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Paul Peters
Interests: the friction between fantasy and reality..
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Good post. The idea is that "rebuilding trust" can be done via impression management, advertisement, astroturf, marketing and spin.... and this is exactly how one looses trust. Maybe start by public excecution of marketeers.
Automation does not have to imply dehumanization.
If banking is a technology business, doesn't this make the CEO the CBO? Why have a separate business unit that deals primarily with technology at all?
That's odd.. you just stumbled on the same phenomenon me and some others identified as one of the primary underlying reasons for investment and innovation stagnation. Let me introduce you to one of the many built-in psychological shortcuts we humans posses: If you extrapolate this to decision making processes, beyond the illusionary proficiency of quantitative analysis by virtue of using weighing numbers which have no real valuation framework, would you think this to be a valid approach?
Some interesting views are put forward in the recent Adam Curtis documentary "All Watched Over By Machines Of Loving Grace" This week's episode concerned "The Use and Abuse of Vegetational Concepts" about ideas of self-organisation in holistic ecosystems and how that is a gross simplification misrepresenting the world.. Enjoy.
Hmmm, so you're behind Tony Blair being called on trial as one of Berluscommedia's witnesses to 'prove' bunga bunga parties are really oldfashioned decent fun? i would wrap it in a self-sustaining attractor, but despite that i must say it's a very good stance though. i like it.
Jacques, i think we agree there, because i don't go for any backwards in time scenarios either. It started to feel like the EU ministers contradicting the rise of prices as "it is not inflation".. No, it was a whole bunch of opportunists raising their prices because simultaneous with the introduction of the euro most agreements on ceiling prices were let go. Anyway, i read r&d reports every day, and have been since discovering email, but don't keep track of it. When mentioning the speed of quantum entanglement the speed of light is only used as a yardstick to signify the order of magnitude, and assigning a large yet finite speed avoids mathematical/physical oddities such as "instanteneous". As tried to explain entanglement seems to move faster, but it doesn't violate causality. So, if we take an isolated situation entanglement may be moving at a greater speed when entanglement is 'reprocessed' again at the target all differences are evened out. So the quantum channel and classic channel appear to hold each other in balance. And this has recently been used to improve the accuracy of classical communication from some 80+% to 90+%, entanglement acts here as a sort of controller mechanism of guided decoherence. This is roughly the realm discussed in most textbooks, but it is more or less classical to quantum to classical. Which is great for teleportation purposes. The space for fiddling is about the size of a photon.. but then we get into strange setups as Bose-Einstein condensates which can compose a 'super photon' and other pairing and coupling phenomena which aren't widely understood yet. The idea is to smear out an entangled photon and use that pick up any changes. But even if using a wiretap, which was shown several years ago in the UK to use resonance of an adjacent wire to copy about 40% of information flowing through a quantum cryptographic network.. what will happen if ten wiretaps are used and enough information is gathered to recompose a message. In most textbook samples the situations are highly simplified, and a communication channel is assumed to be like tickertape.. but that is not how interpretation works as we read word by word and the "rset can be a toatl mses and you can sitll raed it wouthit porbelm." (which parallels Godel's critique on Turing's solution) Weirder things have happened at sea, but i don't know how many years ago, i guess around 2005, an expirement was reported concerning a laserbeam directed at a supercooled gas, Argon or Xenon, and the lightbeam came out the other end just before actually hitting the one end. And then of course the lightbeam went in and out and rejoined with the 'mirage'. Those are quite dramatic events though, i know of little research looking into Cherenkov radiation or even ways look inside a black hole. Then again... i know several senior scientists who worked at Lockheed, IBM or others, and much of the current research isn't really public. Too much money involved.. But this is where most of the fun is at. Quite some work is going on considering re-coherence and group behaviour, the threshold in combinatorics in a spin network when the collective starts behaving like a manifold / continuous surface. Luckely some is public, such as the research from Austrian scientist Simon Gröblacher which has some highly intruiging consequences. Whether any of such breakthroughs have any significance for trade networks i don't know, i would imagine not considering the conservation of causality within the local realism domain. I don't think it matters that much. Anyway, maybe yes, maybe no, science and technology are caught in a positive feedback loop and many predictions from the 80's and 90's are actually being pulled closer to the now. It makes 'laws of nature' seem more like 'habbits of nature', and what were once thought as eternal transcendental rules are now being reconsidered if they can't be better described as immanent evolutionary programs. Everything together, technology is moving so fast, set standards change so rapidly, and along with the usual market dynamics it will 'disintermediate' banks within the foreseeable future, unless banks change their model. Take care Paul
