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Robotics AI Businesses

Will Robots Wipe Out Wall Street's Highest-Paying Jobs? (bloomberg.com) 71

An anonymous reader quotes Bloomberg: Robots have replaced thousands of routine jobs on Wall Street. Now, they're coming for higher-ups.

That's the contention of Marcos Lopez de Prado, a Cornell University professor and the former head of machine learning at AQR Capital Management LLC, who testified in Washington on Friday about the impact of artificial intelligence on capital markets and jobs. The use of algorithms in electronic markets has automated the jobs of tens of thousands of execution traders worldwide, and it's also displaced people who model prices and risk or build investment portfolios, he said.

"Financial machine learning creates a number of challenges for the 6.14 million people employed in the finance and insurance industry, many of whom will lose their jobs -- not necessarily because they are replaced by machines, but because they are not trained to work alongside algorithms," Lopez de Prado told the U.S. House Committee on Financial Services.

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Will Robots Wipe Out Wall Street's Highest-Paying Jobs?

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  • I can only hope so (Score:4, Insightful)

    by DogDude ( 805747 ) on Sunday December 08, 2019 @12:41PM (#59498216)
    If there are any careers that don't add anything (much) to society, it's finance jobs. They're just parasites, taking a percentage of other people's investments. Good riddance. Maybe these people can all find work in Amazon warehouses.
    • This will never work. How can you train a robot to drink coffee and play golf?
      • If anyone actually cared to do it, it would just take a few million dollars of R&D to build a robot that would play golf better than any human eve could.

        Having the robot pour coffee from a cup into an internal reservoir would be trivial at that point.
      • A lifting arm and a funnel for the former. Start with a modern golf computer game for the latter.

    • Re: (Score:1, Troll)

      Ah, I see: so what you're saying is that you have 100% comprehensive understanding of All Things Financial and are independently wealthy from trading stocks and making investments without any help from any other human being in the financial industry? So you have a backbone-level 100Gb/s Internet connection direct to your house, so you have the lowest latency possible, so all your trades happen with split-second precision, and your 'house' is a server farm full of the highest speed computers money can buy (f
    • In their simplest forms, hedge funds are a good thing & arguably necessary, e.g. they allow farmers to get a predictable price for their crops several months down the line. Insurance is also useful to make sure that people get appropriately compensated for others' misdeeds or accidents.

      I think the problem is what successive Democrat & Republican administrations have pursued an ill-informed & dogmatic approach to deregulating the financial services sector. They've let the gamblers into our civili

    • If you think the parasites are the workers in the jobs being lost, I've got some real-estate in Florida for sale that I think you'll find very interesting. The prices charged for the services have nothing to do with the costs incurred providing them, this will just increase the profit margin for Goldman Sachs, Merrill Lynch and the rest of them.

      P.S. You can get reasonably low fees today by investing with Vanguard.
  • Regardless of your opinions on Wall Street I suspect most people would agree that the people who work there are capable of doing other jobs. Regardless of whether you think they’re geniuses or just con men pretending to be so, they could be doing something else with their labor. This is the polar opposite of cases where the lowly ditch digger is automated out of the job and incapable of finding other employment.

    Even if your inclination towards thinking “good” is more out of schadenfreud
    • Re:So what? (Score:5, Insightful)

      by religionofpeas ( 4511805 ) on Sunday December 08, 2019 @12:48PM (#59498234)

      the people who work there are capable of doing other jobs.

      If these other jobs are similar enough, they'll probably disappear too.

      • There’s a difference between a job and the extensive training it requires and the ability to learn new skills and apply what you’ve already learned to new situations. There are plenty of people I know in programming jobs that have no formal education in computer science. For them it was just a matter of learning a programming language to leverage the critical thinking and problem solving skills that they’d previously attained as a result of their education or in practicing their previous v
        • Re: (Score:2, Interesting)

          by rtb61 ( 674572 )

          If you don't have a coder brain, no matter how much you train, you'll still be a shite coder. Those people were bean counters pretending there was more importance in counting beans than in planting and harvesting them, they are pretty useless. Sure they can try for other jobs but they will be competing against others who have already spent years training and it was their original preference, their mind bent that way and those bean counters will simply not be able to compete and the lot of them to become low

    • I am not sure about your contention, the wall street guys can do other things. They are used to being paid enormous amount of money for little work and no risk. They can't pull a regular HR job.
      • by ranton ( 36917 )

        I am not sure about your contention, the wall street guys can do other things. They are used to being paid enormous amount of money for little work and no risk. They can't pull a regular HR job.

        You must have never actually worked on Wall Street. I work in the Chicago-land financial industry, and the people making enormous amounts of money are insanely hard working. Their work-life balance is often very poor, and most of the top paid directors at my company are divorced primarily because of never having time for family. I would agree with them taking fairly low levels of risk though, especially when compared to their return on that risk.

        They would have no trouble getting sales jobs in any industry,

        • They would have no trouble getting sales jobs in any industry, but most of them would have to get used to far less compensation. I doubt too many people will bat an eye when they are struggling to make $200k a year though.

          That's kinda the point. There aren't other jobs that will support them in the manner in which they are accustomed. Many probably have much more than 200K per year alimony payments.

  • When you run a business, you always want to find the most efficient way to run your business. Humans make mistakes in incredibly different ways. Computers make the same mistake over and over. Which is harder to fix? This system is central to how our system works.

