Bugs,predations or manipulations? Incompatible epistemic regimes of high-frequency trading

Abstract

Calls for greater transparency as well as corporate and individual accountability have emerged in response to the recent turbulence in financial markets. In the field of high-frequency trading (HFT), suggested solutions have involved a call for increased market information, for example, or better access to the inner workings of algorithmic trading systems. Through a combination of fieldwork conducted in HFT firms and discourse analysis, I show that the problem may not always stem from a lack of information. Instead, my comparative analysis of different market actors (regulators, market analysts and traders) shows that the diverse and complex ways in which they access and construct knowledge out of information in fact lead to what I call different epistemic regimes. An understanding of how epistemic regimes work will enable us to explain not only why the same market event can be viewed as very different things – as market manipulation, predation or error – but also why it is so difficult to arrive at a unified theory or view of HFT. The comparative perspective introduced by the idea of epistemic regimes might also serve as a starting point for the development of a cultural approach to the study of financial markets.     

High-frequency trading: networks of wealth and the concentration of power

The development of high-frequency trading (HFT) – automated trading of stocks, as well as bonds, options, and other investment instruments – provides a signal example of the political effects of computerization on a discrete social sphere. Despite the widespread rhetoric that computerization inherently democratizes, the consequences of the introduction of HFT are widely acknowledged to be new concentrations of wealth and power, opacity rather than transparency of information flows, and structural resistance to democratic oversight and control. Even as computerized tools undoubtedly provide individual investors with more power relative to what they had before, they also provide powerful actors with relatively more power as well, in some cases effectively excluding the majority of individuals from insight or meaningful participation whatsoever, especially with regard to the political impacts of market activities. Reports on recent financial crises, and the 2011 film Margin Call provide narrow windows into the operations of HFT and the challenges it poses to democracy; these in turn raise significant problems for the view that computerization inherently democratizes.     

Keeping warm cookies: Cultural discourses of fun talk in public participation

ABSTRACT

Declining rates of public participation in the United States of America have raised questions about the sustainability and effectiveness of U.S. democracy. Some scholars have called for making democracy fun through the use of game design to make public participation more accessible. Using cultural discourse analysis, this study explores the locally situated communication practices of a civil society organization called Warm Cookies of the Revolution that seeks to (re)imagine U.S. democracy by making public participation fun. The research employs ‘fun talk’ – a specific communication practice within public participation – as an analytical unit and finds that fun talk served as a discursive hub of emotion with radiants of meaning connected to being, acting, and relating. In contrast to those who have argued fun democratic practices should employ game design to improve public administration, participants understood fun talk as a way to introduce them to civic affairs, form relationships with neighbours, and take action to improve their communities. The article discusses implications for theories of emotion and affect in civil society scholarship.     

What is an algorithm? Financial regulation in the era of high-frequency trading

Abstract

In response to the flash crashes and market manipulations blamed on high-frequency trading (HFT), algorithms have been brought inside the regulatory perimeter. This paper focuses on the most ambitious regulation directed at the practice: the algorithm-tagging rule in the German High-Frequency Trading Act. Fifteen interviews with stakeholders in the Act’s implementation serve to reconstruct how regulators defined an algorithm and help pose the question of to what extent regulatory definitions and data need accurately to represent financial practices to be useful. Although tentative in its findings, the research suggests that the algorithm-tagging rule may be providing valuable signals in the noise to trade surveillance officers and having virtuous effects on the cultures of trading firms. The conclusion argues that sociologists of finance should adopt a more balanced approach when evaluating regulatory technologies and heed MacKenzie’s 2005 call to open up their black boxes.     

Organizational ignorance: an ethnographic study of high-frequency trading

Abstract

This paper provides an analysis of strategic uses of ignorance or not-knowing in one of the most secretive industries within the financial sector. The focus of the paper is on the relation between imitation and ignorance within the organizational structure of high-frequency trading (HFT) firms. In social studies of finance (SSF) literature imitation is considered a strategic act, i.e. imitation is a term applied when traders copy the strategies of other traders. I wish to turn this relation between ignorance and imitation on its head and consider ignorance itself as a strategic unknown and investigate the kinds of imitations that might be produced from structures of not-knowing (i.e. structures intended to divide, obscure and protect knowledge). This point is illustrated through ethnographic studies and interviews within five HFT firms. The data show how a black-box structure of ignorance is replicated within the organizational setting of these firms and re-enacted by the traders. Towards the end of the paper the politics of the relationship between imitation and ignorance is discussed.     

