Kind of reads 25 people's stories about "How I became a parasite". Why not create new things, instead of making a career out of leeching the wealth created by others?
A better angle is how finance tends to acquire a ton of smart young people that could/would otherwise be doing work that has more benefits to society. It’s hard to blame the individual here, because the salaries are orders of magnitude larger in finance vs. say, aerospace engineering. Would I turn down $700k at a hedge fund to earn $90k at a science lab? Probably not, unless I was already independently wealthy.
It is easy to fall into the trap of thinking HFT/low frequency quant firms "leech wealth".
You can get out of the trap by learning about what they do and the essential role they play in the proper functioning of our markets.
Firms specialize in intercepting trades and then placing trades faster than 99.9% of others.
These institutions hide behind "we provide liquidity" like it's a selfless act of kindness, whereas that's just a mere side effect, and just one of many.
The entire modern financial system is layers and layers of unneeded complexity that almost solely rose out of people trying to leech money from the system. These financial institutions have built the entire system around them so that now they can say "look at how essential we are!".
depending on jurisdiction and TOS, this maybe legal, but it needs to be announced somehow to the customer; a capital management firm of an ETF needs to buy the included shares, e.g; those have no money "sitting around"?
We are not in disagreement.
But it is ignorance to say the system would work better without any involvement of HFTs.
I didn't go to NYC, but Money is fungible so it's a simple math problem.
How much non-parasite good can you do making $50k/year * 10 years? Even if we ignore taxes and you donated your entire salary, that tops out at $500k worth. If instead you could make, say, $500k/year * 10 years, and then quit and form your own non-profit for $2,000,000 and do 4x as much good.
> COWEN: Then you keep on playing the game. So, what's the chance we're left with anything? Don't I just St. Petersburg paradox you into nonexistence?
> BANKMAN-FRIED: Well, not necessarily. Maybe you St. Petersburg paradox into an enormously valuable existence. That's the other option.
I'm not saying the pressures are absent, but they are hopefully vastly less compelling for any normal person with a more standard view of risk and utility. ("Sure, I'll just cover up this little bit of fraud, because that's got a better than 50% chance of success" is a course of action SBF all but said he would take, months in advance!)