hurt their relations with the exchange.
The dark pools that HFT firms setup to trade with retail investors are probably less enjoyed by the exchanges, but at the same time, it does reduce load at the exchange, so maybe it's mixed because it reduces the exchanges' income from commissions, but also reduces their expense from operations.
Padding orders by a random amount doesn't really discourage racing to get their first; if it's a uniform random, across all orders, you still want to get there first, which means you still want to get your order there quickly; and depending on implementation, you might break your order up into many smaller orders, so that some of them get there with less delay. If you wanted to disincentivize speed, what you really want to do is group orders that arrive in a given interval and treat them as arriving at the same time; you could do that with fixed intervals (1 minute, 1 second, 100 ms, whatever) or adaptive intervals based on the number of orders over the last interval, or randomly, if you like random.
From what I've seen from selling employer stock over the years, the commissions have gone down (to zero), and the bid/offer spreads have gone down, and both are due to HFT firms, so as far as I can see, HFT is helping me. I can't say I've noticed a difference in execution speed, trading always seemed pretty fast, as long as I was able to setup the order via the browser.
The dark pools that HFT firms setup to trade with retail investors are probably less enjoyed by the exchanges, but at the same time, it does reduce load at the exchange, so maybe it's mixed because it reduces the exchanges' income from commissions, but also reduces their expense from operations.
Padding orders by a random amount doesn't really discourage racing to get their first; if it's a uniform random, across all orders, you still want to get there first, which means you still want to get your order there quickly; and depending on implementation, you might break your order up into many smaller orders, so that some of them get there with less delay. If you wanted to disincentivize speed, what you really want to do is group orders that arrive in a given interval and treat them as arriving at the same time; you could do that with fixed intervals (1 minute, 1 second, 100 ms, whatever) or adaptive intervals based on the number of orders over the last interval, or randomly, if you like random.
From what I've seen from selling employer stock over the years, the commissions have gone down (to zero), and the bid/offer spreads have gone down, and both are due to HFT firms, so as far as I can see, HFT is helping me. I can't say I've noticed a difference in execution speed, trading always seemed pretty fast, as long as I was able to setup the order via the browser.
I agree with most of your post, but I don't think you can safely attribute broker commissions going to 0 to HFTs.
Payment for order flow comes from dark pools, run mostly by HFT. Payment for order flow incentives brokers to get more trades, and reduced commissions gets more trades. I don't know that other brokers would have gone all the way down to $0 without Robinhood pushing them, but they were already down to $5-$10.
Wasn’t Zecco doing $0 commissions back in 2006 already?
My understanding is that HFTs function in a complete race to the bottom, with the only profitable activity being to trade faster and with slightly faster information than the next HFT. There is no secret sauce to keep them from eating each other as the costs to create a new HFT are not all that high vs. the profit opportunity of shaving a few percent off the commissions of the dominant trading system. Faster links and faster trades between exchanges mean they carry less risk when carrying out arbitrage (while also lowering the amount of arbitrage available).
The fact they made crazy profits initially is more of an artifact that they were competing against humans rather than other automated systems. In a few years we may see them reach the point of diminishing returns where all exchanges share a common pool of liquidity that adapts in a few millis to new information.
The fact they made crazy profits initially is more of an artifact that they were competing against humans rather than other automated systems. In a few years we may see them reach the point of diminishing returns where all exchanges share a common pool of liquidity that adapts in a few millis to new information.
I'm sure the exchanges like the buckets of money that HFTs pay them, even on their discounted commission fees. There's also billions in industry just around supporting HFTs, including FPGAs, silicon fab, networking equipment, etc. The cost to society of killing HFTs would probably be fairly large and imo the drawbacks are mostly minor.
All of the money HFTs make would have been made by other investors, presumably for reasons more related to predicting or responding to actual changes in market conditions. HFTs are parasites that basically leech value from those trades by executing them faster than you can, and forcing you to buy at a higher/sell at a lower price. I think the platonic ideal of a marketplace involves making money by determining the actual value of goods, not stealing information from others and jumping the line.
They also contribute to a lot of market instability, see for instance the flash crash[1].
[1] https://en.wikipedia.org/wiki/2010_flash_crash
They also contribute to a lot of market instability, see for instance the flash crash[1].
[1] https://en.wikipedia.org/wiki/2010_flash_crash
I don't like these type of comments because they show little understanding of how the market works.
Explain the process in which the HFT firms "leech value" from your trades or "[steal] information and [jump] the line"? Your trade arrives at the exchange. Then, the HFT firms learn about your trade. They then price correct many instruments and derivatives that are all inter-related.
Now, if we are talking about quote stuffing or intentionally trying to DDoS exchanges, everyone agrees this is bad behavior and is regulated against.
Finally, as you mention, these type of algorithms contributed to market instability of the flash crash but it was also initiated by large (slow) directional bets. You propose taking the oxygen out of the room of a fire but one can also propose removing matches that started the fire.
Explain the process in which the HFT firms "leech value" from your trades or "[steal] information and [jump] the line"? Your trade arrives at the exchange. Then, the HFT firms learn about your trade. They then price correct many instruments and derivatives that are all inter-related.
Now, if we are talking about quote stuffing or intentionally trying to DDoS exchanges, everyone agrees this is bad behavior and is regulated against.
Finally, as you mention, these type of algorithms contributed to market instability of the flash crash but it was also initiated by large (slow) directional bets. You propose taking the oxygen out of the room of a fire but one can also propose removing matches that started the fire.
If prices are out of line, that definitely seems like a place where automated trading would be valuable. But HFTs' tech advantage isn't just about finding a better arbitrage algorithm or being smarter: it's also quite clearly about exploiting a pure technical advantage over other traders. The fact that HFTs are so willing to invest in speed even to achieve a tiny advantage over other HFTs kind of gives the game away.
And when people quite rightly observe that having a speed advantage over other traders obviously allows extractive behavior like frontrunning, a bunch of people on HN come out with irate counter-takes that claim HFT are an unalloyed good -- never something nuanced like, "yes HFT could allow for some extractive behavior, but it's counterbalanced by these advantages which I will explain in detail." (And the corollary, which is an explanation of "why a world where all traders have the same speed advantages wouldn't have all the claimed advantages of HFT but be even more efficient.")
I guess it's also worth pointing out that these responses are usually from people who are involved in the HFT industry in some way, and usually they start out by accusing people of "not understanding the industry". Which is precisely the accusation many make against HFT: that it's so deliberately opaque that people outside the industry can't possibly determine how much extraction there is compared to value being added. Saying "trust us" or "you couldn't possibly know because you aren't on the inside profiting from it" is not the compelling argument you think it is.
And when people quite rightly observe that having a speed advantage over other traders obviously allows extractive behavior like frontrunning, a bunch of people on HN come out with irate counter-takes that claim HFT are an unalloyed good -- never something nuanced like, "yes HFT could allow for some extractive behavior, but it's counterbalanced by these advantages which I will explain in detail." (And the corollary, which is an explanation of "why a world where all traders have the same speed advantages wouldn't have all the claimed advantages of HFT but be even more efficient.")
I guess it's also worth pointing out that these responses are usually from people who are involved in the HFT industry in some way, and usually they start out by accusing people of "not understanding the industry". Which is precisely the accusation many make against HFT: that it's so deliberately opaque that people outside the industry can't possibly determine how much extraction there is compared to value being added. Saying "trust us" or "you couldn't possibly know because you aren't on the inside profiting from it" is not the compelling argument you think it is.
> The fact that HFTs are so willing to invest in speed even to achieve a tiny advantage over other HFTs kind of gives the game away.
Re-pricing s&p500 futures offers in Chicago based on faster stock offer information from nyc is fine. It’s improving a market making strategy or taking offers that look like they will now be profitable.