Social media as semiotic technology and social practice: the case of ResearchGate’s design and its potential to transform social practice

ABSTRACT

This article addresses the need for critical approaches to social media by bridging the focus on language and other semiotic resources that characterises discourse studies with the broader perspective on social media as social, cultural, economic and technological constructs that dominates media and cultural studies. Specifically, we propose a model for analysing how social media as semiotic technologies, that is, technologies designed to enable and constrain meaning-making, may transform social practices. By incorporating Van Leeuwen’s [2008. Discourse and Practice: New Tools for Critical Analysis. London: Oxford University Press] framework for the critical analysis of discourse and social practice, the model extends the social semiotic approach developed in recent critical multimodal studies of software such as PowerPoint to social media, which function primarily to provide platforms for and commodify social practices, rather than to offer rich arrays of semiotic resources for creating multimodal texts and artefacts. Using the academic social network site ResearchGate and the practice of research peer review, we illustrate the model’s capacity to account for the ways the design of social media platforms – through the semiotic resources they make available and the ways these are presented – enables and constrains their users’ ability to perform key social practices and has the potential to transform these practices.     

The Structure of Political Competition: Dimensions of Candidate and Group Evaluation Revisited

In this paper, we take a fresh look at the structure of sociopolitical conflict through confirmatory factor analyses of survey data gathered in Florida during the presidential campaign of 1996. Our analysis shows both stability and change in the electorate. In line with prior research, a single bipolar partisan dimension underlies the mass public's evaluations of political leaders, though national figures fit more comfortably on this continuum than do those at the state level. Citizens' evaluations of key sociopolitical groups reflect orthogonal cultural disputes, class divisions, and conflicts relating to issues of social control. While all three of these dimensions impinge to some degree on voters' conceptions of party and ideology, our findings point to the leading role that cultural issues now play in shaping ideological images and identities.     

Court pedagogies and the construction of passive ordinary citizens in the French banlieue

ABSTRACT

This article contributes to conceptualizations of the pedagogical state by analyzing judicial spaces, beyond the courtroom, as key sites of citizenship formation. I explore pedagogical sessions organized by a judicial structure in France, whose geographical proximity to seemingly non-integrated populations in the banlieue allows it to teach them the laws, rules, and institutions that support citizenship. I argue that the pedagogical court seeks to construct governable ‘passive ordinary citizens’ whose main duty is to embody and practice the basic rules of socialization – respect for others and the rule of law – in their ordinary lives as a strategy of crime prevention. In that sense, courts are able to redefine not only the procedural but the substantive elements of citizenship as well.     

Antipodean Enlightenment

Abstract

In his monumental collection Culture, Science, Society: The Constitution of Cultural Modernity, György Markus lays down the conceptual framework for the theorisation of modern high culture across the cultural spheres and articulates an account of cultural pragmatics or cultural relations – author, text and public – in the domains of science, arts and the humanities. He explores in great detail the conceptual keystones in the evolution of the cultural self-understanding of modernity from the enlightenment until today. Markus’s work resonates with a deep understanding of the historico-cultural terrain being covered and the conceptual issues at play.     

Learning about Learning: Discovering the Work of Policy

The development of policy rests on skilled practice by knowledgeable practitioners – ‘policy work’ – and it is important to know what skills and knowledge this work calls upon, and where these are learned. Although there is substantial academic knowledge and courses in this field, many practitioners will argue that policy work is ‘as much an art as a science’ and is something that ‘you learn as you go’. This article reports on an exploratory study of policy practitioners’ accounts of their practice, what counts as knowledge, and in what contexts it is ‘useful’. We examine the discourses through which policy work is accomplished, the way in which people learn to do it, and the place of academic work in the constitution of these discourses. Drawing on our respondents understanding of policy practice, we discuss what more might be done to facilitate learning about the work of policy.     

Understanding varieties of populism in times of crises

Abstract

This introduction presents the conceptual and analytical framework which constitutes the background for the special issue entitled ‘Varieties of Populism in Europe in Times of Crises’. More specifically, this contribution investigates how different populist parties in the European Union have been affected by the recent economic crisis and the more long-lasting political and cultural crises. Analytically, the article disentangles the role of the Great Recession vis-à-vis other factors (such as political and party system factors, but also structural social changes or cultural opportunities) in the growing strength of populist parties in various European countries. It argues that although the economic crisis has without any doubt provided a specific ‘window of opportunity’ for the emergence of new political actors, which have capitalised on citizens’ discontent, long-lasting political factors – such as the increasing distrust toward political institutions and parties – and the more recent cultural crisis connected with migration issues have offered further fertile ground for the consolidation of populist parties in several European countries. Furthermore, as confirmed by the articles presented in the special issue, the various crises have offered differential opportunities for different types of populism – both inclusionary and exclusionary.     

