Financializing Intelligence: On the Integration of Machines and Markets | Article by Orit Halpern | e-flux

Financializing Intelligence: On the Integration of Machines and Markets

Orit Halpern

Noise in the sense of a large number of small events is often a causal factor much more powerful than a small number of large events can be. Noise makes trading in financial markets possible, and thus allows us to observe prices for financial assets… We are forced to act largely in the dark. —Fischer Black1

In 1986 Fischer Black, one of the founders of contemporary finance, made a rather surprising announcement: bad data, incomplete information, wrong decisions, excess data, and fake news, all make arbitrage—purportedly risk-free investments, such as the profit that can be made when one takes advantage of slight differences between currency exchanges (or the price of the same stack) in two different locations—possible. In his famous article “Noise Trading,” Black posited that we trade and profit from misinformation and information overload. Assuming a large number of “small” events networked together as far more powerful than large scale planned events, the vision of the market here is not one of Cartesian mastery or fully informed decision makers. Noise is the very infrastructure for value.

Read full article here: https://www.e-flux.com/architecture/on-models/519993/financializing-intelligence-on-the-integration-of-machines-and-markets/