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Comment by vegabook | Hacker News Reader

A case could be made though that it is OpenAI who is operating illegally, attempting to corner the market.

There is nothing suspicious or abnormal about this behavior. It is called competition. Ironically, trying to prevent this kind of behavior prevents competitiob, and is a key factor for causing monopolization

It depends... if OpenAI bought the DRAM in order to use it, then fair play to them.

If they bought the DRAM in order to stop their competitors from using it because they are falling behind, that's anticompetitive in spirit, though I'm not sure if it actually breaks any laws.

I don't see what's less competitive about that, although I do see how it might make zero financial sense.

Knowingly attempting to buy or sell in quantities likely to move markets, for direct profit, is called manipulation and is most definitely illegal. this is true in physical markets commodity markets and financial markets. Not saying that this is what openAI is doing but it definitely merits an investigation.

It's illegal if you're trying to make prices higher, but it's completely legal and normal if you actually want the RAM.

Before you buy anything from a store, do you also show them all your receipts from the other stores you visited today?

> It's illegal if you're trying to make prices higher

That's exactly the goal, to raise prices for OpenAI's competitors.

How do you know they don't just want to buy that RAM to have the RAM?

All quantities bought or sold on the margin will move the market. Whether it moves the market is not up to the buyer or seller; it is up to other buyers and sellers who react to that transaction and adjust their expectations. This is normal market dynamics, dynamics we should want to happen because markets adjusting to movements of big players performs a social function; you and I need to know how large movenents of resources affects our livelihoods, and this is how that can happen.

There is no reason to pathologize or find suspicious these normal economic facts. Especially when it is not within the power of a big player to choose how other people react to their actions, which is all "moving markets" is. If something is suspicious and illegal about that, then it is equally suspicious that you and I seem to go along with this "market movement" by these big players and pay the new prices. Are we colluding with them? We could do with less conspiracy-minded interpretations of these things.

market economics are like newtonian mechanics. It's all so wonderful and logical and even elegant, until the dimensions expand a few orders of magnitude, and then all the rules break. Having worked on a trading floor for 20 years I know how this works. Swamping a market with huge trades is definitely considered manipulation by essentially all authorities, and indeed is a form of monopoly power, which even economic theorists will agree is undesirable. Jane Street just got a mega fine for exactly this in India, btw.

I can't get over the confident dismissal of science by hand-waving about imperfect modelling. But what I said has nothing to do with that, and is more true to the real world than an idealized perfect competition model. Pathologizing normal trading behavior like this is more the result laymen and authorities misinterpreting bad economic modelling. So I recommend you take some of your own medicine and look at the mirror. Maybe a trade affecting the market isn't so suspicious as you make it out to be, because the perfect competition model you're using to make accusations of monopoly simply doesn't make sense. Again, if there is something wrong with affecting the market, then you or I are just as liable for our consciously self-interested behavior of choosing higher-quality, lower-priced products.

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