Running out of options

Fascinating piece in Slate.

At 7.32pm on March 27, Dama Mattioli, a reporter on the Wall Street Journal, tweeted thus:

“Intel is in talks to buy Altera. Deal would be largest in Intel’s history. Scoop w/ @danacimilluca coming to $ALTR”

Seth Stevenson of Slate recounts what happened next:

Quicker than any human seemingly could have done it, someone—or rather something—bought $110,530 worth of cheap options on Altera, a company that makes digital circuits.* Over the next several minutes and until the end of the day, as humans digested Mattioli’s takeover rumor at human speed, Altera’s stock price rose. When all was said and done, those cheap options had resulted in a $2.4 million profit. Speculation immediately centered on the idea that an automated program (a “bot”) had scanned the tweet, interpreted its meaning, and instantly bought those options based on an algorithm. The robot had read the tweet and made a killing on it before anyone knew what was going on.

In fact a Reuters report found that the trade in question was made a full 19 seconds before the tweet appeared. In a way, though, that only makes the story even more interesting. The WSJ has a policy of putting news on its own newswire before it goes on Twitter and it turns out that the trades occurred a mere second after news of the possible deal appeared on Dow Jones Newswires, and before Altera’s shares were halted.

Yep. A second.

Which means — or at any rate suggests — that an algorithm ‘read’ the news headline and acted to buy short-term options on Altera shares. Which is yet another pointer to what it happening to stock exchanges.

Privacy: who needs it? Er, Zuckerberg & Co

Who said irony was dead? The tech zillionaires are so blasé about how their users are relaxed about privacy and what is quaintly called “sharing”. But they are not at all blasé when it comes to sharing information about themselves. Google’s Exec Chairman, Eric Schmidt, for example, believes that “privacy is dead”, but went apeshit when some enterprising journalist dug up lots of personal information about him simply by using, er, Google.

And then there’s young Zuckerberg, the Facebook boss, who is likewise relaxed about other people’s privacy, but paranoid about his own. See, for example, this Forbes report on his need to buy up an entire neighbourhood block in palo Alto to ensure that he isn’t overlooked:

So much for Zuckerberg only making a big digital footprint. Now the online empire maker owns nearly an entire neighborhood block, just because he can.

According to property records, the Facebook CEO has spent $30 million over the past year buying the pricy homes of four of his neighbors. It’s within his right, and within his budget, especially with Facebook stock finally starting to march up in value after its controversial and lackluster IPO.

Now the NYT is reporting that he’s updating a house in San Francisco, where even he might not be able to persuade his neighbours to clear out. But builders and tradesmen working on this nouveau palace find that they have to sign Non-Disclosure Agreements lest the world should know which kind of bidet the infant zillionaire favours.

Newspapers need editors, not ‘Directors of Content’

Great piece by Peter Preston about the ethical shambles at the Daily Telegraph. Sample:

It’s easy, in such murky circumstances, to lose sight of basic command structures. Much of Fleet Street, indeed, has planted “content” and “strategy” nametags across its digital garden. But the grisly lesson of HSBC is also a fundamental one.

Title inflation may make a paper look cutting-edge digital. It may impress advertisers and investors. It may seem a modern necessity in a world of “native advertising” and fast-flowing revenue streams. But serious newspapers, in whatever form, have a duty of trust: a duty not to be leaned on by pushy politicians, chummy bankers – or advertisers. For how can you put truth first if the truth is for sale?

That’s why the Oborne storm is so deeply damaging. It can’t be put right by appointing some “chief integrity officer”. What the Telegraph lacks, as it stinks and stings under pressure, is what it must now rediscover: a journalist who looks at the likes of HSBC and tells them to get stuffed as and when necessary. A human being, not a corporate assassin. An editor.


ALSO: This from Roy Greenslade:

According to Oborne, at a meeting with MacLennan, the CEO was unapologetic about the matter, suggesting that it was no big deal. But it is, of course. It is a very big deal indeed because it goes to the heart of a paper’s credibility. Readers will not trust a newspaper that withholds or censors stories to please advertisers.

Everyone in the newspaper industry knows that advertising is harder and harder to come by. We know also that TMG has been reporting a level of profits for several years that surpasses any other national group. How, we wonder, does it do that?

The implication of Oborne’s revelations is that part of its strategy involves pandering to big advertisers to the extent of curbing critical editorial content.

I imagine this is rare, but once one company gets away with threatening to pull its advertising unless negative stories are pulled then the word goes round. It opens the door to discreet deals. So other instances may have occurred that we know nothing about.

Oborne felt that the HSBC case was so blatant that it was impossible to ignore and it could have far-reaching implications. Frankly, I’m amazed that MacLennan would be party to such activities.

