Approaching Singularity?

In Will Technology Outsmart Us I have used a title that also could have been Approaching Singularity using the word popularized by the futurist Ray Kurzweil predicting that if the technology becomes more intelligent it will become self-driven by positive feed back loops.

In his Blog post Approaching the Singularity - in Global Finance  Mark Buchanan discusses: that in a smaller scope we may getting close. High frequency trading, where markets are already showing signs of having already made a transition into a machine-dominated phase, where humans have little control.

His post is about the complexity of agents being involved and time available to run certain trading strategies and controls, and the transition from a mixed phase of human-machine interaction to an ultrafast all-machine phase. In short, below, say, a second humans are out.

And what conclusions this has for possible regulations, ...

A great post.

The Smart Revolution.

After I have posted Will Technology Outsmart Us, I searched a little and found in The NY Times, Not Quite Smart Enough. Smart appliances are part of a larger trend toward smart electronics, it says.
So, if I have a freshly caught trout and beetroot in my refrigerator it will tell me recipes ...
One by Heston Blumenthal or Alain Ducasse, one on dietary needs?

Will I have a cybernetic "aura" telling smart devices what I am interested in, what my preferences are? Will those smart devices react on those. Will the washer or dryer in my smart-grid remind me that there is an interesting talk on inverse problems at the university, when I forgot asking my iPad?

In my futuristic home, will I never be lonely if living alone  - always getting recommendations of devices?

I rather hope that homes will self-organize and optimize energy consumption, interacting with local weather forecasting, on the coarse grain and by device integration on the fine grain level.
I want to have "walls" for digital arts, entertainment and edutainment .... but to be inspired to make better decisions for traveling, getting out in real nature, interacting with people, go to theaters, learn with others, ...

Systems that remove barriers to strive for innovations not making me a lazy follower-of-fashion.

Will Technology Outsmart Us?

Does Complexity Economics need complex simulation systems to gain insight and even beyond, complex control systems to being "managed"? A global controller is in contradiction to complexity.
I see a system as complex, if it contained subsystems of co-evolution.

Traditional economic models see an interplay between countless market participants who acting more or less rational bringing the markets towards a balance and external impacts mostly based on events as well as rules and technology developments.
In short, financial instruments taking their realistic values would "freeze" - the market would settle down - without external "shocks".
Do they? Complex, constructive learning plays an important role in such complex systems leading to an internal dynamics even with the absence of external shocks.

M Buchanan went into details in his post Minority Games. Really exciting.

But let me step back a little. Will there be a co-evolution of human and artificial intelligence or will technology just take over? In other words, will we, will we need to stay competitive?

I have a background in factory automation and in this field feed back loops are still used to control machine tools, robots, transportation and storage systems. There will be a better way of interaction based on simple local intelligence.

What about an economic agent system?

Let me escape from the feasibility question.
Can competition in principle mean "fewer" losses?
Humans build networks to enhance knowledge, interact across cultures, ask great questions, engage opposite views, .... they co-operate.

Therefore I do not see the future spectacled, say, in the Matrix films.
What interacting with technology teaches us will be important and consequently, we need to design systems strictly bottom up.

Open For Open Innovation?

In a first view Open Innovation sounds like a generalization of the Open Source idea. Free intellectual property rights?
The term was promoted by Chesbrough, H. (2003), Open Innovation: the New Imperative for Creating and Profiting from Technology. Harvard Business School Press.

To my opinion ist is gaining and sharing knowledge, involving other parties when developing new products and technologies  and combining internal and external ideas in the flow from research to packaging.

As a spin-off of distinguished mathematical research institutions the UnRisk Consortium  lives the open innovation principles from the beginning.

Having decided to unleashing the programming power behind UnRisk we stretch this principle to customers and partners, who want to work with us on the basis of know-how packages.

This is already part of our business model since we have released  UnRisk-Q. With the All-New UnRisk realization it will be further perfected.

UnRisk-Q enables quant developers to increase the effectiveness and efficiency of their innovations. They  concentrate on the creation of their innovations relying on white-box tools from UnRisk - the same that are integrated in widely used UnRisk solutions at banks, capital management firms, insurances, ..

In short, we, at UnRisk, are here for innovation - we partner on innovative organizational and licensing arrangements for better technical and economic feasibility of our partners projects - transferring better tools for advanced valuation and risk management processes.

The Internet Of Things

The internet of things (first mentioned 1999) refers to the representation of uniquely identifiable objects in the internet. Autonomous and intelligent entities shall interoperate online. Alliances are built to promote this idea.

In June, 2009 I was asking myself in The Internet Of whether domain specific The Internet Of ... instantiations would emerge ... like the Internet Of Finance?

In The Internet Gets Physical, The NY Times, Steve Lohr summarizes that low-cost sensors, clever software and more powerful computers are are opening the door to new uses in energy conservation, transportation health care and food distribution.
This might include "soft sensors" for all kind of intelligent analysis including sentiment analysis.

In finance we have massive market data, computational knowledge, we could introduce more intelligent data analysis, we have enormous computing muscles and we have the internet.

But I still do not see an initiative for The Internet Of Finance. For the management of systemic risk, identifying anomalies and unexpected market shifts, the transitions from swarm into avalanche behavior ...

UnRisk FACTORY 3.1 Is Released

UnRisk took UnRisk FACTORY 3.1 to financial institutions.

It completes the UnRisk VaR Universe with Montecarlo VaR for all instrument types. The VaR Universe is integral part of the UnRisk FACTORY Capital Manager  used for both advanced investment functions and risk management processes.

In May-08 UnRisk has releases UnRisk FACTORY.  Now, UnRisk FACTORY 3.1 is the 8th release.
Customers enjoy faster time-to-insight, integrated and automated valuation and data management.

Driving the latest and generic technology enables us to support HPC on minimalist infrastructure  and offer UnRisk for unprecedented low cost of ownership.

Optimal Risk

Between Xmas and New Year, I took a few days off for cross country skiing in the heart of the Bohemian Forest.
It seems that I took the optimal risk.

I am over 65 and taking this in account, I selected the right skating trails, lengths and duration. Challenging steepness, skating long and swiftly enough to have a lot of fun and add to fitness incrementally, but avoiding hazardous, exhausting actions - so I never fell down, nor suffered I from a total fatigue of joints, ...
I run as often as possible in winter time, for 40 years now, so I have some experience in cross-country skiing risk management.
Maybe the same time as the very first quants have with quantitative financial risk management, wondering how many would care about optimal risk? ;)