    All of these achievements have taken the vast knowledge of the human experience and compressed it into algorithms. Corporations work hard to centralize their knowledge and wealth and power. Should they reap the interest built off of socie

  • Will 100% of the population be unemployed and destitute while robots run the planet with no consumers to drive the economy? Obviously not. At that point where an underground barter economy is larger than your official economy you turn the robots off.

    More realistically robots, computers, deep learning, and eventually AI will either allow fewer people to do the same amount of work, keeping production flat. Or it allows the same number of people to do more work, which is kind of the point to industrialization

    • by godrik ( 1287354 )

      Honestly it's tough to imagine most of these financial sector jobs as any form of "production". Perhaps I'm being overly generous above.

      While I understand the feeling. They actually do enable exchange of good and services. When they enable the mortgage on your new house, they also enable the construction of the house itself which is a production. As such they reap some of the benefits.

      A similar argument can be made about venture capital activities.

      Then IPOs, shorting, and stock exchange in general are the pricing mechanism. And in that sense what they do isn't that different from the work done by kelly blue book.

      But I understand the feeling

  • that aren't the guys making the robots are salesmen. Their job is to get you to buy stocks. It's one of the dirty secrets of Wall Street that your Stockbroker isn't there to help you buy, he's there to make you buy.

    Automation in Wall Street won't kill these kind of salesmen, but the more broad trends in Automation might eliminate so many middle and upper middle class jobs that the Salesmen no longer have anyone to hock their wares to. With Automation The King doesn't need merchants, and the 1% will have
  • by mschaffer ( 97223 ) on Sunday December 08, 2019 @01:07PM (#59498288)

    No need for robots. Computers have been doing this for a while now.

  • So when there is a discussion about computers taking well paid jobs from people, i'm assuming the suggestion is that traders are being replaced, and yes, that is certainly the case. However, traders are being replaced by CompSci types, writing Algo Trading systems. It's just one set of people skills being replaced by a different set.

  • It's a big gravy train leaching off of pensions and savers anyway. If these peoples jobs start going 1st then maybe jobs might actually be protected from being replaced by AI.

  • ..Wall Street's Highest-Paying Jobs?
    No. </subject>

    MEMO TO MEDIA: FFS I know there a slow news days, but could you just stop trying to stampede the herd by trolling them with the 'robots will take all our jobs' bait, please? It's tedious.
  • by clawsoon ( 748629 ) on Sunday December 08, 2019 @01:40PM (#59498366)
    The highest paid jobs are about the distribution of power. Those jobs may change, but they will not go away, unless the distribution of power via the distribution of capital itself goes away.
  • It would be a pity to get rid of the only people in Wall Street making money by doing, you know, actual work.

  • by bradley13 ( 1118935 ) on Sunday December 08, 2019 @03:22PM (#59498602) Homepage

    ...since these people produce very little of value. Seriously, what is there about trading that wouldn't be better, if automated? The only trick is auditing the automation to ensure that no one builds in some sort of secret advantage for themselves.

  • By pushing it to its ridiculous logical conclusion.

    Seriously... then concept that you can make others work for you, by pushing a few numbers around and back and forth, that very loosely represent some beliefs of worth, and acting like those numbers could be equated to a certificate of having done actual work that deserves work in exchange, is so insane and wrong, it must be the epitome of all white collar crimes.

  • by TheNarrator ( 200498 ) on Sunday December 08, 2019 @03:47PM (#59498656)

    We have computers now that can decide which companies to invest in and direct the economy. That means we're one step closer to full on communism with an AI god at the helm, right?

  • From Margin Call ...

    Sarah Robertson : What's your background?
    Peter Sullivan : My background?
    Sarah Robertson : Your CV.
    Peter Sullivan : I've been with the firm for two and a half years working with Eric that whole time, but I hold a doctorate in engineering, speciality in propulsion, from MIT, with a Bachelor's from Penn.
    Jared Cohen : What is a 'specialty in propulsion,' exactly?
    Peter Sullivan : My thesis was a study in the ways that friction ratios affect steering outcomes in aeronautical use under reduced

  • The stock market will cease to be a place where profits can be had, since transactions will all be based on logic and fact with no emotion. Profits usually come when the market is doing something dumb based based on limited facts or pure emotion, remove that so the pricing always makes sense and what's the point? You'll get a better rate of return off bonds or even a good savings account.

  • A future with no middle-{men,women,trans,non-binary} involved in the transaction.

    From cashiers, to whole bricks-and-mortor stores, to financial services... It looks like much of the 20th century MBA conventional wisdom is falling by the wayside.

    Perhaps they are just over-qualified for the positions instead of being replaced or made redundant by technology. They could spin this as the feel-good story of the century if they play it right. A country of over-qualified workers (both skilled and unskilled l
  • This was a confusing post because algorithms have been used in the financial sector since at least the 1980s. The article that was quoted seems to say that automation may have a disproportionate effect on the jobs of African Americans in the finance industry. Basically the state of our education system is so bad that minorities may face a difficult time becoming quants.
  • I really would. A huge part of the finance industry is parasitic, and a small but economically important part of it is even destructive to the economic system as a whole. The part that didn't learn after the recent financial meltdown and crisis, not because they can't learn, but because it was more lucrative to get bailed out, keep doing the same things and hope you'll be bailed out the next time, too.

    I'd say good riddance - except that the business methods and the destructive potential of the financial mar

  • Sales of miniature violins are up 23%.
  • Sure, why not! It's not clear that Wall Street analysis are any better than robots at this point, since they tend to be late on trends. I am surprised AI has not already displayed most of these fund managers' jobs.
  • Skynet isn't going to kill us all he's going to enslave us using our own monetary system!

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