It's called Singularity by tech geeks. To lay people the easiest way to describe it is as the moment at which machines take control of human-kind, effectively ending man's run as apex predator on the food chain. Elon Musk and Stephan Hawking are just two of the super-geeks who've picked up the banner on warning society against this threat but the idea isn't new. It was popularized more than 20 years ago when a sci-fi writer described Singularity as "the moment at which our old models must be discarded and a new reality rules."
I got news for you. This has already happened for stocks. In fact the last year has been a singular nightmare for individuals but the machines are, at least according to the Wall Street Journal, having their best year since 2008. You might remember 2008. That was the year stocks moved 5% a day and the world nearly ended. Since then we've had an HFT Flash Crash and a wildly popular book called Flash Boys, but nothing has changed. The machines are cleaning up at individuals expense.
Look at the week in crude, up 11% the hard way after ramping Tuesday, crashing Wednesday and rallying almost 10% yesterday. This is crude oil, not bitcoin. It's not "supposed" to trade that way -- and for the sake of clarity I'm slapping huge air quotes on that "supposed."
If crude is too esoteric consider stocks. 24 hours ago I noted that the European Central Bank had effectively wiped out an entire Greek economy worth of gains in 10 minutes on Wednesday. Never mind. We took it all back and then some yesterday. In fact stocks are higher for the year and at the tippy top of that channel we've been discussing endlessly.
In fact, this has been the best week for stocks since October so very few people are likely to complain about the volatility seeming more than a little "unnatural."
Businesses, that is to say the actual fundamentals, are still being run by people. You can see that in the slow-motion wreck that isRadioShack, finally bankrupt after all these years, finished off by debt holders. In its heyday RadioShack popularized the personal computer, in effect contributing the technology that will end us all even as it failed due to old-fashioned dumbness.
What can you do? Nothing. Literally. You can't outtrade machines. The algos are set up to create then capitalize on momentum of human traders. Don't play into it. Buy, hold, study. Sound your yawp against the machines by not handing them your bankroll. In the long run that's your only defense.
