Money and Speed: Inside the Black Box

Money and Speed: Inside the Black Box

2011, Economics  -   33 Comments
8.53
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Ratings: 8.53/10 from 92 users.

Money and Speed: Inside the Black Box is a thriller based on actual events that takes you to the heart of our automated world.

Based on interviews with those directly involved and data visualizations up to the millisecond, it reconstructs the flash crash of May 6th 2010: the fastest and deepest U.S. stock market plunge ever. Money and Speed: Inside the Black Box is developed by filmmaker Marije Meerman in close collaboration with design studio Catalogtree.

This exploratory documentary is a marriage of strong storytelling and meticulous visual analysis. A rare opportunity to experience what is happening inside the black boxes of our rapidly evolving financial markets.

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ElaineMDG
6 years ago

Sorry,ni thought I'd be able to edit that last post since I'm posting from an iPad and couldn't see it all before posting.
In the 4th paragraph, that *should* read "set and forget; let the computers run the trades for you".
Just for clarification: I DO use an EA (expert advisor), but not for actual trading. A friend helped me adapt one he wrote that I can use it for back-testing strategies-that's IT! EVERY person I've spoken to who has been trading for a length of time, (>5yrs), has had problems, losing money, because of EAs. While I'm sure there are perfectly good ones out there, I prefer not to take the chance. Not to mention, I also am REALLY enjoying manually trading

ElaineMDG
6 years ago

Wow...I'm wishing I'd watched some of these documentaries before I decided to get into this field about 6 months ago. Although I've learned a LOT these past 6 months, the first thing I learned was its even more laden with crooks and con men than I ever thought-especially a newbie going into Forex trading. Perhaps it's my age, but I approached everything with a cynical eye and sought out some trusted, long-time traders, reputable review sites, (there ARE some out here that aren't owned by sleazy brokers-or MLM Marketers badly disguised as "brokers" or "traders").
I'm in a situation due to my age and disabilities, that I haven't many options for any type of employment, (housebound, unable to drive and stuck in a very small town). Having an advanced degree and almost 30yrs in medicine has also limited my choices, and I had to learn about the markets and financial system from the ground up. I've certainly had some bumps in the road, but am grateful to a few knowledgable, honest people who've taken me under their wings-including one gentleman who put me through 6 weeks of intense study of the fundamentals and economics of the markets.
I'm not delusional and because of tight risk-management, know it's going to take awhile to compound my account to a point I can begin withdrawing money. There is NO HOLY GRAIL, NO "Get rich in a short period of time"!
I WILL say that when it comes to automated trading, you're bombarded with programs and promises of "set and forget, let the so putters do your work for you!", at every turn. I'm constantly told, (NOT by the people working with me, others in the field), that the ONLY way forward in trading is automation-using algo's and or some of the new "expert advisors" that supposedly "learn" from their errors or losses.
Maybe I'll be left behind and end up losing everything; but I'll stick with doing everything manually, even if I have to sit at the computer at all hours, 12+ hours a day!! Right now, I'm doing pretty good and was even approached by a firm last week to "try out" for a permanent position in their company. After looking into them and then talking to them again, it turns out they do mainly HFT and algo trading-just need folks to "man the machines" so-to-speak. Although they expressed interest in my strategy I use "news trading", I declined their offer.
I'll stick with my small, humble, manual system on my own. I always knew the risk I was taking when starting this, I was out of any other options. Who knows, maybe in the next year I'll be able to start paying myself a small salary. The hope, purpose and education I've gotten so far are already more than I expected!!

Philosochef
7 years ago

Sounds like the first successful test of a stock market bomb. They left it on just long enough for effect and then they switched it off and the market quickly recovered....
"Cool, ok so now we know that we can crash the market whenever we feel like it. "

awful_truth
9 years ago

Another excellent documentary that goes hand in hand with 2 other documentaries, 'The Wall street code', and 'Quants: The Alchemists of Wall Street'. I advise everyone to check out all 3 of these documentaries, (all on this website) and you will never invest any money in the stock market. Why?
Simply put; it is a rigged game, the rules cannot be enforced, and majority of money is no longer made because of investing in a good stock. This ability is even beyond your bank, let alone your financial advisor, or stock broker. (time is money; especially at the micro-second)
Since 1920 when Charles Mitchell got the idea to get the general public to invest with the intent to "spread the risk", technology has now ensured that the general public will only lose. (even the wealthy are at risk again, unless they have the fastest connections, and the best algorythyms working for them)

10 years ago

really a informative and useful documentary...i like this very much.

10 years ago

So damn clever, not, the bottom line is 'organized crime' - small wonder as to why the Germans hated the Jews - different time same old tricks, it's all a bunch of crap - then they take their wealth and further deplete the planet of natural resources - ain't that just sooo genius for ya.

chard01
10 years ago

all offshored accounts i have closed now keep all cash kept in jar buried under rhondedendra such a nice flower ever greening.