> And when people quite rightly observe that having a speed advantage over other traders obviously allows extractive behavior like frontrunning
HFTs do not front run for fucks sake. It’s illegal and this meme needs to die. Front running is literally putting your order in front of a client’s order.
Being the fastest to realize the bottom is falling out of the s&p500 and selling the futures contracts on open bids is not front running.
Re-pricing s&p500 futures offers in Chicago based on faster stock offer information from nyc is fine. It’s improving a market making strategy or taking offers that look like they will now be profitable.
> And when people quite rightly observe that having a speed advantage over other traders obviously allows extractive behavior like frontrunning
HFTs do not front run for fucks sake. It’s illegal and this meme needs to die. Front running is literally putting your order in front of a client’s order.
Being the fastest to realize the bottom is falling out of the s&p500 and selling the futures contracts on open bids is not front running.
> HFTs do not front run for fucks sake. It’s illegal ...
This is objectively false. Cursing does not strengthen an argument. HFTs paid to jump the queue. It should be illegal but it is not. There are a number of low-latency strategies that are beneficial for price discovery such as index arbitrage or market-making (with requirements to stay in the market). A strategy that is not beneficial is to pay the exchange for first-look. That is front-running.
This is objectively false. Cursing does not strengthen an argument. HFTs paid to jump the queue. It should be illegal but it is not. There are a number of low-latency strategies that are beneficial for price discovery such as index arbitrage or market-making (with requirements to stay in the market). A strategy that is not beneficial is to pay the exchange for first-look. That is front-running.
First look is still not front running. Unless you are able to get your order in before other orders, it’s not front running. Get it?
Being the first to look at new orders is nice, but the orders are in the queue so there is no way to get in front of them.
Here is a link to help you: https://www.investopedia.com/terms/f/frontrunning.asp
It’s very well-defined in the industry and when you complain about something completely unrelated using that term it muddies the argument for the general public and makes you sound ignorant to the people involved with the industry (both regulators and private participants).
I cursed because it’s the same ignorant argument over and over spreading false information about how the market functions. Actual front running is illegal and companies would get shut down in a heart beat if they were doing it.
Being the first to look at new orders is nice, but the orders are in the queue so there is no way to get in front of them.
Here is a link to help you: https://www.investopedia.com/terms/f/frontrunning.asp
It’s very well-defined in the industry and when you complain about something completely unrelated using that term it muddies the argument for the general public and makes you sound ignorant to the people involved with the industry (both regulators and private participants).
I cursed because it’s the same ignorant argument over and over spreading false information about how the market functions. Actual front running is illegal and companies would get shut down in a heart beat if they were doing it.
Again, this is exactly the behavior I mentioned in the above post. When the general public raises the important question of how much extractive behavior there is in HFT and asks whether the benefits outweigh the value lost by disadvantaged parties, they get brushed off and told that they’re ignorant. Your response focuses on one specific technical allegation while casually admitting that yeah, maybe there’s another type of extractive behavior that happens but “don’t you know the difference between one technical definition of extractive behavior and another?” At the same time no actual answer is given to the core question — presumably the assumption being that unless you are in the HFT world you’re not qualified to have the question answered, even if it affects you and you’re paying for it.
It’s simple though, stop claiming people are breaking the law (front-running) if you want to have a productive discussion. It’s not a “technical detail”, it’s a fundamental property of not being able to beat an order that made it to the exchange before yours.
The reason your concerns are brushed off is because they are nonsensical to anyone who actually understands the market. You’re complaining about extractive behavior but are unable to articulate how it is actually happening and calling it “front running” shows that you definitely have no idea how HFT is making money.
Describe the steps by which you think having something like first look or just faster access to the exchanges allows HFTs to unfairly extract money from normal trades.
The reason your concerns are brushed off is because they are nonsensical to anyone who actually understands the market. You’re complaining about extractive behavior but are unable to articulate how it is actually happening and calling it “front running” shows that you definitely have no idea how HFT is making money.
Describe the steps by which you think having something like first look or just faster access to the exchanges allows HFTs to unfairly extract money from normal trades.
There’s an entire book by Michael Lewis that describes these steps. I don’t have enough knowledge to tell you how accurate his description is, and I’d be willing to hear a cogent argument in response. But if you agree that those activities are indeed happening and you’re simply claiming that the abuses he describes are not technically illegal or technically the SEC definition of “front running” then your point is noted and my response is: so what? That’s not a defense against the allegations.
> There’s an entire book by Michael Lewis that describes these steps.
Yes, it was widely derided as a one-sided argument used to support a new exchange (i.e. it was glorified marketing material). It was an entertaining book, but it excluded any realistic view about how “the evil side” works in his narrative.
> then your point is noted and my response is: so what? That’s not a defense against the allegations.
The point is that there are no fucking allegations here. When someone comes out and says, “I don’t like HFTs because they front run orders,” and the reply is “that’s not front running”, what is left to defend? They are being accused of a crime they aren’t committing because people don’t know what the crime is.
It’s like claiming the 7-eleven extorted you into buying a hot dog because they offered a 2 for 1 sale. Then someone points out that isn’t extortion. Then you say “so what? That’s not a defense against the allegations.”
Let’s put this another way. There is a reason that no regulation or arrests came out of flash boys. When you actually look at what HFTs do, there is nothing “unfair” to regular market participants. If you put in an order to sell AAPL at $125, there is no way for them to get ahead of that order in the exchange.
Yes, it was widely derided as a one-sided argument used to support a new exchange (i.e. it was glorified marketing material). It was an entertaining book, but it excluded any realistic view about how “the evil side” works in his narrative.
> then your point is noted and my response is: so what? That’s not a defense against the allegations.
The point is that there are no fucking allegations here. When someone comes out and says, “I don’t like HFTs because they front run orders,” and the reply is “that’s not front running”, what is left to defend? They are being accused of a crime they aren’t committing because people don’t know what the crime is.
It’s like claiming the 7-eleven extorted you into buying a hot dog because they offered a 2 for 1 sale. Then someone points out that isn’t extortion. Then you say “so what? That’s not a defense against the allegations.”
Let’s put this another way. There is a reason that no regulation or arrests came out of flash boys. When you actually look at what HFTs do, there is nothing “unfair” to regular market participants. If you put in an order to sell AAPL at $125, there is no way for them to get ahead of that order in the exchange.
i wonder this; if there is a stop loss already on the books at x price and a HFT enters a market order at that price when a stock is falling, which order will get filled first? i feel like answering this question would sort of answer the argument you guys are making?
as for useful work... we should really just be honest with ourselves/each other [and machine learning/ai might help us to do this] about what is actual useful work. it begs to challenge freedom, but ultimately i think we're headed for an efficiency level that will make the most efficacious worker look lazy af...
as for useful work... we should really just be honest with ourselves/each other [and machine learning/ai might help us to do this] about what is actual useful work. it begs to challenge freedom, but ultimately i think we're headed for an efficiency level that will make the most efficacious worker look lazy af...
I was in the industry (prop trading at BofA). I am no more ignorant than you. Here is a link to help you.
https://scholarship.law.duke.edu/cgi/viewcontent.cgi?article...
https://scholarship.law.duke.edu/cgi/viewcontent.cgi?article...
Speed and frontrunning are not equivalent. Frontrunning is an illegal practice. Here is an article from FINRA stating as much [0]. Of course, people are always looking for ways to accomplish this. Hell, sometimes the exchanges try to sell it as a feature [1]. Again, no one debates that these types of practices should be banned and penalized (they already are). I'm not inside "the industry" so I don't know if there are some firms that make profit from illicit means by abusing bugs and/or other loopholes where speed matters. However, speed is always an advantage when there are multiple exchanges that sell inter-related products. The same reason why computers are used instead of telephones.