Many people throw mud at him, but there are very few newspaper managers who love the company of journalists as much as he does. He and I have fallen out several times down the years, but I haven’t lost my regard for him. This matter, however, is of a different order altogether.

So what happens next? One theory going the rounds is that the Barclay twins, the owners of the Telegraph, have decided that the way to extract the most value from the paper is to let it go the profitable way of pandering to advertisers, on the grounds that it might last another ten profitable years before it finally collapses under the weight of its own absurdity. So it’s possible they’re not unduly bothered by the fuss about “ethics”.

The Telescreen is here

Thinking about getting a ‘smart’ Samsung TV? Think again.


Thanks to Hannes Sjoblad for the tweet.

Footnote: In Orwell’s 1984 there was a ‘telescreen’ in Winston’s apartment.

“Any sound that Winston made, above the level of a very low whisper, would be picked up by it, moreover, so long as he remained within the field of vision which the metal plaque commanded, he could be seen as well as heard. There was of course no way of knowing whether you were being watched at any given moment. How often, or on what system, the Thought Police plugged in on any individual wire was guesswork.”

Who breaks a butterfly upon a wheel?


That line from Alexander Pope came to mind time and time again last night as I watched a marvellous Storyville film about the short life and tragic death of Aaron Schwartz. At the end, I was left with the same mixture of anger and despair that I felt when news broke of his suicide, hounded to his death by a vindictive and disproportionate prosecution by the Feds for organising a massive download of scholarly articles from JSTOR.

I never met him, but I followed him through his writing and his work from the first time he surfaced on the Net. I vividly remember his blog posts about his reactions to Stanford, especially the way he tried to figure out why the world (and specifically that particular corner of it) was so weird and dysfunctional. And every day I use Markdown and RSS, two of the tools he helped to create. So like legions of others, I am in his debt.

I knew most of the story of his life. He and I shared a mutual friend (who was truly heartbroken by his death). What I hadn’t known — and the film revealed — was what he was like as a very young child. And the truth turns out to be that he was remarkable from the very beginning, one of the brightest, most engaging toddlers I’ve ever seen.

Perhaps the most impressive aspect of the film was the way it managed to be deeply moving without being sentimental: that’s a hard balance to strike, but the film-makers pulled it off. In the end, as I said, it left one with a burning sense of injustice and anger. Two things stand out. The first is the hypocrisy of an administration (Obama’s) which vindictively pursues this idealistic young genius while failing to prosecute the criminals who wrecked the banking system. And secondly there is the thought that the real significance of Aaron’s treatment is that it heralds a future in which the established order will do whatever it takes to suppress uses of the Internet that challenge it. Aaron was, after all, well on his way to becoming a powerful political activist.

Mad Max rides again

As I was saying, now is the time to keep our heads. Max Hastings, alas, has lost his:

Our principal weapons against terrorists are not tanks, Typhoon fighter jets or warships, but instead intelligence officers using electronic surveillance.

Much cant has been peddled recently about the supposed threat to liberty posed by government eavesdropping on our lives.

Such people as WikiLeaks founder Julian Assange and Edward Snowden (the former U.S. National Security Agency contractor turned treacherous fugitive), who have broadcast American and British secrets wholesale, are celebrated as heroes by some people who should know better, many of them writing for the Guardian or broadcasting for the BBC.

In truth, Assange and Snowden have damaged the security of each and every one of us, by alerting the jihadis and Al Qaeda, our mortal enemies, to the scale and reach of electronic eavesdropping.

Eh? As Caspar Bowden tweeted, “culprits of Paris, Woolwich, Boston not just all known to police, already jailed/ wiretapped for terrorism, or failed double-agent recruits”. So where does Snowden come into this? Answer: nowhere.

Ye olde reality distortion fields

The strangest thing about Downton Abbey, the reality distortion field masquerading as costume drama, is not that it has been captivating British audiences — for the Brits are congenitally susceptible to this kind of class-ridden crap — but that it is apparently a big hit in the US, which supposedly is a more egalitarian, less deferential society.

Also interesting is the coincidence that — as Thomas Piketty has shown — levels of inequality in the US are now approaching what they were in Britain when Downton Abbey was in its heyday. Wonder how many of those addled American Downton addicts realise that?

Imbecility rules ok?

Appearances notwithstanding, we are not governed by imbeciles. Our problem is that we are governed by unscrupulous politicians who see imbecility as the way to the voter’s heart. Step forward Theresa May, the current Miss Whiplash of the Tory front bench, who wants a solemn commitment in the next Tory Manifesto to expel all foreign graduate students after they graduate and make them apply from abroad for visas to work in the UK. Yes, you read that correctly. She wants to force bright young foreigners, who come to do research degrees in the UK because we have some great universities, to leave the moment they become available for work in our knowledge-based industries.

