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7 Replies
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Re: Thank heaven for REC's

Don't you WANT all forms of energy to be more expensive to decrease usage? Jeez some people are never happy.
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Re: Thank heaven for REC's

Where do you come up with some of your presumptuous assertions and generalities?
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Re: Thank heaven for REC's

I've been picking my way through Flash Boys a chapter at a time before falling asleep.

 

Some similarities between HFT and predatory electricity arbitrage.  In both cases they are products of the revolution in computers and date transmission- in HFT it is obvious and also in the power markets where you couldn't come close to being able to play that game without vast monitoring and routing capability.

 

The power game even has a better ostensible rationale- it does make sense to use the market to move power around, the question is whether it is possible to monitor the transactions or write regs that are capable of keeping the smartest best equipped guys from skimming it.

 

No justification whatsoever for HFT, they will argue that it adds liquidity but the purpose of liquidity is to make markets run better. When there is an outbreak of extreme volatility the HFTs are nowhere to be found or are adding to it. That was Bill Gates' recent comment on the matter.

 

Both do contribute to "the economy" by some measures. Freer power markets have led to building peakers and other assets. In HFT, literally $billions have been spent on equipment used solely to play the game (which leaves you wondering about the size of the payoff) and the engineers and folks farther up on the food chain are employed, pay taxes etc.

 

But both are, nevertheless, totally unproductive predatory actions.

 

It really leaves me despondent as I observe the passionate intensity of both sides of the foodfight over a list of largely manufactured differences. 

 

Mixing metaphorical quotes, I think it is a sign of Tainter's description of collpase in complex societies- diminishing returns on increasing complexity.  But also as Adam Smith said, "there's a lot of ruin in a nation."

 

 

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Re: Thank heaven for REC's

TPM
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Advisor

Re: Thank heaven for REC's

PS. If there's a central vein to be mined out of current conservative populist revolt it is no doubt a matter of resistance to the ever increasing complexity with government viewed as the primary agent. Actually I think both examples indicate that government is simply both partially captured and much slower to adapt than the gamers.

 

In regards to financial regulation, we have a pretty good historical example of the end that unfettered markets run to via the '29 crash and subsequent depression.

 

Although it only adds to my despair to note that in one history curriculum for Christian high schools that isn't what happened at all, it was a conspiracy by socialists that brought all of that about.

 

We are sooo **bleep**ed.

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Advisor

Re: Thank heaven for REC's

On the electric deregulation matter, it is an example of why I've looked at carbon cap and trade with a jaundiced eye. I can't help but believe the smart guys wouldn't just game it.

 

And as to Al Gore, the public face of the concept, can't help but see him as equivalent to Gramm or Leach on financial regulation- found some interest, some money and the opportunity to sound like smart guys and deliver the deal.

 

Oh, did I mention that we're **bleep**ed?

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Advisor

Re: Thank heaven for REC's

Von Mises Institute.