You mention that HFT firms are willing to invest to beat other HFT firms gives the game away. We are both in agreement here but come to different conclusions. The arbitrage "algorithm" is simple in most cases. Futures contracts being sold in Chicago are at odds with equity prices in NYC. The first one to correct them wins. Speed is the only thing that matters. How exactly is people competing in the race "give the game away"?
[0] - https://www.finra.org/investors/insights/getting-speed-high-... [1] - https://www.sec.gov/news/press-release/2012-2012-189htm
You mention that HFT firms are willing to invest to beat other HFT firms gives the game away. We are both in agreement here but come to different conclusions. The arbitrage "algorithm" is simple in most cases. Futures contracts being sold in Chicago are at odds with equity prices in NYC. The first one to correct them wins. Speed is the only thing that matters. How exactly is people competing in the race "give the game away"?
[0] - https://www.finra.org/investors/insights/getting-speed-high-... [1] - https://www.sec.gov/news/press-release/2012-2012-189htm
It's also possible that HFTs make less money than other traders would have made, if HFT is actually making markets more liquid.
HFT does enhance liquidity and price discovery. The advantage to being "first" to trade is only there when multiple bidders are issuing orders at the exact same price point, and this is easily addressed by reducing minimum tick size so that price choices will just naturally disperse (as opposed to all being quantized at the same value).
Certainly exchanges love all paying customers.
The liquidity argument is a good one IMO. If you did not have participants willing to arbitrage fractions of a cent per share, it could be really difficult to get the ends to meet on a daily basis for things that arent traded with as much volume as monsters like TSLA/AMD/et. al.
The use of microwave links is just a natural consequence of competition within the HFT space. It might be reasonable to apply a minimum latency bound across the board as some participants have already, but I argue this would inhibit much of the innovation that got us to this point to start with. Being able to quickly clear a trade on thinly-traded securities is a wonderful thing for all involved. Capital not locked up in limit orders is more useful to humanity (in most cases).
The liquidity argument is a good one IMO. If you did not have participants willing to arbitrage fractions of a cent per share, it could be really difficult to get the ends to meet on a daily basis for things that arent traded with as much volume as monsters like TSLA/AMD/et. al.
The use of microwave links is just a natural consequence of competition within the HFT space. It might be reasonable to apply a minimum latency bound across the board as some participants have already, but I argue this would inhibit much of the innovation that got us to this point to start with. Being able to quickly clear a trade on thinly-traded securities is a wonderful thing for all involved. Capital not locked up in limit orders is more useful to humanity (in most cases).
Both yes and no. For most exchanges:
HF traders are big data consumers and they _have_ to have all the orderbook daa, so they're big customers of exchanges. They also pay for stuff like colocation.
Many exchanges also provide rebates for liquidty providing orders, which HF traders are incentivised to use.
One notable exception is the Investors Exchange (IEX), are vocally anti-HF.
HF traders are big data consumers and they _have_ to have all the orderbook daa, so they're big customers of exchanges. They also pay for stuff like colocation.
Many exchanges also provide rebates for liquidty providing orders, which HF traders are incentivised to use.
One notable exception is the Investors Exchange (IEX), are vocally anti-HF.
Could we not simply “batch” every trade within a second (or some nominal time value) to be concurrently executed?
I like your idea though.
I like your idea though.
Why suspect HFTs over other potential interfering applications? Could be anything, and unless I missed something, TFA doesn't show any evidence that the usage is HFT-motivated
The Chicago mercantile exchange is close to the center of the transmission. There are previous instances of HFT chasing low latency between Chicago and NYC, so it seems plausible this is something similar.
It is not proof of course. Plenty of other things could be happening in Chicago.
It is not proof of course. Plenty of other things could be happening in Chicago.
I wonder if high frequency sports betting is a thing.
Morality and outrage aside, we know where they are, and the format they are using, and they are in a fixed site. The real question is:
How can we:
1> receive and regenerate the source bit stream
2> use that to exactly recreate the transmitted signal
3> synchronized with that signal, and
4> then use it to cancel out the interference?
How can we:
1> receive and regenerate the source bit stream
2> use that to exactly recreate the transmitted signal
3> synchronized with that signal, and
4> then use it to cancel out the interference?
"Hello FTC I'd like a license to intentionally destructively interfere with a separate, licensed, broadcast -- which form should I fill out?"
That depends, are you a hobbyist or lobbyist?
To clarify... I'm not proposing to jam the signal, just cancel it out (in the receive channel) so we can listen without the annoyance.
With SDR gear, it should be possible to null out most, if not all of the signal, once the modulation format is known.
With SDR gear, it should be possible to null out most, if not all of the signal, once the modulation format is known.
Jamming is illegal.
Could be these guys - they are publicly advertising Chicago to Europe data link via HF radio (for traders, of course):
https://www.raft-tech.com/
https://www.raft-tech.com/
Indeed, the Bloomberg article they link to shows a photo of antenna towers in Aurora, Illinois near the Chicago Mercantile Exchange datacenter
https://www.bloomberg.com/news/articles/2020-06-17/companies...
https://www.bloomberg.com/news/articles/2020-06-17/companies...
That waterfall doesn't look like any sensible digital modulation to me, or at least if I were doing HFT, the spectrogram would look totally different.
I think the source is rather an unintentional radiator in this case.
I think the source is rather an unintentional radiator in this case.
Wouldn't a high frequency trader be building point to point links and thus benefit hugely from highly directional antennas? Seems like that would help with the interference quite a bit.
At that power any spill would still be a very strong signal.
Directional antennas are like gun silencers. They cause the signal to be many times weaker and it seems a lot until you figure out that the receiver works on a log scale and whatever is left is still registered as a strong signal.
Directional antennas are like gun silencers. They cause the signal to be many times weaker and it seems a lot until you figure out that the receiver works on a log scale and whatever is left is still registered as a strong signal.
Hope we don't see VHF or UHF traders soon.
There aren't a lot of advantages to VHF/UHF over the direct microwave links that they're already using (and a handful of disadvantages), so it's probably not likely.
The big perceived advantage to HF is eliminating all of the hops, despite the dramatically reduced bandwidth. With VHF/UHF, you'd still need the hops, but you also have reduced bandwidth. If you need to hop, might as well make use of the bandwidth that you can get with microwave.
The big perceived advantage to HF is eliminating all of the hops, despite the dramatically reduced bandwidth. With VHF/UHF, you'd still need the hops, but you also have reduced bandwidth. If you need to hop, might as well make use of the bandwidth that you can get with microwave.
"What is name of the shortwave band in the RF spectrum? High Frequency, HF, right? So, what should we use it for? Of course, High Frequency Trading over High Frequency!"
>What this means is that some entities are experimenting with the use of the HF bands for the most direct, point-to-point means of conveying this information possible.
Interesting that this is now being done with HF bands. For several years, however, this has already been done through the use of lasers (although at a far greater cost).
>Last year (2013), Anova completed a laser network link between the London and Frankfurt stock exchanges, and now, it seems the company is nearing completion on a similar laser network between the NYSE and NASDAQ data centers in Mahwah and Carteret, New Jersey.
https://www.extremetech.com/extreme/176551-new-laser-network...
Interesting that this is now being done with HF bands. For several years, however, this has already been done through the use of lasers (although at a far greater cost).
>Last year (2013), Anova completed a laser network link between the London and Frankfurt stock exchanges, and now, it seems the company is nearing completion on a similar laser network between the NYSE and NASDAQ data centers in Mahwah and Carteret, New Jersey.
https://www.extremetech.com/extreme/176551-new-laser-network...
