Gary Gensler is getting curb stomped in the courts for taking the agency in fruitless directions that will never achieve investor protection even if they won in the courts, investor protection being Congress' mission for the SEC, and so he is pivoting on what he wants to focus on and be remembered for by making up a new area to protect investors. It isn't supposed to make sense, it is purely self preservation.
Not an expert, so posing a few questions in response to the article:
- Barring market microstructure considerations altogether, aren't there human-engineered failsafes in place to prevent market selloffs? Most recent and salient example that comes to my mind: circuit breakers during the multiple day sell-off on news that COVID was indeed serious.
- Additionally, weren't most fears re. algorithmic trading in the US equity space addressed in the early 2010s?
- We saw Zillow (using Facebook's Prophet), Redfin, and Opendoor apply algorithmic trading to homes. Did they really have an outsized effect on housing liquidity? A superficial look at the numbers tells me that on paper, wealth was redistributed from their pockets.
It looks like Goldman Sachs gave him the wrong notes to read from. Or maybe, GS is readying to make a massive investment in AI companies and they need their valuation to come down so that they get a better price?
What about inept political infighting leading to downgraded ratings or a debt bubble whose interest is going to outstrip GDP? Not those huh? Large language models?
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[ 0.48 ms ] story [ 29.6 ms ] threadBut as for their "The bottom line: AIs don't know what they don't know. And that can be very dangerous" ...
Do they mean exactly like the non-ai trading algo's, or the TA-bro's, or every day-trader on the planet?
I'd personally worry more about some corp truly figuring out next level AI trading and just amassing trillions in a very short timeframe.
- Barring market microstructure considerations altogether, aren't there human-engineered failsafes in place to prevent market selloffs? Most recent and salient example that comes to my mind: circuit breakers during the multiple day sell-off on news that COVID was indeed serious.
- Additionally, weren't most fears re. algorithmic trading in the US equity space addressed in the early 2010s?
- We saw Zillow (using Facebook's Prophet), Redfin, and Opendoor apply algorithmic trading to homes. Did they really have an outsized effect on housing liquidity? A superficial look at the numbers tells me that on paper, wealth was redistributed from their pockets.