Computers are now in Control

Algorithms Take Control of Wall Street | WIRED Magazine

Money Machine Labyrinth

The machines are now making decisions. Algorithmic Trading is now responsible for 70% of the activity on Wallstreet. A system that is more efficient, faster and smarter than any human.

Legions of powerful, superfast trading algorithms – simple instructions that interact to create a market that is incomprehenisble to the human mind and impossible to predict.

‘Advanced Execution Services’ (of e.g. Credit Suisse) try to conceal massive orders using Algorithmic Trading, while other traders use code to detect them (called ‘Predatory Trading’).

The system has outgrown the humans that created it.

Our financial markets have become a largely automated adaptive dynamical system with feedback. We may be able to slow it down, but we can never contain, control, or comprehend it.

It’s the machines’ market now; we just trade in it.

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