Not sure I understand the point of using that band past amateur radio. Around 20m band is terrible for point to point communications. The antennas are huge, the bandwidth is low, the noise floor is really high and it’s prone to just about every annoying atmospheric condition possible.
Bandwidth doesn't need to be huge for HFT. If you can send a message saying "there was a big upward movement in the price of instrument X", that's enough to be incredibly valuable if it gets to the other end before anyone else knows about it. There might only be a few dozen instruments you're interested in, and a few events for each one, so being able to send a single byte could be enough.
Obviously, more bandwidth is useful, because you can send more details, and make better decisions at the receiving end. But most of the value is in getting a small message there fast.
Obviously, more bandwidth is useful, because you can send more details, and make better decisions at the receiving end. But most of the value is in getting a small message there fast.
Yeah this is just a narrow wormhole ~8ms into the future. You can pack all sorts of state around it via their existing low-latency fiber...probably just need a few bits over RF to do work.
I’m reminded of https://en.wikipedia.org/wiki/Communication_with_submarines#... where there’s just enough of a channel through the ocean to send a few symbols that mean something prearranged like “make contact ASAP.”
If you use 186 kilowatts, you can punch through much of that.
Someday the traders will be beaming neutrinos through the Earth.
Fermilab is very close to the CME data center and is focused on neutrino research now, maybe a good opportunity for a partnership for some extra funding...
...Maybe one day they'll have quantum entangled particles and they'll be able to do spooky things at a distance and communicate instantly?
I don't pretend to understand the physics, but sounds like it would be interesting... if it could work.
Perhaps then Radio Amateurs would become Amateur Tanglers?
While it is spooky interaction at a distance it can't be used to transfer information faster than light.
In simple terms, the states are correlated, but you have no way to influence what they are.
You get a random number and know instantly what the other random number of the remote particle is, but that doesn't transfer any information from you to the remote location or vice-versa.
The most obvious explanation would have been that there is some kind of hidden state and they don't interact at all anymore, but that doesn't appear to be the case.
The most obvious explanation would have been that there is some kind of hidden state and they don't interact at all anymore, but that doesn't appear to be the case.
[deleted]
There was speculation Starlink could be used for HFT once it gets laser links, but this would even beat that since you don't need to travel up and down an extra 500 miles, plus any buffering in the satellites. Starlink would have more bandwidth, but you probably don't need much for HFT.
Can you listen to the traffic/data on these lines? Is it encrypted (seems unlikely if latency is a must)?
Can you mitm?
Can you mitm?
Ham radio transmissions are not allowed to be encrypted per FAR 97.113(4). [1]
I suspect this is also a violation of FAR 97.113(3) "Communications in which the station licensee or control operator has a pecuniary interest, including communications on behalf of an employer"
[1] https://www.ecfr.gov/cgi-bin/text-idx?SID=d4b3c60d2d60000a14...
I suspect this is also a violation of FAR 97.113(3) "Communications in which the station licensee or control operator has a pecuniary interest, including communications on behalf of an employer"
[1] https://www.ecfr.gov/cgi-bin/text-idx?SID=d4b3c60d2d60000a14...
Do the “part 5 experimental licenses” have that ham encryption restriction? It sounds like that at the very least are exempt from the ham station ID requirements. Are they actually ham operators, or other licensed entities permitted to use the ham bands?
Part 5 is not bound by ham radio rules, you can transmit anything according to certain rules, and if you use the Part 5 rules, you don't care about the rest of the rulebook.
>"It was during this activity that I noticed this massive signal at the top of the 20 meter band, occasionally firing up and clobbering ongoing conversations by U.S. amateurs."
Neat. thanks for the article lmh
Just curious. Does anyone know, what is a 35.295 Mhz used for in the Bay Area (Sunnyvale)?
I'm sure I'm not the only one who would like to see the whole HFT industry be deleted. What a waste of human intellect.
Arbitrage is good actually. Tigher spreads make transactions cheaper and safer for the smaller players.
Just because something has benefit, doesn't mean the benefit outweighs the cost. Specifically we are talking about the opportunity cost of other valuable things these people could be creating. Obviously this can be difficult to measure.
That's not a terribly strong argument. Should we ban making chocolate as well? Sports? Art?
After all, these people could surely be creating something more valuable.
If you want to make an argument based on opportunity cost, it generally should have specific alternatives and a viable cost metric. Without that, it's not an argument, just an opinion.
After all, these people could surely be creating something more valuable.
If you want to make an argument based on opportunity cost, it generally should have specific alternatives and a viable cost metric. Without that, it's not an argument, just an opinion.
the wise man bowed his head solemnly and spoke: "theres actually zero difference between chocolate & HFT. you imbecile. you fucking moron"
the wise man isn't being a good little ancap
The first step is to measure whatever can be easily measured. This is OK as far as it goes. The second step is to disregard that which can't be easily measured or to give it an arbitrary quantitative value. This is artificial and misleading. The third step is to presume that what can't be measured easily really isn't important. This is blindness. The fourth step is to say that what can't be easily measured really doesn't exist. This is suicide.
— Daniel Yankelovich, "Corporate Priorities: A continuing study of the new demands on business" (1972).
You're way off the mark with your examples. More appropriate ones would be military weapons, multi-level marketing, payday loan firms with ridiculous interest rates, scummy advertisement firms. You might not remember that in the Middle-Ages a large portion of intellectuals were spending most of their time debating religion such as is God really omnipotent and what a specific verse in Bible meant.
Now sure you can argue that they were doing only what the society and themselves considered valuable. But one can only wonder if those smart people had been putting their best effort into other things, say developing agriculture or better industrial processes.
I myself did a little day-trading at one period in my life and while I made money, I thought it was the most useless thing I could spend my life in. I was just creating money out of thin air doing basically nothing. Maybe HFT is intellectually more interesting than day-trading but I don't believe it to be very gratifying at deeper level. Perhaps it requires a certain type of person to enjoy that kind of pursuit. I'm definitely not one of those.
Now sure you can argue that they were doing only what the society and themselves considered valuable. But one can only wonder if those smart people had been putting their best effort into other things, say developing agriculture or better industrial processes.
I myself did a little day-trading at one period in my life and while I made money, I thought it was the most useless thing I could spend my life in. I was just creating money out of thin air doing basically nothing. Maybe HFT is intellectually more interesting than day-trading but I don't believe it to be very gratifying at deeper level. Perhaps it requires a certain type of person to enjoy that kind of pursuit. I'm definitely not one of those.
> You're way off the mark with your examples. More appropriate ones would be military weapons, multi-level marketing, payday loan firms with ridiculous interest rates, scummy advertisement firms.
Agreed. Modern economics encourages waste, such as multi-level marketing, payday loans, advertising, etc.
Hell, I'm sure most people's jobs here, indeed, most jobs would fall under David Graeber's "Bullshit Jobs".
> You might not remember that in the Middle-Ages a large portion of intellectuals were spending most of their time debating religion such as is God really omnipotent and what a specific verse in Bible meant. > > Now sure you can argue that they were doing only what the society and themselves considered valuable. But one can only wonder if those smart people had been putting their best effort into other things, say developing agriculture or better industrial processes.
... I cannot agree. A few years ago I picked up Anthony Kenny's "A Brief History of Western Philosophy", and "A New History of Western Philosophy". What these "useless" debates about knowledge got us were considerable changes in morality, metaphysics, and helped us create things that were useful in the long run. Indeed, the only reason formal 'science' is around is because of those changes in thought and reasoning.
Bertrand Russell has another sort of argument in the same direction, that I quite like. You can find it here: https://books.google.no/books?id=CnlbMP_vBmgC&pg=PA16&dq=use...
> I myself did a little day-trading at one period in my life and while I made money, I thought it was the most useless thing I could spend my life in.