Jacques, See how it works? Actually, it greatly annoyes me, and maybe you don't get that told often enough? Your manner of discussing is closer to rethorical play then displaying scientific exploration, and i think such is meaningless unless one is into powerplay. Science is an ongoing progression of lessons and learning events, the speed of entanglement has only been determined 3 years ago, and has nothing to do with violating the speed of light, as indicated in the article and research paper. If i have learned anything that is that human ingenuity stops at nothing, neither does the universe. This is a subject matter to which there is no clear answer, and many teams are working on creating an answer and making things work in manners unforeseen. I haven't bothered to make up the balance on what the state of the art may be if it accepted as a 'fact'. Maybe there is no-cloning theorem, but what is happening with multiple exciton generation doesn't seem to need it. No-cloning does allow for imperfect cloning, and that may be enough in some cases. Another area to look into is quantum corrals ( with which IBM researchers have been able to 'scratch' circuits on a wavefunction, AND retrieve information from it. Usually that would involve a collapse of the wave function, but with some ingenuity they managed to avoid a reduction to classicality, similar like chlorophyll appears to stretch out the collapse phase to a duration several orders of magnitude longer. Also 't Hooft has been making great groundwork with alternative interpretations bypassing some of the limitations But of course that is all theoretical fluff..
Jacques, Get a grip. The backwards in time comment was a *joke*, and as i tried make clear the results from quantum information theory and relativity physics are NOT contradicting each other. First you come with a physcis forum which is large populated with hobbyists and people advocating their own theories. Then you refer to a 675 page book, that allegedly proves your claim which does so in chapter 2.4.3 with a "theoretical proof" concerning the intermingling of the classical channel end quantum channel involved in "quantum teleportation" alongside a classical communications channel. This has indeed been proven several years ago where the quantum information flow acts as a sort of controler for the classical information flow. Does that match up or contradict the textbook, is it ok and is it fluff and proving your stance in a reductio ad absurdum way? I'm working on other things at the moment and don't have much time to look into scientific articles which prove or disprove you stance. Do check out There are 889 papers using the word 'superluminal', i am terribly sorry that i don't know them by heart. Either way General Relativity doesn't say there is a maximum speed to events in the universe. Anyway, it seems to be a big issue for you not only being right but being acknowledged for being so. I really cannot say that you are, even if you insist on wasting more time on a futile discussion which unfortunately reminds me of Oliver Wendell Holmes idea of the "hydrostatic paradox of controversy": "You know that, if you had a bent tube, one arm of which was of the size of a pipe-stem, and the other big enough to hold the ocean, water would stand at the same height in one as in the other. Controversy equalizes fools and wise men in the same way. And the fools know it." Have fun Paul
Jacques, does controversy make it less viable? Did you read the actual papers? Did you read Bell's actual papers? The reference was just for demonstration purposes that there are quite some interesting progressing insights in the nature of local reality and global reality. For example Gerard 't Hooft's work addresses related issues, but eventhough classical and quantum reality seem to intermingle, causality is not violated. Alain Aspect's work has been around since 1982, and i recall reading some in the late 80's, early 90's from the Max Planck Institute where polarization was transmitted. At that time they still thought it was instantaneous. A recent experiment is available on Some more is available on The fact that it happens has passed the 'trough of controversy' about a decade ago.. Next you're going to tell me that quantum mirages aren't true and that quantum teleportation can never happen.. :-)
