Whenever I see posts from Janestreet blog I laugh inside thinking how working on the financial industry at Jane is probably more fun and rewarding than some 90% of the jobs in the so-called tech industry.
Jane Street and a handful of few other elite shops make up a tiny percentage of the finance industry’s tech workforce though.
There are a ton more people working in tech in finance that don’t quite have it as fun (or lucrative) as Jane Street let alone your average tech company.
OP should've been more specific. HFT firms, not any other finance companies, probably have a lot more exciting work due to the nature of reducing latency using all sorts of novel techniques.
I wonder if they disable all the fancy exploit mitigation protection in linux kernel just for a tiny performance hit
Mother capitalism deems that our brightest young minds best serve humanity in two tasks. Keeping the public passively scrolling, and moving money at speed to make wealthy people more wealthy.
Actually, not. These market makers are often prop shops. That means they use their own fund (prop = proprietary) to do the trading. They can do that because they don't need much capital to run.
So the story here is that over the last twenty years they stole the lunch from the traditional market makers like eg banks.
Of course, they got rich in the process. But they started from relatively modest means, compared to the companies they took on.
Michael Lewis's 'Flash Boys' is an hilarious account of this process. Well, it's involuntarily hilarious, because to tell his story, Lewis needs to cast Goldman Sachs (!) and other big banks as the victim. See the rebuttal 'Flash Boys: Not so fast' by Peter Kovac for more insight.
Perhaps some start this way. But in terms of the general trend of talented engineers and mathematicians being sucked into this quant vortex, it is a matter of making wealthy people wealthier.
Automation in trading makes all investors wealthier via lower fees. Trading costs basically nothing nowadays, and that is because far fewer people are employed to do it.
Obviously, the people who own the automation will want a cut of the rewards, like any other business.
Obviously NASDAQ and electronic trading systems are a good innovation. But firms basically doing arbitrage or exploiting uneven network latency are not that economically productive.
Well lowering market spreads is all about increasing the returns for capital, and incenctivising overfinancialisation. It's hardly curing cancer is it?
At worst it's actively harmful if you believe that the current state of turbo-financialised capitalism has its drawbacks.
> Network latency
Not really sure what you're talking about but surely spending billions of dollars to bring rtt latencies to 50 micros or whatever is not really a great use of money and top engineering talent. Again, it's playing an arbitrage game but not really delivering any value.
lol I said "closeted dictator" for the record. But alrighty why don't we start over and see if we can both argue in good faith. I can certainly be a dick on the internet sometimes.
I honestly can't tell what your concrete points are. I come from the position that economies are naturally occurring phenomena which cannot be centrally planned or controlled. If people can find ways to profit off market inefficiencies, they should! The HFT/Quant firms make their arbitrage money (value for them) and all market participants in return see: (non-exhaustive list)
If your bar is that "all smart people should be working on curing cancer or andrepd-approved endevours" then almost nobody in the economy is providing value. Is my lowly SecEng job at $MEGACORP good enough? What about my buddy who writes firmware for toothbruhes? Are professional starcraft players wasting their talents?
> EDIT: The funny part is even the exchanges and hft firms agree with me see PLP/speed bumps on exchanges like Eurex lol
This debate has been going on for ages, and it's silly to pretend that it's been settled and everyone agrees with you.
> I come from the position that economies are naturally occurring phenomena which cannot be centrally planned or controlled.
This is a challenge to untangle. It sounds like you're saying that there is no point trying to regulate, legislate or control what happens in the economy at all. But that sounds bonkers to me.
For starters, there are (and should definitely remain) absolute limits to business activities. We've moved on from Victorian-era child and slave labour for good reasons, even though such a situation was "naturally occurring" at the time. Moreover economic activity is dictated by cultural mores - if your service is morally reprehensible in some way then you won't get much business whatever your matgins are. Economies are inherently subject to the laws and customs of the agents.