Agreed.
Agreed. Modern economics encourages waste, such as multi-level marketing, payday loans, advertising, etc.
Hell, I'm sure most people's jobs here, indeed, most jobs would fall under David Graeber's "Bullshit Jobs".
> You might not remember that in the Middle-Ages a large portion of intellectuals were spending most of their time debating religion such as is God really omnipotent and what a specific verse in Bible meant. > > Now sure you can argue that they were doing only what the society and themselves considered valuable. But one can only wonder if those smart people had been putting their best effort into other things, say developing agriculture or better industrial processes.
... I cannot agree. A few years ago I picked up Anthony Kenny's "A Brief History of Western Philosophy", and "A New History of Western Philosophy". What these "useless" debates about knowledge got us were considerable changes in morality, metaphysics, and helped us create things that were useful in the long run. Indeed, the only reason formal 'science' is around is because of those changes in thought and reasoning.
Bertrand Russell has another sort of argument in the same direction, that I quite like. You can find it here: https://books.google.no/books?id=CnlbMP_vBmgC&pg=PA16&dq=use...
> I myself did a little day-trading at one period in my life and while I made money, I thought it was the most useless thing I could spend my life in.
Agreed.
> Modern economics encourages waste
Correct in one sense, but assumes we know in advance what will be waste and what won't be. Central planning has shown itself to be far less effective, both in overall quality of life and in meeting specific demands, than more wasteful competitive economies. So although its easy to point to retrospectively wasteful activities, life without them would be objectively worse.
Tangentially, when covid was in early days and people were beginning to develop vaccines, I saw someone comment asking who was going to coordinate the many disparate development efforts to make sure resources were being effectively used. I can't think of a more starkly absurd idea - it's only by allowing free activity, incentivized by some external, real forcing function, that we can expect to see consistent success. Any central definition and sanction of what should and shouldn't be done instantly distorts incentives towards pleading some central arbiter, and fails.
So all the scuzzy businesses and pursuits that the GP thinks are wasteful, are part of the rich tapestry that overall feeds us and keeps lifting us up. The only way we'd should be signaling they are not helpful is by not using them (and just for greater certainty I'm not talking about tolerating things that are exploitive, harmful, etc, just "wastful")
Correct in one sense, but assumes we know in advance what will be waste and what won't be. Central planning has shown itself to be far less effective, both in overall quality of life and in meeting specific demands, than more wasteful competitive economies. So although its easy to point to retrospectively wasteful activities, life without them would be objectively worse.
Tangentially, when covid was in early days and people were beginning to develop vaccines, I saw someone comment asking who was going to coordinate the many disparate development efforts to make sure resources were being effectively used. I can't think of a more starkly absurd idea - it's only by allowing free activity, incentivized by some external, real forcing function, that we can expect to see consistent success. Any central definition and sanction of what should and shouldn't be done instantly distorts incentives towards pleading some central arbiter, and fails.
So all the scuzzy businesses and pursuits that the GP thinks are wasteful, are part of the rich tapestry that overall feeds us and keeps lifting us up. The only way we'd should be signaling they are not helpful is by not using them (and just for greater certainty I'm not talking about tolerating things that are exploitive, harmful, etc, just "wastful")
>in the Middle-Ages a large portion of intellectuals were spending most of their time debating religion such as is God really omnipotent and what a specific verse in Bible meant.
Right. And through all that thinking about silly stuff, people eventually came to the idea that a LOT of this religion stuff is silly and not worth wasting time on, so smart people could skip worrying about it for the rest of human existence if they chose to. (Whereas beforehand, it was considered a super-important thing to think about).
You seem to imply all this effort was a waste but ultimately it led to the Reformation, various Renaissance periods and, most importantly, Douglas Adams.
I suspect that the same thing will happen with HFT. Either people will stop bothering with it eventually, or they will discover some fantastic new quantum effects that pay dividends for humanity forever more. :)
Right. And through all that thinking about silly stuff, people eventually came to the idea that a LOT of this religion stuff is silly and not worth wasting time on, so smart people could skip worrying about it for the rest of human existence if they chose to. (Whereas beforehand, it was considered a super-important thing to think about).
You seem to imply all this effort was a waste but ultimately it led to the Reformation, various Renaissance periods and, most importantly, Douglas Adams.
I suspect that the same thing will happen with HFT. Either people will stop bothering with it eventually, or they will discover some fantastic new quantum effects that pay dividends for humanity forever more. :)
>and, most importantly, Douglas Adams.
Brilliant!
What a loss he was, died too young.
Brilliant!
What a loss he was, died too young.
Funny that you mention Renaissance, which happens to be the name of one of the major HFT firms, Renaissance Technologies
Funny that you mention Douglas Adams. I am confident HFTers would be on Ark B.
> You might not remember that in the Middle-Ages a large portion of intellectuals were spending most of their time debating religion such as is God really omnipotent and what a specific verse in Bible meant.
And that lead to establishing a whole new field of social sciences that is philosophy. Yes, i am aware that middle-age debates and musings like that were not solely responsible for philosophy as a field of study, we gotta remember eastern philosophers and others too, but they were still monumental to making philosophy what it is today.
Regardless of how much their musings on god contributed to creating philosophy as we know it today in comparison to efforts of others working in that field (e.g., eastern philosophers in old China or middle eastern philosophers of about the same time period), their efforts accomplished a lot in terms of generating actual value for the society through philosophy as a field of study. Unless you are dismissing the entire field of philosophy as it stands today as "useless", then the value of those discussions is pretty obvious.
Not even mentioning second-order effects, like those debates making people question prior assumptions and embarking on important scientific endeavors, like trying to prove that Earth might be indeed revolving around the sun and not the other way around.
And that lead to establishing a whole new field of social sciences that is philosophy. Yes, i am aware that middle-age debates and musings like that were not solely responsible for philosophy as a field of study, we gotta remember eastern philosophers and others too, but they were still monumental to making philosophy what it is today.
Regardless of how much their musings on god contributed to creating philosophy as we know it today in comparison to efforts of others working in that field (e.g., eastern philosophers in old China or middle eastern philosophers of about the same time period), their efforts accomplished a lot in terms of generating actual value for the society through philosophy as a field of study. Unless you are dismissing the entire field of philosophy as it stands today as "useless", then the value of those discussions is pretty obvious.
Not even mentioning second-order effects, like those debates making people question prior assumptions and embarking on important scientific endeavors, like trying to prove that Earth might be indeed revolving around the sun and not the other way around.
Philosophy is much older than middle age religious debates.
Absolutely agreed, it goes at least as far (if not further) as ancient Greece.
Just wanted to highlight that specific time period, since it was pointed out by the parent comment as a specific example of those efforts going nowhere.
Just wanted to highlight that specific time period, since it was pointed out by the parent comment as a specific example of those efforts going nowhere.
Debating religion is far from useless - these discussions are what ultimately helped us shape a coherent foundation for philosophy and science.
Most systems are pretty inefficient and the problem is at the time we do not know which pursuits will yield the most valuable results.
Top-down, authoritarian direction of intellectual pursuit tends to yield worse outcomes than just letting people do as they wish. It's dangerous to suggest that any single perspective can accurately decide value.
Most systems are pretty inefficient and the problem is at the time we do not know which pursuits will yield the most valuable results.
Top-down, authoritarian direction of intellectual pursuit tends to yield worse outcomes than just letting people do as they wish. It's dangerous to suggest that any single perspective can accurately decide value.
> Maybe HFT is intellectually more interesting than day-trading but I don't believe it to be very gratifying at deeper level.
HFT is automated day-trading in a way, so 1 meta level more intellectually interesting I suppose.
HFT is automated day-trading in a way, so 1 meta level more intellectually interesting I suppose.
