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David Leinweber, director at the Center for Innovative Financial Technology at UC Berkeley, on the SEC's newest regulation in the wake of Facebook’...
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Much is -- a -- the wake of the FaceBook IPO debacle the SEC last week approved two proposals to help to curtail volatility in the US stock market.
Might be a step in the right direction but should the markets' been thought of at this critical infrastructure are similar to say -- mountain air travel.
Our next guest seems to think so we're joined by David -- -- -- director of the center for innovative financial technology UC Berkeley.
So is this way to go about this just keep adding more regulations and have computers kind of guarding computers.
Well.
No no and yes I think we clearly needs to computers to keep -- what's going on on the market.
But the technology has gotten ahead of what people are using to do using two to monitor and control written and make it as safe as we want today.
-- -- -- this community think it's confusing for a lot of people this notion of these.
You know these dark pools are not called -- much smarter than -- and he actually use the terminator analogy as well that we have computers and machines talking to machines.
What -- human being in this culture thing.
I want.
The human beings is still making decisions on what to trade fair for the most part a lot of those FaceBook investors were FaceBook users for example.
A lot of a lot of people still -- decide what to trade.
Themselves but when once they may enter on the computer all of a sudden it's it's off into the into cyber land.
And so I really and has -- moved sort of wild and -- it yet yeah in the last ten years.
-- and we've seen the flash crash is sort of the poster child that something as it has gone a little wrong -- -- people would never do that.
I mean I -- that's the wrong.
It's a lot of something went a lot wrong it is an 860 today yeah -- -- of the equity market and we still don't even know why so.
But let me answer I mean again is the answer you know -- SEC's talking about limit up limit down on securities you know putting in better a lot of business leaders is that we -- -- we need to be able to use the methods of data intensive science.
That.
High powered computing high performance computing.
You see this used in lots of lots of context it did.
In earth science and astronomy.
And the astronomers have one big digital ally in the sky they can see everything that's happening at the Ed Henry -- if tiny fractions is that markets are very distributed there the regulation is sort of that if you.
Ad -- in some ways yes we wait for -- problem.
Yes but we -- this hidden inside the exchange will come right back to -- to everything you're saying right now and say you know what.
We did this AG and we got the GM stock got there without a hitch without a -- and a lot of it was because well.
-- -- human beings there.
They.
-- -- if every trade where would they hit between the markets would you shut down.
But there are.
You know there are thousands if you look at trader bulletin boards trader trader while trader blogs people.
Literally thousands of stories of look what the market did today wasn't bad strange.
And who to do.
No way.
To do this in -- way that dead dead.
I can save some money we can build on what we've done before I get there really has no FAA for market I don't ideas -- for market.
I -- -- I don't know what it did headline -- your thoughts are interesting I'm not sure though that.
We just -- opted science in computer sense I don't know I think we need people.
Oh no no this delay or even when -- just give them the right tools to do is give them the -- clothes that some very -- -- -- -- We're running and a -- -- at all or and David thank you.