Jacques, true but there is a caveat to it. "speed of light communication" concerns classical causal exchange of physical information, but it is possible to exchange quantum information such as the polarization of a photon exceeding the speed of light. What you're referring to seems to be about the fact that the two physical models do not conflict within the domain they are applicable to. Like Penrose i remain a solid fan of general relativity and think it is a 'strong' framework than quantum field theory. If you have a physics background, do check the papers by Joy Christian who has reformulated Bell's theorem to fit in a world dominated by Clifford Algebra instead of arithmetic. Anyway, that's not the point here, it seems we're both surprised about the mathematical tools used. Hardware performance may be growing fast but human ingenuity remains the magic sauce and appears to be responsible for efficiency doubling every year (according to a recent PCAST report), and with crossfertilization among different knowledge domains there is no reason to assume a slowdown in this accelerated pace. I am much more interested in r&d for science and technology than in financial instrumentation so i don't know the ins and outs of the latter, but i do continue to be surprised about how crude and slightly outdated the tools seem to be. I have no insight there, and i would assume the more appropriate maths are for internal use and focussed on datamining instead of trade activities.. but then, why not create a continuous feedback loop so that the probabilities are adjusted in near-real time? I can understand Finance as an industry is only exploiting only a few possibilities of a whole range (, but any senior computing scientist that i know within the financial world sees the falsity of these models, unless of course they have some kind of personal or professional bias such as career investments in advocating the illusion of infallibility... There are some great lectures by Gregory Chaitin on youtube on where mathematical logic breaks down. That's not going to stop things though.. and why would it, because it is rather clear these formulas are rather selffulfilling, they become more true the more often they are applied. Just like Nash equilibria, which are so widely used in evolutionary modelling with game theory while Nash himself public denounced his early work due to their selffulfilling effect, and attributed them to his psychotic episode he suffered from at the time. Nevertheless many people continue to swear by it, while artificial life models or zoologist research from Frans de Waal clearly contradict the 'selfish gene' myth Dawkins and others so cherish.
What happens if someone manages to exploit quantum entanglement communication which is at least 50.000 times faster than the speed of light? Isn't retrocausal trade illegal? :-) But what's the idea? The Li formula did it? It looked like a hammer so everything needed a pounding? Like most statistics the formula looks like it needs continuous recalibration.. I thought financial trading would be much more on their way with self-organized criticality or resonant scattering from signal processing or other models from more practical areas? I'm a bit surprised that both the Li function and Black-Scholes are more akin to 19th century thermodynamics.. that is more than fine, but it was a human act that overvalued the importance. I guess praying remains the superior option for the shortterm future..
Very cool, do check out claytronics as well and magneclay This is why 3D printing is becoming so deeply interesting as a trend, there is a gradual shift ongoing in manufacturing towards general purpose production means, also due to CNC machine tools, things like paint mixers or knitting machines.. and at a certain stage, probably within the next ten years, one can compose a fully automated end-to-end assembly line of such general purpose machines which not only construct the basic material (constructed from fungible core materials) but personalized products can be as easily produced as they are designed. I'm working on a proposal to get an initial infrastructural solution for this seeded. But the possibilities that will be realized within the next decades are mindboggling. With nanotech the limitations seem to indicate a physical hurdle at a scale 10^20 smaller than the Planck scale (10^-33 cm) and recent progress with so-called quantum mirages make it possible to scratch/etch computer circuits in an atom's wavepacket.. and some experiments with quantum teleportation indicate it is possible to broadcast the results on a different scale (not just location or time) so that the problems of connecting with something so small can be resolved. This actually gives the possibility to not only assemble materials out of individual atoms, but it is also possible to carve a whole machine out of a single atom. The amazingly looking telephone from the Nokia advert would only be needed to have a tool to interface with on our size scale, but as a product it may probably not even come in existence when other production means become as flexible as software and a phone can be printed on small stickers of a square millimeter that one can stick on pieces of jewelry, a watch or even a fingernail. "Talk to the hand" will get a different meaning. The speed with which information technologies continue to crossfertilize in increased ingenuity appears to be moving at a speed which translates in an efficiency doubling every year. People consistently outwit Moore's law with a factor of two. Once an industry reaches a level of maturity where it becomes an information technology the possibilities experience a combinatorial explosion and ...
