How come we have not learned anything from WarGames or The Terminator? We continue to attempt to automate systems that should be controlled by critical thinking. How is it we've allowed out financial markets to be controlled by machines. Machines running buggy, unreliable code?
Recently two Norwegian day traders were convicted of market manipulation for exploiting flaws in the algorithms of the Timber Hill trading system. The pair were able to predict how the prices of stocks and commodities traded by the system would react to engineered trades the pair made.
Norwegian Day Traders Convicted For Manipulating Computer Trading System
While the sentencing for the two wasn't harsh, it still seems unfair compared to the charges brought against Timber Hill. By that I mean the absence of charges against Timber Hill. Just as with the "flash crash" of the US market earlier this year, nothing is being done to the people responsible creating the real problem.
If the stocks and commodities were material items and these automated trading systems caused physical damage, say like a defective vehicle, the regulators and politicians would be all over the creators of these systems. Unfortunately though nothing happens to the creators, even though their systems can do considerably more damage than a defective vehicle and have far reaching repercussions.
Does putting a computer in charge of our nuclear arsenal seem wise? No, we know this already. Does putting a bunch of computers controlled by software written by "God knows who" and tested minimally in charge of the trading of world markets seem wise? If answered yes, I have a classic Ford Pinto you may be interested in purchasing.