One of my friends made this argument. He was working in ad tech.
Actually, I somewhat agree with you. In the interest of time, I had to just stop at "Obviously, this can be difficult to measure". I find this allocation of resources problem very interesting, but I don't claim to know the answer. You can even flip it around the other way and say "Actually there really isn't anything more valuable they could be doing." It sure seems however there is a ton of brain power being used for things that would benefit society more elsewhere, but who knows.
People aren't complaining about arbitrage, they're complaining about microsecond-level timing optimizations. The same benefits to smaller players could be obtained from trading at a human time scale (e.g. something around professional StarCraft player actions per minute).
Arbitrage is fine. This amount of arbitrage, and the subsequent fighting over microseconds from the exchange, is completely fucking dumb, and I want to live in a world where there is zero money in it.
Arbitrage is good, sure. But what is the timescale that is useful? Is sub-second resolution of arbitrage actually useful?
What is the argument against Arbitrage having a lag of even, say, 90 seconds?
And like... who cares about the price delta on a time scale even less than an hour apart from day traders? FX stuff I guess?
What is the argument against Arbitrage having a lag of even, say, 90 seconds?
And like... who cares about the price delta on a time scale even less than an hour apart from day traders? FX stuff I guess?
Saving one microsecond is rewarded the same as saving one millisecond, as long as you beat out the next best guy. There are vast diminishing returns to society but the winner is still rewarded the same so incentivized to make it faster and faster, ultimately burning away energy and misallocating capital until the reward is exhausted, and then repeating each time a new generation of hardware is out.
Not quite, you're forgetting the T in HFT. If everyone was just buying securities a microsecond vs a millisecond might not matter much. What happens is a lot of HFTs act as market makers. They arbitrage positions they create which screws over any non-HFTs. It also moves the price of securities for no reason which affects everyone holding that security. There's also been plenty of cases of HFTs doing front-running and spoofing.
The effects of HFTs aren't limited to HFT vs traditional traders. Their artificial arbitrage affects people's retirement funds and the like. It wouldn't be so bad if they were just making money off other traders but instead they're making money off everyone with money in the markets.
The effects of HFTs aren't limited to HFT vs traditional traders. Their artificial arbitrage affects people's retirement funds and the like. It wouldn't be so bad if they were just making money off other traders but instead they're making money off everyone with money in the markets.
> It also moves the price of securities for no reason which affects everyone holding that security.
Huh? It's narrowing bid-ask spreads, which is beneficial to other market actors. There's nothing "artificial" in it other than betting that the price fundamentals won't move against them, like any other market maker.
Huh? It's narrowing bid-ask spreads, which is beneficial to other market actors. There's nothing "artificial" in it other than betting that the price fundamentals won't move against them, like any other market maker.
> screws over any non-HFT
Not true. The HFTs are often market makers and are PAID to be in the market by the exchanges at all times so that others have something to trade.
Not true. The HFTs are often market makers and are PAID to be in the market by the exchanges at all times so that others have something to trade.
I should clarify I'm referring to pure latency arbitrage stuff and not all HFT.
This was actually visible on some cryptocurrency exchanges, where the EURUSD exchange rate differed significantly (>5%) from the regular market exchange rate.
I believe that arbitrage within the platform kept the prices and exchange rates consistent (i.e. it didn't matter whether you bought Bitcoin for EUR or first changed the EUR to USD then used that to buy Bitcoin), but of course you could make/lose some money by exchanging EUR <--> USD on the platform then exchanging it back outside (or simply exchanging it on the platform, waiting until arbitragers brought the exchange rate back to normal levels, then exchanging it back).
But in effect, the lack of efficient arbitrage between the platform and the "real world" that allowed EURUSD rates to drift so far meant that how much your coins were worth depended on what currency you bought/sold them for, making the whole thing highly annoying.
The cryptocurrency markets, which seem less mature/complicated/HFT-overrun than the "big" markets, are great for learning market principles.
I believe that arbitrage within the platform kept the prices and exchange rates consistent (i.e. it didn't matter whether you bought Bitcoin for EUR or first changed the EUR to USD then used that to buy Bitcoin), but of course you could make/lose some money by exchanging EUR <--> USD on the platform then exchanging it back outside (or simply exchanging it on the platform, waiting until arbitragers brought the exchange rate back to normal levels, then exchanging it back).
But in effect, the lack of efficient arbitrage between the platform and the "real world" that allowed EURUSD rates to drift so far meant that how much your coins were worth depended on what currency you bought/sold them for, making the whole thing highly annoying.
The cryptocurrency markets, which seem less mature/complicated/HFT-overrun than the "big" markets, are great for learning market principles.
Can we quantify how much advantage we get as retail investors? And how does it compare to the billions spent on dedicated networking, radio gimmickry, and specialized hardware and software magic, plus the opportunity cost of pulling all that talent and capacity from other industries?
If every trade settled at, say, the rolling average price of the last 60 seconds-- or 60 minutes-- it would dramatically quiet the "noise" in the market. There would still be enough demand from conventional investors, and the averaging policy could actually stabilize the riskiest scenarios (i. e. a temporary loss of market makers causing orders to settle at comically out-of-bound prices)
If every trade settled at, say, the rolling average price of the last 60 seconds-- or 60 minutes-- it would dramatically quiet the "noise" in the market. There would still be enough demand from conventional investors, and the averaging policy could actually stabilize the riskiest scenarios (i. e. a temporary loss of market makers causing orders to settle at comically out-of-bound prices)
High speed trading is an effective route to achieve that policy as it reduces the need to keep resources tied up in market making, an activity that requires compensation.
Any other method to force a uniform price, i.e. a price that cannot quickly change in response to information, creates arbitrage opportunities that are greatly unfavorable to retail investors.
Any other method to force a uniform price, i.e. a price that cannot quickly change in response to information, creates arbitrage opportunities that are greatly unfavorable to retail investors.
Arbitrage does not require HFT. The concept is centuries old dating from when information flowed by horse.
This presumes that the stock market, and capitalism itself, are both a net good. Not everyone would agree with that.
yeah, i've heard that exact excuse repeated all the time on reddit, too.
At least arbitrage provides some value by tightening bid/ask spreads. What about all the smart nerds who work on adtech instead of important problems? That's entirely irredeemable.
An awful lot of the web would go offline without that revenue.
Targeted advertising seems to benefit everyone compared to untargeted advertising?
My google ads are mostly saas software and tech gadgets, which I prefer over random ads.
If a lip gloss company wanted to advertise, is it not better that they can target people who like lip gloss instead of a random audience?
My google ads are mostly saas software and tech gadgets, which I prefer over random ads.
If a lip gloss company wanted to advertise, is it not better that they can target people who like lip gloss instead of a random audience?
The cost of targeted ads, as they are currently implemented, is privacy. The juice ain’t worth the squeeze.
I’ve spent some time working in electronic trading, and I agree with you. Not only is the compensation very comfortable, but it’s the most interesting work I’ve ever done. That’s a tough combination to resist.
As a result, it attracts people who should be out there curing cancer, developing new technologies, researching fundamental sciences, and so forth. It’s something everyone around me has acknowledged at one point or another.
And yes, there is real benefit to providing liquidity. And yes (to another poster) exchanges love them some sweet, sweet algorithmic trader action.
IMHO this is a “bug” in capitalism that can’t be edited out by tweaking a line or two. I don’t know what the right answer is.
As a result, it attracts people who should be out there curing cancer, developing new technologies, researching fundamental sciences, and so forth. It’s something everyone around me has acknowledged at one point or another.
And yes, there is real benefit to providing liquidity. And yes (to another poster) exchanges love them some sweet, sweet algorithmic trader action.