Secondly, some regulation is pretty clearly beneficial. For example, there's a recurrent tendency for market power to concentrate in modern economies; we need robust anti-trust regulation to prevent consumers from getting ripped off and to prevent fragile supply chains. A well-conisdered balance of public and private provision supports the least well-off in society while allowing room for the fruits of individual flourishing.
Thirdly, we must consider what makes one economic system better than others. One way to measure this is to look at how efficiently it converts resources to social utility. I'm far from convinced that it's efficient to employ our brightest minds to build trading models with brief lifespans so that investors who are already well-off become slightly more so. It's worth investigating what regulations and incentives could put those minds towards things of greater value - solving climate change, cancer, sending humans into space etc... .
> This is a challenge to untangle. It sounds like you're saying that there is no point trying to regulate, legislate or control what happens in the economy at all. But that sounds bonkers to me.
I really do not appreciate this mischaracterization of my position. Focus on my actual words. I don't care about 'winning' this online argument. I take effort to engage because I am disturbed by the number of intelligent people who believe if only _THEY_ were in charge (or at least the right person), we would be able to fix all of society's problems.
> For starters, there are (and should definitely remain) absolute limits to business activities...
I agree with everything that follows. Government needs to be around to keep the peace. I want to be explicit: When I say "centrally planned/controlled economies" I am NOT talking about the general concept of regulation. If you are debating in good faith, this should be obvious. Look at all the history of failed states who tried to implement top-down control of their economies.
Also, YSK that not all regulators are government entities.
> Thirdly, we must consider what makes one economic system better than others. One way to measure this is to look at how efficiently it converts resources to social utility.
Never before in history has mankind been so prosperous. What system would you like to emulate? The US capitalist system is not perfect (and never will be)...but it blows all of its peers out of the water in terms of economic prosperity. Here's a couple data points: (Please read the technical definitions if you are truly interested in this subject)
> I'm far from convinced that it's efficient to employ our brightest minds to build trading models...
This is where my "closeted dictator" quip comes from. Nobody is "allocating" these minds...they are acting on their own free will. Why should you or anyone else be the arbiter? What if individuals disagree with your beliefs? Space exploration is a great example of a debatable "worthy endeavor"
Do you mean that high salaries indicate a demand in the market? Not much argument there, although it is sometimes the case that large companies hire talent purely to starve competition. But what I'm really questioning is whether those high salaries translate to value to society.
Some fraction of young minds, not all. I was happy to work at a small aerospace company with extreme concentration of brightest minds. Only because they loved the domain, and didn't mind a salary cut. What a joy and relief it was for me after FAANG!
No, I eventually left because money, I needed to save for a house.
Most of the staff were locals, so already had own/inherited property to live in. After FAANG it was new to work with mostly locals, way more stories about the surroundings.
Absolutely. The moral aspect is certainly questionable. Although, I wouldn't say "all brightest minds" are going to neglect their moral concerns for getting rich
To be honest, even this is morally questionable. It makes superficial sense in that someone else will do the work if you don't. But this happening on a large scale is still a drain on talent that could hopefully be used for work of greater social value.
Is the problem with the system or with the minds? The minds that want to scroll are the same as the ones that make money on the scrolling, that made the scrolling itself, and that made the system we're in. Why is it that defeatist comments always focus on the capitalism part and not on anything else? I don't think it's perfect like we aren't perfect but unless you have some particular suggestion this type of comment just reads "boohoo the world is bad and it's not my fault".
> Why is it that defeatist comments always focus on the capitalism part and not on anything else
Because endless growth is the only reason these once fun spaces have been hyper focused to be as addictive and stressful as possible to the "whales" of scrolling. That's why, when their own internal reports say "people spend unhealthy time on our platform and it's making them unhappy," it gets passed up the chain of command and whittled down by internal incentives until it dies as an issue.