10 years ago

As a Surgeon living overseas, the letter that Bernard Madoff wrote a few days ago gave me reason to close all my accounts and relax for a few months, for what it's worth.

Joseph Huntington
Cebu City - Phils

StevenLJones
10 years ago

probably organized crime. But what happens when RTD2 decides it doesn't what to be turned off?

kaitse8
10 years ago

The system is corrupt!

BruceEWoych
10 years ago

computational LOOTING ...the flash crash was orchestrated.

emp12345
10 years ago

if they say they don't know what happened during the flash crash, now that is just a lie. The people in control of the machines obviously know what happened. In the USA all this information is stored. But the people in control will only use it against those who challenge their authority. It is just a small gang with power and they will loot and steal until the whole thing collapses.

About trading. Apart from the fact that the big banks can use flash orders, fractional quotes to front run everybody else on top of that if you place a trade your trade will be immediately examined. Who is placing this trade, what is his average stop loss, what is his average profit target. Etc. I find these days that when you place a trade the price immediately moves the other way, that is in the wrong direction. Myself I find it hard to believe that my small trades have this effect ... but they have.

TheDanishViking
10 years ago

The film implies that the reason for the sudden crash was caused by some unexplainable "algorithmic trading glitch". And that the SEC tried to blame the whole thing on a specific Kansas trading company, in order to create a false sense of security. But actually we don't understand why, or what, happened, and it could happen again at any time?! Scary stuff!

10 years ago

I very well remember this very day. I was about to long GDP/JPY which already had dropped about 600 pip overnight and, suddenly I see the pair plunging another 600 pip. Immediately I put a 5-time leverage long position and in a matter of hours the pair jumped from around 129 to 136 yens. One of the most thrilling trades to date.

Subhro Paul
10 years ago

The flash crash happened because of dumb execution. Why blame it on the electronic trading and computer algorithms. The firm that is responsible for this lost money due to this faulty execution. Anyways if you believe in firm foundation theory, it doesn't matter what happens on one day of trading.

Sieben Stern
10 years ago

I get this feeling like their video gamers whining about lag, except this is a scam that effects everyone.

pwndecaf
10 years ago

This is a very good doc. I have also taken as much risk out of my money as possible, not because I'm so smart but because I know Big Finance, Wall Street and the Government are all scamming everyone else. The problem is that they are allowed by the government to get away with it. The fact that the SEC won't or "isn't allowed" to look into who made those trades at the millisecond level is not surprising to me - it would provide the smoking gun, so just look at it at the time scale of a second and it is all hidden.

Bill Black has a few minutes in this doc and is a hero of mine. He was in charge of investigating and prosecuting those involved in the S&L scandal some years ago. He is a frequent commentator on the fraudsters and banksters stealing our money now. He rails against those that refuse to do anything about it - where are the prosecutions like the ones he brought about in his day? The fraudsters play the game with zero risk as they are all institutions too big to fail, so we bail them out. It has to stop.

Read naked capitalism dot com every day - you will learn a lot and you won't like it. They frequently link to Bill Black's articles. Prepare to get angry, just as I hope you do when you watch this doc. Very good stuff!

10 years ago

It might be interesting if the average person were to obtain a high frequency trading program (free off the internet) that would add to the current noise in the system. Millions of average people trying different algorithms and causing trading resonances that produce wild mountains and valleys. The insaity of it all is appealing.

10 years ago

Fascinating and scary. One more for the collection! This could have been a powerful muscle flexing message to government to back off from regulation and influence. An orchestrated scare would explain why the system recovered as quickly as it started, and remains totally unexplained. But worse is that the power this wields for anyone who understands the mechanisms is the basis for huge future bank bailouts by simply saying "It wasn't our fault, the machines ran out of control."

On the one hand the guy above says the machines only do what they are told and we've watched The Terminator too many times, but then the other guy (the historian) says the machines can implement new self evolved algorithms, making it more and more unlikely for us to know what's going on under the hood.

This is approaching what is referred to in A.I. terms as 'the hard take-off': a scenario in which you plug it in for the first time and it instantly prevents itself from being shutdown. Most A.I. guys say this is extremely unlikely and imagine true A.I. coming as a soft take-off through evolved learning over time. Either way it seems likely that the stock market would be it's birth place. This documentary makes it clear that the jury is out on what might happen with these machines - they are already capable of working their instruction sequences outside our concepts of time.

Somebody should make a movie about A.I. machines triggering a global economic revolution in a billionth of a second.

Geoffrey Grekin
10 years ago

Wall-street is a farce!
Hi-frequency trading only benefits those that can afford to play the game, billionaires who make billions on micro-trades through high powered computers and algorithmic formulas.

They collect millions n a day and contribute a big fat 0% to the society their siphoning. This money they accumulate for their selves is taken from heart of the economy, investors, producers, innovators, picking away at them few cents at a time in a matter of a 10ths of a mili-second robing them all indiscriminately.

So i'll reiterate, the stock market is a joke! and the economy is the punchline.