Spiders, or: a reasonable facsimile of reality

I’m told algorithmic trading spiders

inhabit the market information web

waiting for a juicy meal

to feast upon while thousands

of trades are executed in a blink

by the ‘bots which cannot discern

between logical & illogical

market falls. I’m told

situational algorithms work

on assimilating different types

of data, events & information

to produce a profitable trading

strategy that includes High

Frequency Trading working

on creating numerous high speed

transactions to exploit situations

where the price of something

in one market is out of step

with another. I’m told

algorithmic trading happens

at such speed it soaks up

the liquidity in the system

meaning ridiculously priced

orders of 0.0001 cents are

executed before humans

can react. I’m told

Thursday’s Flash Crash

was most likely a trader missing

a decimal point or adding some

zeros in executing an order. I’m

told the jittery market

accepted the fall as being

a reasonable facsimile of reality

speaking volumes about how

market volatility is now a given

if not loved norm. I’m told

the NYSE stepped in

to turn off the computers

ordering brokers to broke

directly with one another

allowing human judgement. I’m

told this is a reasonable facsimile

of reality & human judgement.

[Note: this poem uses words found in the article ‘News chaos theory misses the point’ by Ian McIIWraith on pp. 1-2 of the Weekend Business section of the Sydney Morning Herald on 8-9/5/2010. The graphic was found at the  Radical Graphics website.]

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~ by Peter Lach-Newinsky on May 9, 2010.

4 Responses to “Spiders, or: a reasonable facsimile of reality”

  1. I really like this and the picture is nice.

  2. Excellent poem about a current topic…wonder who made the most money during that event…want to find the real problme…follow the money….thanks for this post.

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