Individuals hold some blame, but to put most of it on them is to ignore what growth demands. You're supposed to doomscroll and engage and worry. That's the business model. Facebook is in the same business as Cigarettes and Casinos. When I see someone on an air tank playing slots, literally crying when they spend their last dollar, I will not waste my breath blaming them. Just like I won't blame the doomscroller, anxious that they need to stay "informed," who hasn't met the basic needs in their own life.
> The minds that want to scroll are the same as the ones that make money on the scrolling
No? Where are you getting this? I don't think the people guiding these companies want to spend 6 hours scrolling TikTok. This is not the way most people live their lives.
> No? Where are you getting this? I don't think the people guiding these companies want to spend 6 hours scrolling TikTok. This is not the way most people live their lives.
I meant they are all humans. We're all sort of the same. If you disagree just think of your opinion of any other species, or about a group of people a thousand years ago, and you see what I meant.
Would they also change the aliasing assumptions to something close to C/C++? Otherwise I imagine it would be relatively easy to make mistakes and get "surprises" at runtime thanks to the optimizer.
Anecdote which doesn't prove anything but I have a colleague who left JS to work in FAANG after 6 months because working there was just too boring in his opinion (despite a higher salary).
Also, it's apparently significantly harder to land a position at JS than at a Google/Meta.
Actually, I applied there a while ago, the interviewer was actually pretty unpleasant, which hasn't happened to me at big tech. Didn't leave a really good impression.
Yeah I sent an application on a whim because I've spent a lot of time in FP land professionally and otherwise, I figured "what the heck, maybe they'll see value in that," and I was surprised to actually get a response but it was dismissive and borderline insulting..."there's nothing relevant here" talking about my resume is the thing I remember the most.
It was probably the first and only time I would have rather have been ghosted lol
Is it? Hours are long and the standards are very demanding, and in the end you're just manipulating numbers for profit, so that's not (for most people) a very meaningful endeavour.
I still rank it above making people click on ads though.
People really over hype and overrate what kind of work happens at Jane Street or similarly exclusive HFTs. They have their mix of interesting projects and mundane work like any other company.
Maybe, but could you live with the fact that you're providing absolutely no value to the world? It always makes me sad when the greatest minds get gobbled up by these companies because they're creaming off the top of an enormously complex system they created.
As someone that used to work in this world I find this opinion of “no value” pretty bizarre. There’s a lot of value in efficient markets with high liquidity and low fees, which companies like JS make possible.
Capitalism is the best system we humans have come up with at this point in civilisation, for all its flaws. It’s largely responsible for the technological, medical, and quality of life advances in the last 150 years.
Please tell me a better system that would cure cancer. I don’t think it’s Leninism or its derivatives. You need a macro system that is rich enough to allow for significant investment in medical research.
Having worked in both, there is a huge number of really smart people who turn down offers to work in quant shops. And people really underestimate how much tech will pay top researchers/overestimate how much the average quant makes.
I did work in the industry briefly and can confirm it is actually full of people who would post a comment like this. Just in case anyone needed another reason to avoid it!
Work on real problems. Try to make real people's lives better and happier. There are real problems in finance but my feeling was it's all very simple and solved decades ago, now it's just pointless complexity that isn't solving anyone's problems. I recommend John Kay's Other People's Money for a primer on what finance is actually good for and where it's gone wrong.
The real big problem in finance IMO is digital cash. Bitcoin started out trying to solve that problem, and there are still some people in the community interested in it, but it's mostly of interest to the finance guys now. Just another "instrument" in their "portfolios".
> Work on real problems. Try to make real people's lives better and happier. There are real problems in finance but my feeling was it's all very simple and solved decades ago, now it's just pointless complexity that isn't solving anyone's problems. I recommend John Kay's Other People's Money for a primer on what finance is actually good for and where it's gone wrong.
If the last few years have taught me anything it's that a large % of the population will actively aim to make their own lives worse long term because they are told lies. What benefit is there really in trying to undo their own self-inflicted damage.
