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Implementing something like Andrew Lo's encryption algorithm to avoid future flash crashes is a great idea https://www.technologyreview.com/s/512291/how-to-avoid-anoth....

It's also interesting the article refers to Sarao as frugal. If he was really frugal it seems like he would have said that X amount of money is enough and stopped risking it all. Scary stuff!




He wasn't being frugal to be frugal, he was being frugal to maximize the amount he could invest TODAY and earn TOMORROW.


In my opinion, this kind of frugality happen when you have a small (or non-existant) social circle. The main reason to spend (clothes, cars, etc..) is to impress the people around you. If they don't exist, you are not that much pressured to spend.


This describes me though I have a reasonable social circle I pretty much don't care about any of the things on your list.

I rent a flat (apartment), I only own jeans, t-shirts and pullovers, don't own a car, own second hand (but good) furniture.

I'm trying to remember the last time I spent over £50 on anything that wasn't a gift for someone else and I really can't, perhaps my weight set about 18mths ago.

I'm just not attracted to stuff or to signalling via it.

Social pressure is often largely self-inflicted.


Implementing a very basic order entry check to verify each client's abuse of an orderbook like this is pretty trivial and done in a lot of places. CME just didn't want to do anything about it.




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