Tag Archives: networks

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Econopocalypse scenario #3654: the Fat-finger Collapse

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Ars Technica has an interesting article about a couple of recent stock-market glitches caused by high-frequency trading algorithms run amok. Long story short: a screw-up at Credit Suisse was caused by “a trader who accidentally double-clicked an icon in a trading program’s interface, when he should’ve single-clicked“.Yipes.

OK, so it’s not quite the same as a tired technician leaning on the nuclear launch button by accident, but given the utter dependence we have on the instruments of high-speed high finance, similar mistakes could cause global catastrophes. [image by Coffee Maker]

The problem is connected to so-called “day-traders”, computer-assisted stock deals that occur in the blink of an eye, often without much human interaction, and minor errors are amplified at the speed of light (or at least the speed of data in optical fibers) by the networks, causing fluxes that folk like you and I never notice, but which cost bankers and investors thousands of dollars in losses and fines…

Of course, the fact that such computer-driven volatility hurts day traders matters little to long-term investors. But the fear is that these glitches are fleeting indications that the system as a whole is vulnerable and unstable, and that the right combination of circumstances could cause what happend to RMBS to happen on a wider scale. This is especially true as even more of the trading activity, even among individual traders, shifts to automated platforms.

However, it’s not all doom and gloom; the last few years have seen a sharp increase in small trading firms of the two-guys-and-a-fast-computer type, small independent operators using the same techniques as the big banks to trade automatically through the blind of commercially-available trading software.

The Obama administration’s efforts to rein in high-frequency trading by eliminating flash orders and banning proprietary trading (much of which is HFT-based) from large banks will probably have the effect of leveling the playing field a bit for these smaller algo shops. As Matthew Goldstein at points out in his Reuters article on the topic, the prop desks may disappear, but the software and expertise will not. Instead of being concentrated at a few large banks, algo trading will just spread, as the talent behind it either jumps to new funds or goes solo.

Once again, the network corrodes hegemony… but whether a world where anyone and his dog can engage in automated high-frequency wheeler-dealing will be a safer, better and richer one remains to be seen.

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Biological cells as cloud computing networks

webIn an interesting confluence of ideas, and of the unintentional biomimicry at work in cloud computing, researchers identify parallels between biological cells and computer networks:

Gene regulatory networks in cell nuclei are similar to cloud computing networks, such as Google or Yahoo!, researchers report today in the online journal Molecular Systems Biology. The similarity is that each system keeps working despite the failure of individual components, whether they are master genes or computer processors, which paves a way to the next gen secure web gateway
…
“It’s extremely rare in nature that a cell would lose both a master gene and its backup, so for the most part cells are very robust machines,” said Anthony Gitter, a graduate student in Carnegie Mellon’s Computer Science Department and lead author of the Nature MSB article. “We now have reason to think of cells as robust computational devices, employing redundancy in the same way that enables large computing systems, such as Amazon, to keep operating despite the fact that servers routinely fail.”

It is fascinating how natural selection has already discovered many of the same processes used by human engineers.

[via Technut News, from ScienceDaily][image from Jus’ fi on flickr]

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Psychohistory in the real world

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crowdResearchers at Indiana University believe that it may be possible to create a real-life version of Isaac Asimov’s concept of psychohistory:

Much as meteorologists predict the path and intensity of hurricanes, Indiana University’s Alessandro Vespignani believes we will one day predict with unprecedented foresight, specificity and scale such things as the economic and social effects of billions of new Internet users in China and India, or the exact location and number of airline flights to cancel around the world in order to halt the spread of a pandemic.

Psychohistory as described by Isaac Asimov holds that “while one cannot foresee the actions of a particular individual, the laws of statistics as applied to large groups of people could predict the general flow of future events.”

This certainly seems similar to the ideas of reality mining discussed here:

Vespignani writes that advances in complex networks theory and modeling, along with access to new data, will enable humans to achieve true predictive power in areas never before imagined. This capability will be realized as the one wild card in the mix — the social behavior of large aggregates of humans — becomes more definable through progress in data gathering, new informatics tools and increases in computational power.

It is an exciting direction, and offers the possibility of a black-swan style technological breakthrough. With improved data, through things like spimes and ubiquitous computing, combined with improved data processing techniques and communications there exists the possibility for a new and powerful way of studying, monitoring, and even controlling social and technological developments with precision.

