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July 16, 2009

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The Robots of Wall Street

Story idea, spurred by an odd and entertaining NYT op-ed.

Yes, everybody knows that these days, most trades on Wall Street are between computer programs. But that’s such a lame generalization. What kind of computer programs? What’s the taxonomy? What do they look like?

The story would basically be a slide-show. Each slide would focus on one flavor of financial app. It would feature, ideally, an actual screen grab—fully annotated—or if that’s not available, a wireframe, based on descriptions and sketches.

It’s likely that many of these apps don’t have user interfaces at all, because they don’t have users. They’re trading daemons—headless market-makers. In that case, I want to know how they think. Imagine a diagram of the basic logic loop that propels a trading-bot through the day. I’m not looking for Goldman Sachs’ secret sauce, here; I want computational finance 101.

The screen-grabs are the key, though. Maybe I’m weird, but honestly, I’m sorta desperate to know what this program looks like:

[…] the finance industry’s standard software for structuring bonds based on pools of mortgages (yes, you may have heard of the unhappy consequences of this process) […]

This is one of my favorite kinds of stories (in theory) because a) this knowledge is all out there, and widely distributed—just not crisply packaged, and b) to lots of people, what I’m suggesting would sound completely absurd and boring, because “the finance industry’s standard software for [etc., etc.]” is just the terrible, frustrating program they use in their job every day. Yes! Both are good signs: It means there’s an opportunity for journalistic arbitrage!

Posted July 16, 2009 at 11:44 | Comments (0) | Permasnark
File under: Briefly Noted
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