Flashboys
Is the title of a 2014 non-fiction book by Michael Lewis about high-frequency trading (HFT).
The story is told about a trader, Brad Katsuyama who discovers that computer programs on exchanges play dirty when it comes to buying shares.
The computer programs operated by ‘stock scalpers’ allow you to purchase part of the stock, so they know that you’re in the market for buying. Then they race to other exchanges and then buy the stock ahead of you to only sell it on to you at higher prices and make a handsome profit.
In essence this is AI at it’s worst, allowing crooks to manipulate the markets and if trained traders didn’t even know this was happening, the ordinary punter doesn’t stand a chance.
It’s incredible to think that we are living in a world where we are all trying to make money from each other for the benefit of ourselves instead of the greater good.
There are millions, no billions of people on the poverty line on this planet, hundreds of thousands of individuals who are homeless in the Western World and we have traders who are making billions from other traders by manipulating the systems with AI.
Thankfully Brad Katsuyama is doing something about it although he’s getting a rough time and is having to fight against the trading exchanges mafia.
Happy trading!