[ExI] Hard Takeoff-money

[Tom Nowell]

The problem is worse than you think it is -  last week's Economist had an article summarising a paper that showed where the best locations were to situate your computer equidistant (signal-time wise) to two trading exchanges so you could get the best arbitrage between the two. Yes, setting up a server farm in Alaska so you can exploit the differences between Tokyo and New York may be the next big thing.
 This article http://www.economist.com/node/17202255?story_id=17202255
finishes by mentioning that despite the fast pace of automated trading, they may not be able to outrun regulators.

Bill wrote: (But surely the burning torches and pitchforks can't be far away, can they?).
 And Keith replied: That is _so_ 17th century.  Surely you can think of something better.

Yes, the 20th century solution of "Hello, we're the SEC/IRS/other agency that might claim jurisdiction and we're here to shut you down while we go through the books" will work just fine. Money as a data pattern in a computer is wonderful (allows me to draw my cash from an ATM all over the place) but is instantly stoppable by government fiat. If your account is suspended and all transactions coming from it are investigated, having a trillion dollars of trading profits may not help. (It may encourage lawyers to take on your case on a no-win, no-fee basis though as they can dream of the moolah if they win).

Tom