Banks, or more ideally consortia of banks, can play a much better role in the act of valuation. Of course money is not going away as an exchange medium, and much of the recent progress lies there, but i guess the case of the Eurozone says more than enough... Conceptually money is very close to a programming language, although more descriptive than instructive / prescriptive. Money as an artificial language has more or less tried to express uniform value yardstick, but it is terribly ambiguous as such.. especially for a contextualist. One euro in Italy is not the same as one euro in Holland. What banks can do, with using modern day techniques, is support the multiplicate ways of valuation, and that lies in an inversion of the current model. Using the wide spectrum of certified standards a dependency map can be constructed which essentially models the real worlds as far as commercial activity goes. The more information is available concerning the usage patterns the better interoperable interdepencies can be mapped out, as well as interchangeable degrees of freedom, with 'money' being the ultimate 'interchangeable part'. As a result banks can map out the bottlenecks in the commercial landscape and advice companies on areas in need of innovation and inventions. Even de-facto standards, such as Farmville 'farm cash' is being used already which ought at least be an indication that it has become a valid means of valuation, eventhough the goods are virtual. The Chinese government blocked the use of virtual currencies in 2009.. that should say something. Especially considering their experience with big manufacturing outsourcing deals such as Foxconn and Flextronics. This is treading on the domain of GS1 and ISO, and even Verisign, but it would be a pity to not engage on this route. It's not that banks cannot engage in increased security and defensive legal wrapping, but they should do both. Paul
Well, at least it hasn't reached the level of 'bunga bunga' yet...
Such is a very cunning plan, mr Skinner. The monetarist's money is in a sense money an optical illusion, albeit a very persistent one. With increased speed of communication and the formation of many interest-based groups spanning the globe, the economy is slowly disentangling itself from several physical limitations. The differences in these limitations, time-delay and distance, have been traditional levers for the money changing business or cultivated pawnshops, but as these differences are gradually evening out the business models based on it are becoming increasingly vulnerable. A viable way forward is to disassociate uniformity from universality, and start offering a means for certified secure interoperability of value. Money is such an accepted means, stocks and stock options are as well.. but with the continuing growth in computing power community based bartering systems can be calibrated, even brand recognition and goodwill can be measured. As you indicate, it's not so much that finance doesn't work, but a slightly more abstract, more versatile interpretation is actualizing using the advances of information technology which will gradually undermine the mediating function money has. It's going to take some effort, but as several technologies continue to show accelerated change, especially if they reach a level of adaptiveness and flexibility comparible with software such as next generation manufacturing, this may be sooner than later. Once e.g. carbon nanotubes are introduced in commodity goods making them effectively unbreakable, it is a matter of time before that is a common practise which basically puts an end to much of the planned obsolescence based market segments. Once carbon fiber stickers can be used to strengthen crummy houses, and solar cell paint is used for accumulating electricity.. these are transformational applications of technologies which already exist but are slightly too expensive for the moment. But they will end many current business model. It is only rigidity that leads to Schumpeter's creative destruction.. Banks are better off facilitating the future instead of fighting it. Take care Paul
Chris, i wasn't implying that. What i mean to say is that there is very little difference as far as these three trends are concerned. All are based on near-instantaneous transaction processing. As a consultant working on international basis trying to set up a business dealing with all the border issues are an ordeal, and eventhough there may not be a business case, for banks, to implement SEPA i do guess it is obvious that it is a vital step in actualizing the Euro. Large companies make as much use of buffering up the payment delays as banks seem to do, so the added value is to be seen in the SME segment which makes up about 60% of Europe's economy. Not hurrying up with SEPA is just 'easy money' for banks. As you say, "some think it's real value".. and i see this hollowing out on a daily basis here in Italy. Who says you can't fill a hole with another hole? Anyway, with BAM comes end-to-end visibility, and from that comes a demand for increased transparancy, which will gradually force payments to be processed in real-time, which includes SEPA.
Cui bono? Can you elaborate on the differences between "real-time", SEPA and Informatica's Complex Event Processing solution which is used for BAM? ?