IMHO this is a “bug” in capitalism that can’t be edited out by tweaking a line or two. I don’t know what the right answer is.
This is more complicated than it seems. You are comparing a job (HFT) with a pursuit (science). The actual comparison is HFT with academia (the job part). Academia is a terrible job and getting worse over time. Academics have been talking about how the job is bad and getting worse for 100 years. There is a long list of problems. Working in science is also an exercise of joining a community where your peers seem willing to put up with the terrible working conditions, almost to the point of masochism or martyrdom.
The other issue is that intelligent people tend to feel entitled to success, particularly if they succeed on traditional measures which rank them according to others. This makes them less likely to enter very difficult and uncertain fields when there are other options. Science is often inhumane in a sense, you can waste your life on the wrong idea, certainly many people have. You can also be right, but only proven so after you die.
Science also has developed a large swarm capacity, which reduces the ability of an individual to succeed and make an impact. The best example is deep learning... the explosion in deep learning research output is frankly astonishing. In real terms, a lot of researchers outside the field managed to drop whatever they were doing at the time and switch to deep learning research. Along with the excellent tooling, accessible hardware and data and low barrier to publication, there is literally a flood of papers. It is now very difficult to get noticed, and much harder to make any progress. This has happened in the space of one PhD duration. It is reasonable to assume this will keep happening as new fields open up. I presume it is because there are large numbers of people waiting for the next big thing, underemployed or underutilised in their own current work. In this scheme, research success comes to either those that found a field (even more difficult and unlikely) or have the best resources (often corporate research these days). Your talent, intelligence etc all become secondary. You can say that this is just 'rapid progress' and good for humanity. Maybe. There is also a lot of low quality work. But in the end one is an individual, not humanity, and you need to act on that basis.
All these factors conspire to send smart people away from science, and it is hard to blame them.
The other issue is that intelligent people tend to feel entitled to success, particularly if they succeed on traditional measures which rank them according to others. This makes them less likely to enter very difficult and uncertain fields when there are other options. Science is often inhumane in a sense, you can waste your life on the wrong idea, certainly many people have. You can also be right, but only proven so after you die.
Science also has developed a large swarm capacity, which reduces the ability of an individual to succeed and make an impact. The best example is deep learning... the explosion in deep learning research output is frankly astonishing. In real terms, a lot of researchers outside the field managed to drop whatever they were doing at the time and switch to deep learning research. Along with the excellent tooling, accessible hardware and data and low barrier to publication, there is literally a flood of papers. It is now very difficult to get noticed, and much harder to make any progress. This has happened in the space of one PhD duration. It is reasonable to assume this will keep happening as new fields open up. I presume it is because there are large numbers of people waiting for the next big thing, underemployed or underutilised in their own current work. In this scheme, research success comes to either those that found a field (even more difficult and unlikely) or have the best resources (often corporate research these days). Your talent, intelligence etc all become secondary. You can say that this is just 'rapid progress' and good for humanity. Maybe. There is also a lot of low quality work. But in the end one is an individual, not humanity, and you need to act on that basis.
All these factors conspire to send smart people away from science, and it is hard to blame them.
>> Science is often inhumane in a sense, you can waste your life on the wrong idea, certainly many people have. You can also be right, but only proven so after you die.
I’m no scientist, but the above really resonated with me.
I’m no scientist, but the above really resonated with me.
Yep. Some of the brightest minds in the world, including many of my friends, are wasted figuring out how to make more money from online clicks.
Conversely: science pays junk money compared to IT. I have a Masters in chemistry, my wife has a Ph D. I make more then twice what she does off of skills I taught myself, and when I'm between work recruiters call me.
If we want more people in the sciences, we've got to create the jobs.
If we want more people in the sciences, we've got to create the jobs.
That's what my chemistry teacher told us in high school. If you want to really 'make it' in chemistry you better be insanely good, which is has a small probability. Otherwise you sorta end up as a lab technician.
Made me choose the other thing I loved in high school which was math and computer science.
Haven't looked back.
Made me choose the other thing I loved in high school which was math and computer science.
Haven't looked back.
Once you have enough liquidity that the markets function (i.e. the stuff of actual value to people doesn't get jammed up) it seem the marginal utility of adding liquidity is near zero.
Have I missed something?
Have I missed something?
capital deteriorates and becomes obsolete so executives are constantly maintaining and optimizing their businesses as they respond to market conditions. These trades are how the market chooses who is better and worse at this constant maintenance/optimization. unfortunately capital isn't something you can set up and allow to run indefinitely.
I’m pretty sure it can be allowed to run unattended for several milliseconds at least.
it can but this is "late" capitalism, we are at a point where capital that updated every year was outcompeted by capital that updated every quarter, which was outcompeted by capital that updated every month, and so on. Each time this happened there were efficiency gains that required everyone to keep up or go out of business, and the efficiency gains resulted in surpluses that were allocated somewhere in the economy. If we turned back the clock then these businesses would become less efficient and we would have to sink more resources into them to continue the same output.
Iterative optimization resulted in smaller and smaller (and more frequent) corrections.
Iterative optimization resulted in smaller and smaller (and more frequent) corrections.
I see where you are going here, but it seems to be many orders off magnitude off in time relative to HFT.
its highly counterintuitive to see the modern system in the same terms as the capital markets of last millennium. and I'm convinced the system isn't perfect, I'm sure there are things that should be changed. I'm merely suggesting that the market sped up as people learned to do market stuff faster, and that market stuff is ultimately a process of allocating capital resources.
Ok, I get that - I don't think it really addresses my concern/question about whether or not this is far in the range of diminishing utility.
Put it another way, if the number of HFT trades were suddenly cut in half, what 1st order impacts would be felt by people outside those markets? The heart of the "but we're providing liquidity" argument is that this is a service provided that has real value outside the market. If that's not true the particular argument falls apart, doesn't it?
Put it another way, if the number of HFT trades were suddenly cut in half, what 1st order impacts would be felt by people outside those markets? The heart of the "but we're providing liquidity" argument is that this is a service provided that has real value outside the market. If that's not true the particular argument falls apart, doesn't it?
> far in the range of diminishing utility.
it probably is because of distortions in the flow of money
> Put it another way, if the number of HFT trades were suddenly cut in half, what 1st order impacts would be felt by people outside those markets?
it would probably result in capital markets taking longer to account for changes in the market/world such as shortages. Then the capital markets that weren't subject to the restriction would be more competitive as a whole. Depending on the specifics, it might open the door to people with relevant information (who weren't hf traders) to begin to make some of those trades.
> The heart of the "but we're providing liquidity" argument is that this is a service provided that has real value outside the market. If that's not true the particular argument falls apart, doesn't it?
I don't use the liquidity form of the argument because I think it focuses on the wrong things. Capital markets affect the rest of the markets by optimizing the creation and maintenance of capital. All consumer goods rely on capital. So policies that make the capital markets less efficient would have broad downstream effect in commodities markets, essentially there would be in aggregate fewer goods.
it probably is because of distortions in the flow of money
> Put it another way, if the number of HFT trades were suddenly cut in half, what 1st order impacts would be felt by people outside those markets?
it would probably result in capital markets taking longer to account for changes in the market/world such as shortages. Then the capital markets that weren't subject to the restriction would be more competitive as a whole. Depending on the specifics, it might open the door to people with relevant information (who weren't hf traders) to begin to make some of those trades.
> The heart of the "but we're providing liquidity" argument is that this is a service provided that has real value outside the market. If that's not true the particular argument falls apart, doesn't it?
I don't use the liquidity form of the argument because I think it focuses on the wrong things. Capital markets affect the rest of the markets by optimizing the creation and maintenance of capital. All consumer goods rely on capital. So policies that make the capital markets less efficient would have broad downstream effect in commodities markets, essentially there would be in aggregate fewer goods.