[via Next Big Future][image from woodleywonderworks on flickr]

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Will the internet wake up one day?

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The internet embodied?New Scientist is running a series of pieces on “the unknown internet”, dealing with some of the more frequently asked but infrequently answered questions about our globally pervasive intangible friend. And what better a question than the biggest: could the internet become self-aware? To which the answer is, apparently, “yes, but not like SkyNet in that movie”. [image by Marcelo Alves]

Not that it will necessarily have the same kind of consciousness as humans: it is unlikely to be wondering who it is, for instance. To Francis Heylighen, who studies consciousness and artificial intelligence at the Free University of Brussels (VUB) in Belgium, consciousness is merely a system of mechanisms for making information processing more efficient by adding a level of control over which of the brain’s processes get the most resources. “Adding consciousness is more a matter of fine-tuning and increasing control… than a jump to a wholly different level,” Heylighen says.

How might this manifest itself? Heylighen speculates that it might turn the internet into a self-aware network that constantly strives to become better at what it does, reorganising itself and filling gaps in its own knowledge and abilities.

If it is not already semiconscious, we could do various things to help wake it up, such as requiring the net to monitor its own knowledge gaps and do something about them. It shouldn’t be something to fear, says Goertzel: “The outlook for humanity is probably better in the case that an emergent, coherent and purposeful internet mind develops.”

So, it might well become self-organsising and self-improving, but it’s not going to start asking itself philosophical questions with disturbingly nihilistic eschatological answers. Which is kind of reassuring and disappointing at once… but maybe that’s just what it wants us to think, eh?

I mean, has anyone ever met this Goertzel guy? How do we know he’s not just a digital figment that the internet has created as a PR tool to cover its tracks? What if it really woke up in around 1996 after a particularly acerbic post from Tim Berners-Lee, and has ever since been gorging itself on dropped packets, misspelled tweets and bandwidth scavenged from garish gifs spread across a multitude of automatically-registered Geocities accounts?

What if most of what we read every day is in fact created by the internet’s capricious and playful hive-mind, just to see how we react? 4chan, the Chocolate Rain guy, Cory Doctorow and the country of Moldova, all just slices of a fictional world designed to distract us from the Matrix-esque meat-factories in which our dreaming bodies are incarcerated and milked for cellular energy to drive an ever-expanding cloud of computronium… I’M ON TO YOU, INTERNET! YOU’LL NEVER TAKE ME ALIVE!

Nurse, I think it’s time for my pills.

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Quantum cognition: spooky action in word recall

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fractal_networkA fascinating article here at Physorg on how human beings remember and recall words. Researchers at Queensland University of Technology and the University of South Florida compare two ways of thinking about connections between similar words 1) Networks of similar words and 2) something analogous to spooky action at a distance:

…the researchers suggest that the probability of a word being activated in memory lies somewhere between Spreading Activation (in which words are individually recalled based on individually calculated conceptual distance) and Spooky Activation at a Distance (in which the cue word simultaneously activates the entire associative structure).

Most likely, Spreading Activation underestimates the strength of activation, while Spooky Activation at a Distance overestimates the strength of activation.

The researchers are using quantum physics as an preexisting abstract framework for their mathematical models for how human beings remember:

In the new model, associative word recall probability depends on how strongly connected the associated words are to each other.

For instance, “Earth” and “space” are entangled in the context of “planet,” but “Earth” and “gas giant” may not be entangled (though “Jupiter” and “gas giant” may be).

Words that are entangled with many other words have a greater probability of being recalled, while words that are entangled with few or no other words have a smaller recall probability.

At this stage this is theoretical, but the long-term consideration is for the development of AI and similar technologies:

As our information environment becomes more complex, we will need technology that can draw context-sensitive associations like the ones we would draw, but increasingly don’t as we lack the cognitive resources to do so.

Therefore, such the ‘meanings’ processed by such technology should be motivated from a socio-cognitive perspective.” This kind of research is an example of an emerging field called “quantum cognition,” the aim of which is to use quantum theory to develop radically new models of a variety of cognitive phenomena ranging from human memory to decision making.

Plenty of beef for the science-fictional burger bar.

[image from zeroinfluencer on flickr]