81–90 of 98 posts
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The way your comment is written, I thought someone literally had their sandwich angrily thrown across the room when Knight collapsed.
I was also under that impression until I came across your comment. I guess everyone got his lunch that day.
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There are N^2 sets of rules. At the end of the day you have two counterparties engaged in voluntary exchange. Everything is negotiable, anything is possible -- you just have to ask or pay. What people don't seem to grasp about modern finance is how mind boggingly complex and dynamic it really is. The idea that a tier one investment bank and a small trader should be held to the same "rules" is so wondrously silly... i…
>The idea that a tier one investment bank and a small trader should be held to the same "rules" is so wondrously silly... it's hard to describe but there ought to be a word for it. Just like the idea that the aristocracy should be accountable to the same laws as commoners, right?
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After it passes review and all stages of testing it's everyone's bug.
Exactly. You don't just do code reviews and run tests to catch bugs. You also do code reviews and run tests so that, when something does slip through, it's no one person's fault.
Makes total sense. It's almost as if everyone at a company should be on the same team :)
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....what? Your logic is truly frightening. Are you saying this is a regularly occurring event and that they deliberately did this? Do you have any idea of the scale and complexity and risk of the code they have deployed? This shit understandably happens. There is no "more people means mistakes don't happen" in any organization on the planet. There is no "whether or not who should morally be able to roll back a trade"…
>we do a lot of business together and I make you a lot of money >Other banks are watching and there are plenty of other exchanges to do business with And the answer to that should be "sorry, if we will roll back your trade, SEC will put us out of business on the fraud charges".
How do I get a job in this field?
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The fact that this is even a thing is the problem. Is this industry creating anything of actual value or is this just a giant MMORPG where the object is to grind long enough to get a house in the Hamptons?
Yes. HFT in particular creates liquidity for other trades in the market.
In particular, since one of the objects is to grind long enough that the rules of the game don't apply to you, see 'Goldman Sachs', I think the original poster's criticism is valid.
There is no referee. The only goal is to give game winners more money, and if they screw up, give them their money back and then give them more money. It justifies things like investments in index funds (or identifying those who are already competing outside the rules and rewarding them by investing more money in them since they cannot fail), but it's gone well beyond the rational functioning of a system, much less a self-regulating system with useful purposes.
It's Calvinball. Go ahead and enjoy it, but it's not right.
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I love this. This is the ultimate wisdom of crowds hack. Have a thousand people throw in a thousand bucks, each one selects an option play to purchase. Randomly select the purchase. If the play is profitable, keep the money. if it's a loss get the trade reverted because 'a lot of people were involved in the process.' I can make the process as convoluted an necessary to meet your 'no one person you can lay blame on' r…
That pretty clearly wouldn't work. A necessary (but not sufficient) condition for breaking a trade typically involves language like "clearly erroneous". Selling an option that is trading in the $100s for $1 (the case here) is probably in this class; trading at the market and then having it move against you is completely different.
Are stock market players not allowed to divest extremely suddenly, to dump their property at fire sale prices in order to get rid of it at what would be a paper loss, all the while knowing the consequences of holding would be worse?
What if they're dumping equity in a company that will be known to have committed terrorist acts? I'm not sure if I buy 'clearly erroneous'. I also don't buy that the scale of the error was really threatening to Goldman Sachs.