I haven’t seen any claims that HFT is allocating capital in better directions. They’re mostly reacting to the same signal and trying to trade the same asset at the same price, right? That’s the only case where the latency matters, because the market uses order time to break ties.
the market allocates better, the hot allocates faster. the information (prices) is better because its more current.
>As a result, it attracts people who should be out there curing cancer, developing new technologies, researching fundamental sciences, and so forth.
I'm in HFT, and I'm confident in speaking not only for myself when I say that if HFT didn't exist I'd be doing something else fun and profitable (e.g. investment banking, non-high-frequency trading), not something boring and/or poorly compensated like medical research. People on this site have no right to tell other people how to live their lives, especially when they themselves probably work on something like ad-tech which is arguably actively very harmful to democracy and society.
I'm in HFT, and I'm confident in speaking not only for myself when I say that if HFT didn't exist I'd be doing something else fun and profitable (e.g. investment banking, non-high-frequency trading), not something boring and/or poorly compensated like medical research. People on this site have no right to tell other people how to live their lives, especially when they themselves probably work on something like ad-tech which is arguably actively very harmful to democracy and society.
I like that term "“bug” in capitalism". I have always felt the "bug" is basically incorrectly pricing externalities. We don't properly charge you for the carbon you put into the atmosphere or the mental health strain you put on workers and so on. If societal costs were also real costs the allocation of resources could be more optimized.
It's an interesting of reasoning but comes with a caveat - Reducing externalities to a price figure allows you to trade them away on a balance sheet as nothing more than a price figure. This is fine if pricing accurately reflects value, but that's not the same as allowing a market to set the price. You lose a huge amount of detail in the process that can't simply be captured in a price signal moving up or down.
You may end up with things that have infinite price, at which point I think we're begging the question.
There's also a question of how commodified the things we're talking about here can actually be - If you can sell it one day and it's impossible to 'buy back' tomorrow at any price, then it's a fundamentally different kind of trade that doesn't really fit the framework as neatly as first appears.
You may end up with things that have infinite price, at which point I think we're begging the question.
There's also a question of how commodified the things we're talking about here can actually be - If you can sell it one day and it's impossible to 'buy back' tomorrow at any price, then it's a fundamentally different kind of trade that doesn't really fit the framework as neatly as first appears.
Without pricing the externalities, we're basically taking on debt, a debt against the future number of years the planet is habitable. I imagine it probably started at 1M years of supporting human life. I wonder if that number is now down to 50000 left. And I feel like it went from 1M to 50K in the last 50 years.
Indeed, it seems the longer we run under the status quo the greater the cost in externalities, to the point we’re beginning to understand represents an existential threat globally.
However we also risk a self-fulfilling prophecy if we commodify those externalities and reduce them to lines on a balance sheet. I know that this is not quite what’s being argued for, but I am equally certain that is how it would land in practice.
I’m not convinced re-framing/codifying our social, environmental, and human capitals as financial instruments is any kind of progress towards salvation, rather it’s a doomed attempt to take everything that never fit inside the tidy box of capitalism and cram it inside of the box anyway. A try at making the world comprehensible to a mind accustomed to that manner of framing.
This problem needs novel thinking, more novel than finding a direct way to account for it within the existing framework. I regrettably don’t have a better idea.
However we also risk a self-fulfilling prophecy if we commodify those externalities and reduce them to lines on a balance sheet. I know that this is not quite what’s being argued for, but I am equally certain that is how it would land in practice.
I’m not convinced re-framing/codifying our social, environmental, and human capitals as financial instruments is any kind of progress towards salvation, rather it’s a doomed attempt to take everything that never fit inside the tidy box of capitalism and cram it inside of the box anyway. A try at making the world comprehensible to a mind accustomed to that manner of framing.
This problem needs novel thinking, more novel than finding a direct way to account for it within the existing framework. I regrettably don’t have a better idea.
Which social costs? Is it a social cost having too few kids? Or too many kids? Should we price that in? And what’s the cost we should price in? Who decides? Can we all agree on one price?
For sure. There needs to be a cost charged by the exchanges (federally required) which decreases with time.
Nearly every symbol traded on exchanges trades with “price/time” priority meaning that the order that rests the longest at a price fills first. This provides a very big incentive to keep orders on exchanges for a long time.
The only time there is a speed race in these symbols to _place_ an order is when they are filling in a missing level. That is providing quotes at better prices. Why would you want to make that more expensive?
The only time there is a speed race in these symbols to _place_ an order is when they are filling in a missing level. That is providing quotes at better prices. Why would you want to make that more expensive?
What about race cars and the insane amount of money spent improving them? There is no social benefit in the sense you are talking.
What about the advertising industry, making up slogans and jingles that you can't get out of your head?
I think you might misunderstand the mechanisms behind the stock market and thus the value provided by the HFT industry.
What about the advertising industry, making up slogans and jingles that you can't get out of your head?
I think you might misunderstand the mechanisms behind the stock market and thus the value provided by the HFT industry.
Correct, the ad industry also deserves to be mostly killed
not saying that every industry should have a social benefit. Just that HFT is uniquely and excessively terrible and pointless and should die.
I think you are assuming that anyone who criticizes HFT must be clueless about how finance works because you can't imagine any other reason they would criticize it. Look around, that's not true.
I think you are assuming that anyone who criticizes HFT must be clueless about how finance works because you can't imagine any other reason they would criticize it. Look around, that's not true.
His leap to a conclusion, "this is HFT in Chicago" seems overly precise. Sure, it is a great hypothesis, but not much supplementary evidence.
The context here is that there are already speculations and some indirect evidence about High-Frequency Traders on the High Frequency band for years (e.g. see [0] from 2018), which made it a naturally candidate. I'm not saying that it's proved, but a candidate worth investigating.
[0] Shortwave Trading | Part I | The West Chicago Tower Mystery
https://sniperinmahwah.wordpress.com/2018/05/07/shortwave-tr...
[1] SHORTWAVE TRADING | PART II | FAQ AND OTHER CHICAGO AREA SITES
https://sniperinmahwah.wordpress.com/2018/06/07/shortwave-tr...
[2] Shortwave Trading | Part III | Fourth Chicago Site, East Coast, Patent, Regulation, and Farmer Kevin Mystery
https://sniperinmahwah.wordpress.com/2018/07/13/shortwave-tr...
[0] Shortwave Trading | Part I | The West Chicago Tower Mystery
https://sniperinmahwah.wordpress.com/2018/05/07/shortwave-tr...
[1] SHORTWAVE TRADING | PART II | FAQ AND OTHER CHICAGO AREA SITES
https://sniperinmahwah.wordpress.com/2018/06/07/shortwave-tr...
[2] Shortwave Trading | Part III | Fourth Chicago Site, East Coast, Patent, Regulation, and Farmer Kevin Mystery
https://sniperinmahwah.wordpress.com/2018/07/13/shortwave-tr...
Using the update from the bottom of the page:
> … and M-Wave is authorized the 14-14.99 MHz at 16 kW.
I found this petition from M-Wave Networks, LLC for permission to build 4 towers in Kane County, Illinois: https://www.countyofkane.org/FDER/Zoning%20Petitions%20Docum...
The location in the petition is approx. 41.82907908782928, -88.4940281199101, which is about 16 miles (27 km) from the center coordinate of the TDOA map (41.60, -88.60). Not bad given the caveat of "the above location is likely accurate to only a few 10s of km at best."
The e-mail address in the petition has the domain tower-research.com, which is a high-frequency trading firm.
The only thing I'm confused about is that the zoning petition was discussed at the meeting on Dec 8th 2020. If it was approved, it seems remarkably fast to build a tower given that the article was from Dec 15th.