Did software cause the credit crunch‾

The Guardian reports that one group is yet to face criticism for its part in the global financial meltdown - the analysts who created the software that drove the derivatives market.

The articles says, "Since the Big Bang of the 1980s, large amounts of stocks and shares - and derivatives of them - have been traded automatically by computers rather than by humans. These so-called "˜algotrades' accounted for as much as 40% of all trades on the London Stock Exchange in 2006; on some American equity markets the figure can be as high as 80%."

It continues, "The people who write the algorithms that drive the software are called quantities analysts, often referred to simply as "˜quants'. They are generally physics and mathematics graduates working in risk management - calculating whether a given deal is a good idea - and derivatives pricing, which entails putting a figure on trades that in effect bet on other trades. It's enormously complex, which is why only the quants could understand it - if, that is, they did. History now suggests they didn't."

See here for the full story.

Suggested Articles

Wireless operators can provide 5G services with spectrum bands both above and below 6 GHz—but that doesn't mean that all countries will let them.

Here are the stories we’re tracking today.

The 5G Mobile Network Architecture research project will implement two 5G use cases in real-world test beds.