Here’s how James Dyson, the entrepreneur and inventor puts it:

Train ’em up. Kick ’em out. It’s a bit shortsighted, isn’t it? A short-term vote winner that leads to long-term economic decline. Of course the government needs to be seen to be “doing something”. But postgraduate research in particular leads to exportable, patentable technology. Binning foreign postgraduates is, I suppose, a quick fix. But quick fixes don’t build long-term futures. And that’s exactly what many researchers are doing.

Bright sparks are drawn to the UK for good reason – our universities are among the best in the world. Particularly for science and engineering. Yet the Home Office wants to say cheerio to these sharp minds as soon as their mortarboards land on college lawns. The moment research is finished students are forced back to their homelands, from where the home secretary is happy to allow them to apply for jobs in Britain. Not exactly motivating. Not exactly practical. This is an abrupt departure from an equally unworkable idea that after their research they have two months to be employed, otherwise they are ejected. No wonder fewer than 10% bother to try to stay.

Our borders must remain open to the world’s best. Give them our knowledge, allow them to develop their own and permit them to apply it on our shores. Their ideas and inventiveness will create technology to export around the world.

The interesting question, of course, is why Miss Whiplash thinks that her daft policy idea will be a vote-winner in a closely-fought election? The logical inference is that she thinks that voters are imbeciles. In which case she is following in the footsteps of one of her heroes, Winston Churchill, who famously observed that “the best argument against democracy is five minutes’ conversation with the average voter”.


How the unthinkable becomes thinkable

From the Christmas Edition of the New Yorker:

It’s hard to describe it as a positive development when a branch of the federal government releases a four-hundred-and-ninety-nine-page report that explains, in meticulous detail, how unthinkable cruelty became official U.S. policy. But last Tuesday, in releasing the long-awaited Senate Select Intelligence Committee report on the C.I.A.’s interrogation-and-detention program, Senator Dianne Feinstein, the committee chairman, proved that Congress can still perform its most basic Madisonian function of providing a check on executive-branch abuse, and that is reason for gratitude.


The report also demonstrates that the agency misrepresented nearly every aspect of its program to the Bush Administration, which authorized it, to the members of Congress charged with overseeing it, and to the public, which was led to believe that whatever the C.I.A. was doing was vital for national security and did not involve torture. Instead, the report shows, in all twenty cases most widely cited by the C.I.A. as evidence that abusive interrogation methods were necessary, the same information could have been obtained, and frequently was obtained, through non-coercive methods. Further, the interrogations often produced false information, ensnaring innocent people, sometimes with tragic results.

Other documents illustrate how the agency misled. In June of 2003, the Vice-President’s counsel asked the C.I.A’.s general counsel if the agency was videotaping its waterboarding sessions. His answer was no. That was technically true, since it was not videotaping them at the time. But it had done so previously, and it had the tapes. The C.I.A. used the same evasion on Senate overseers. A day after a senator proposed a commission to look into detainee matters, the tapes were destroyed. Similar deceptions on many levels are so rife in the report that a reader can’t help but wonder if agency officials didn’t simply regard their cloak of state secrecy as a license to circumvent accountability.

So, will anything change?

It remains to be seen, though, whether the report will spur lasting reform. Darius Rejali, a professor of political science at Reed College and an expert on torture regimes, doubts that it will. For one thing, despite McCain’s testimony, torture is becoming just another partisan issue. This wasn’t always the case—it was Ronald Reagan who signed the U.N. Convention Against Torture, in 1988. But polls show both a growing acceptance of the practice and a widening divide along party lines. “It’s becoming a lot like the death penalty,” Rejali said.

All of which brings me to our current ‘debate’ (such as it is) about online surveillance. It’s interesting to see how affronted contemporary officials and government ministers become at any suggestion that the agencies are not behaving ethically or even legally. The response is to assert indignantly that such behaviour is unthinkable and that it is outrageous even to hint that some officials might behave badly.

Which makes me wonder if all these righteous protesters are either in denial or suffering from a bad case of collective amnesia. It’s not so long ago, for example, that the senior ranks of MI6 harboured a nest of Soviet spies. And I can’t think of a public or semi-public agency in recent years — the BBC, the Metropolitan Police, the Press Complaints Commission, the South Yorkshire police force, the Care Quality Commission), the Catholic church and MPs to name just seven — that has not done things or condoned behaviour that, when exposed, has been deemed unthinkable, unethical or incompetent.

Given what we now know about the recent history of our institutions, it seems statistically improbable that analogous malefaction is not going on in their contemporary equivalents. At any rate, it seems to me to be the most rational default assumption. Why should we believe any assurances from public or corporate spokespersons any more?