Advantages and Disadvantages – Fast and Slow

I mentioned previously a thought about how advantages change over times.

I’ll point out a real-life example in the stock market. Once upon a time, it was important to get the information faster. The earnings reports, who is joining the company, etc. Having that info before the competition meant you could figure out the new price adjustment and but or sell accordingly.

The internet made the ascertainment of this info possible in milliseconds. Programs and algorithms can be written to check for company updates, tweets, online advertisements, google trends and more and adjust accordingly. People who understood this first when the internet came along received a major advantage and made piles of money.

Now, something new is happening. As the finance world is figuring this out, we are being bombarded with every which narrative possible. If an article is posted that a new CEO is coming on board, another one will be made that says that’s not the case. There is a need to throw the competition’s “faster than human” algorithms off track in order to beat them.

With that in mind, fake narratives that a computer can’t decide between and responding too quick may become a disadvantage. What if a computer makes a disastrous decision for you at lightning speed on intentionally incorrect data?

Advantages and disadvantages change over time. Recognize it. Check in with what you think you know. A mathematical function that changes slowly over long periods of time may seem like a constant, but that isn’t necessarily the true reality. Same is true with your assumptions about the world.