Authoritarian

Recall the slowed down video of a House Speaker Nancy Pelosi (D, CA) press conference in which the slow-down was done to make Pelosi’s speech seem slurred. It was an obvious, if poor taste, parody of Pelosi’s speaking style and of the incoherence of her anti-Trump position, as viewed by many.

In a The Atlantic interview, Hillary Clinton expressed her outrage over Facebook’s handling of that video.

Google took it off YouTube…so I contacted Facebook. I said, “Why are you guys keeping this up? This is blatantly false. Your competitors have taken it down.” And their response was, “We think our users can make up their own minds.”

Zuckerberg’s view, according to the Atlantic‘s author, is this:

“It’s not about saying, ‘Here’s one view; here’s the other side’,” Zuckerberg had said when I’d asked him to reconcile the apparent contradiction between fact and opinion. “You should decide where you want to be.”

Then Clinton said, in response to the author’s prompting about that,

It’s Trumpian. It’s authoritarian.

It’s true enough that opinion should be clearly discriminated from fact. But underlying Clinton’s (and the author’s) angst is their dismay over people making up our own minds, rather than being told what to think, what to believe, by our Betters.  Not allowing journalistic gatekeepers and filters to control our opinions is somehow authoritarian.

This is highly instructive, and it should be kept in mind this fall as we vote.

Ultrafast Trading Costs

British regulators have studied the “tax” imposed on ordinary traders by ultrafast traders. The latter use high speed computers and powerful algorithms to

“latency arbitrage,” in which ultrafast traders seek to react to fresh, market-moving information more quickly than others can.

The latency is the ultrafast traders’ ability to act on slightly out-of-date prices that are inaccessible to the bulk of us traders because we don’t have those fancy computers running those algorithms. The “tax” metaphor is the difference between those (very—a matter of microseconds) slightly dated prices and the prices available to us in more real time.

The “tax” amounts to some $5 billion gained globally by the ultrafast compared to the rest of us. That seems like a large number, but put it in perspective.

The value of the aggregated global stock markets was around $86 trillion in 2019. The “tax” from the ultrafast’s computing/time advantage amounts to a bit under 0.006%.

That’s not to say the artificial arbitrage shouldn’t be addressed, but it does suggest that the urgency isn’t great. We have time figure out how to level this tiny bump in the playing field without moving, for purely noneconomic reasons, to restrict some traders to the advantage of others.