Does having greater dependence on computational algorithms make the market more rational?

[Asher]

None of those are relevant as objections to automated trading. You need humans at some stage of the production process for cars, too.

Why?

I see nothing that would necessitate a human. Mineral extraction, transportation, fabrication, assembly, shipping...all could be theoretically automated without human involvement. Whether it makes sense to do so (and it doesn't) isn't relevant.

[Kuciwalker]

Why?

I see nothing that would necessitate a human. Mineral extraction, transportation, fabrication, assembly, shipping...all could be theoretically automated without human involvement.

Yes, and theoretically you could also automate the same data analyses human traders do. So what?

[Asher]

The analogy with the car production process is ridiculously bad. It's actually worrisome that it keeps coming up.

Economics is not comparable with an assembly line.

[Asher]

Yes, and theoretically you could also automate the same data analysis human traders do. So what?

Data analysis? Yes.

But you're missing the core point of the market. Without human actors, there's no underlying value. The computers analyze data generated by human actors.

[Kuciwalker]

Data analysis? Yes.

But you're missing the core point of the market. Without human actors, there's no underlying value. The computers analyze data generated by human actors.

Without people to design or drive the automobiles, there's no point either.

[Kuciwalker]

(There's also no reason that in your hypothetical super-automated economy you couldn't have markets where all of the participants and traders were robots/computers.)

[Dauphin]

None of those are relevant as objections to automated trading. You need humans at some stage of the production process for cars, too.

I'm not objecting to automated trading. I am saying it has a significant limitation.

[Kuciwalker]

I'm not objecting to automated trading. I am saying it has a significant limitation.

As long as no one proposes outlawing human trading, I think we're okay on that front...

edit: are people interpreting the OP as removing humans from the loop entirely and universally? I was always reading it as just putting a computer in between the human analysts and the actual exchanges

[Asher]

Without people to design or drive the automobiles, there's no point either.

Are we talking about production or consumption?

[Dauphin]

"are people interpreting the OP as removing humans from the loop entirely and universally?"

I was.

"I was always reading it as just putting a computer in between the human analysts and the actual exchanges"

Wouldn't that slow things down by adding an extra step.

Also, aren't all exchanges electronic these days?

[Hauldren Collider]

The analogy with the car production process is ridiculously bad. It's actually worrisome that it keeps coming up.

Economics is not comparable with an assembly line.

How about farming? It takes one farmer to farm an entire field when it once took thirty. What if all the machines had the same bug that caused all the farming equipment to stop OH MY GOD WE WOULD STARVE AND FELCH WOULD NEED TO HIJACK THOSE OIL TRUCKS ON PICKETT ROAD

The world would just END!

[Asher]

I don't know if I'm just not making myself clear or if some people just think on rails.

[Dauphin]

His concern would not be that it stops. It would be a bug that caused the farming industry to be negatively affected. e.g. a dustbowl.

[Uncle Sparky]

The biggest current problem isn't software or testosterone, its the furtures market. Originally created to stabilize commodity markets, its now a crap shoot where large firms hold loaded dice. It is estimated, for example, that 10,000 barrels of oil are traded on the futures market for every barrel actually produced.

[Kidlicious]

I wonder if this is really more efficient in the long run. Do the programs really save labor or do they just create more trades. If they just create more trades they aren't increasing productivity in the long run.