Chris, The way most banks earn a living are quite simple to identify and classify using a systems approach. Most act by exploiting either item 9 (relative delays), 10 (flow structure) or 11 (relative buffer size) of the potential 'leverage points'. Sitting on ones 'ass-ets' is a form of mixing 9 and 11.. Some banks are good at 7 and 8 (positive and negative feedback loops), few at 6 (information flow structure), and an even rarer few at 5 (rules of the system itself). Of course SEPA means they can't have these 3 to 7 (or more) days of delay on payments which take less than a second to process, nor can they penalize for a multitude of lost interest for transfers done on actual days instead of 'registered'/accounting days. Having dealt with three Italian banks as a small company, i've seen all these tricks being pulled. Eventually i moved my whole business to Switzerland just to get rid of this antiquated foolishness. As you mentioned a few articles back, i think we're on the threshold of a shift in defining what money actually is, or represents, and i think we'll get a level deeper and banks will be more about information processing than anything else. One can see this on the stockmarket already how companies use marketing, careful planning of acquisitions, product launches etcetera to boost the value of their stock, and even create positive feedback loops around their 'brand'. But it is also apparent with the 'geo-location' dependent cost of living schemes, which sometimes give a surprisingly different picture than what the currency represents. I guess that's the whole trouble with the Euro or even national governmental schemes.. they don't fit the actual social and geographical distribution of the economy, and because we're inside a technological acceleration where non-realtime processing becomes irresponsible, we're cutting away the delays and buffers which use to hold it all together. But we have to.. it is intrinsic of the capitalist system we're involved with. The German Euro is not the Italian Euro.. nor is the governmental Euro the same one as i use at the local supermarket. Eventually we'll be dealing with different temporary forms of valuation, as you already foresee with the rise of social currencies which is an appearance of these information processing ways. So, i think the future of banking lies in the act of valuation, where it started.
SEPA matters for all the SME that work, or want to work, on an international basis. Shorter payment cycles, real time processing and low fees are all good for the tangiable part of the economy. More transparant cross-border payments build trust and glue disparate economies together. The navelgazing protectionism apparent in these discussions is nice, but what sense does it have to have an EU that is slowly dying of rigidity?
Most managers are choosen for their skills akin to those of a warehouse keeper, not for being thoughtleaders. There is so much talk about innovation, yet still "excellent things are rare" especially when innovation primarily remains a marketing effort. Of course i'd like to see more 'socially responsible' behaviour, but who is to decide what that is? Politicians? Money is *the* universal trade commodity, woven into the infrastructural fabric of commerce and society. Beyond currency differences and other means of valuation, it means dealing within an oligopolic market segment, at least within it's own region. And within that regional market it is quite simple to differentiate using one of several known leverage points. Disturbing the force is not in a bank's best interest, eventhough with todays information processing technologies, we can effectivelly go a level beyond currency and even make this world a little better, but cui bono?
Happy happy joy joy? Amazing how we can envision such advanced and complex technologies and then mold them into a rather cartoonesque socio-economic model.. Supply defines demand to a very high degree. Maybe, if we look at it from a business intelligence angle, things are much more in line with Citigroup's plutonomy memo, and most of a bank's customers are more akin to articles than to being their clients. As most things go, that is just an accidental result of not having a clear policy stimulating the contrary. Now that the communication infrastructure, the internet, is becoming such that communities are becoming a reality, and the multichannel predictions have indeed happened but in not in a regulated way, as proposed, we are reaching a phase where the cost/revenue ratio for a mature multichannel strategy will likely pay off. A more involved, cost efficient and re-humanized form of 'involved' service will surely highlight any bank from the amorphous grey most customers mistake them for, and with a little help gravitate them towards them, but it'll likely involve a certain degree of Schumpeter's creative destruction for banks to get moving. Very much agree though, in the long run.
I very much agree... Tho i would like to stress that the difference between national and regional does not equate to the difference between public and private. But then again, the latter does not equal transparancy and obfuscation.. Internationally linked anarcho-syndicalist cooperatives worked very well and it had the right socio-economic granularity to be efficient on both geo-political scales without the need for a national arrangement. I think the banking world has an opportunity here to expand or wither away.
".. the hydrostatic paradox of controversy. Don't you know what that means? Well, I will tell you. You know that, if you had a bent tube, one arm of which was of the size of a pipe-stem, and the other big enough to hold the ocean, water would stand at the same height in one as in the other. Controversy equalizes fools and wise men in the same way. And the fools know it." - Oliver Wendell Holmes it is foolish to manufacture consent..