Global financial regulators urge caution over rise of robots – FT

Does this represent the ultimate in the “tight coupling” risk management problem (e.g., Feynman’s view of the Challenger disaster, Rick Bookstaber’s take on financial meltdowns, etc.)?

“Applications of AI and machine learning could result in new and unexpected forms of inter-connectedness between financial markets and institutions, for instance based on the use by various institutions of previously unrelated data sources,” said the FSB, in its first dedicated report on AI.

via Global financial regulators urge caution over rise of robots

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Financial Explosive Devices Throughout the Warp and Woof of the Global Financial System – David Stockman

Interesting piece by Reagan OMB Director turned econoclast (bit awkward but I like it) David Stockman, on the failure of the Fed’s effort to boost the real economy beyond where it was before the financial crisis, while embedding risks throughout it.

The mad scramble for yield among money managers induced by nine years of massive financial repression has implanted financial explosive devices (FEDs) throughout the warp and woof of the global financial system. The systematic falsification of financial asset prices has literally touched off a chain reaction of speculation and irrational exuberance that is plenary and embedded in nooks and crannies everywhere.

via Contra Corner » Good Job, Fed! Monetary Stimulus And The 0.0001%

Even Philip Marlowe’s Anterior Insula Was Hard Boiled

“She hung up and I set out the chess board. I filled a pipe, paraded the chessmen and inspected them for French shaves and loose buttons, and played a championship tournament game between Gortchakoff and Meninkin, seventy-two moves to a draw, a prize specimen of the irresistible force meeting the immovable object, a battle without armor, a war without blood, and as elaborate a waste of human intelligence as you could find anywhere outside an advertising agency.”

– Raymond Chandler, The Long Goodbye

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When capitalism wants to data mine you | FT Alphaville

Interesting point in an FT article today: If Big Data is seen by companies and investors as an asset, one reflected in valuations, regulations on its use, like the one in Europe kicking in next year, could have a big bottom-line impact on company financials and share prices. Alphaville does a read-across from oil – if the government were to regulate it more dramatically, what would happen, etc. Not an entirely airtight argument, but a conversation starter.

via When capitalism wants to data mine you | FT Alphaville