The rise of the randomistas: on the experimental turn in international aid

Abstract

In recent years, the use of experimental methodologies has emerged as a central means of evaluating international aid interventions. Today, proponents of randomized control trials (so-called randomistas) are among the most influential of development experts. This paper examines the growth of this thought collective, analysing how uncertainty has become a central concern of development institutions. It demonstrates that transformations within the aid industry – including the influence of evidence-based policy, the economization of development and the retreat from macro-planning – created the conditions of possibility for experimentation. Within this field, the randomistas adeptly pursued a variety of rhetorical, affective, methodological and organizational strategies that emphasized the lack of credible knowledge within aid and the ability of experiments to rectify the situation. Importantly, they have insisted on the moral worth of experimentation; indeed, the experimental ethic has been proposed as the way to change the spirit of development. Through causal certitude, they propose to reduce human suffering. The rise of experimentation has not, however, eliminated accusations of uncertainty; rather, it has redistributed the means through which knowledge about development is considered credible.     

Market coordination and the making of conventions: qualities,consumption and sustainability in the agro-food industry

Abstract

The coordination of activity across sites and spaces of production and consumption is a key concern for economic analysis. Joining a revival in the application of convention theory to agro-food scholarship, this paper considers complementary insights – related principally to ‘the economy of qualities’ – that animate different aspects of e/valuation, competition and alignment. These understandings are extended by more thoroughly acknowledging contemporary developments in consumption scholarship. The arguments are advanced through a case study of the orange juice market, linking its current high-carbon trajectory to the commercial and cultural significance of freshness. The analysis offers new insights into distributed processes of qualification as well as the mechanisms through which conventions are assembled and sustained. Finally, a more integrated approach to food production and consumption is outlined.     

The critical problem of cynical irony meaning what you say and ideologies of class and gender

ABSTRACT

Critical theorists such as Slavoj ?i?ek have for some years discussed the ideological significance of cynical or “blank” irony in fairly general terms. Less attention has been paid to the practical implications of such irony for critical semiotic analysis. With this in mind, this paper discusses the problems that sexist and “classist” jokes – specifically jokes about “chavs” – pose for the critical analyst. On the one hand, they seem to be saying deeply ideological things. On the other, their ironic nature means that they evade the claim that they are really saying, asserting, meaning anything. Theirs is a kind of blank irony which can be identified in all kinds of contemporary semiotic practice and is therefore an important phenomenon for critical analysts to get to grips with. The paper attempts to get to grips with it by outlining some semiotic clues to blank irony, and, more importantly, by suggesting some ways in which we might try to bring a critical perspective to bear in cases of cynical irony.     

Introduction: The dynamics of ideas

Abstract

Participants in today's financial markets confront a sea of data. While the availability of market data has benefits it also creates problems, notably those relating to questions of meaning, judgement and intervention: how to make sense of these flows – how to see the ‘market’, its futures, and thus act pre-emptively. Over more recent years financial organizations have been turning to new technologies of representation, in particular the design and application of visualization software in an effort to enable better visual imagination of and interaction with markets as they unfold in real time. ‘What you see is what you risk’ in many respects captures the thinking or at least the desire underlying the employment of the latest visualization software. The more powerful one's vision the better able one is to participate in increasingly complex financial markets, at least in theory.

Based on recent interviews with those involved in developing and using the latest visualization software within some of the key markets of global finance, and developing the influential work of Daniel Beunza and David Stark, and Karin Knorr Cetina, in particular, this paper adopts a cultural-economy-of-finance perspective to examine the implications of these new techniques of representation. The paper argues that the latest visual turn within finance should be afforded a more central position in the study of contemporary financial market practices.     

Advertising and the conquest of culture

Thomas Frank's important The conquest of cool: Business culture, counterculture, and the rise of hip consumerism usefully described the advertising industry's “conquest of cool” in the 1960s and beyond, the co-optation of the hip and the cool for the purposes of advertising marketing. This article argues that, since Frank's book appeared, the “convergence of commerce and content” – as the advertising industry calls it – has meant that the production of content is even more entwined with advertising than ever before. The first part of this article describes this shift with particular attention paid to the production of advertising music, which increasingly employs well-known rock, hip-hop, and other popular musicians. The analytical portion of this article draws on the studies of Richard A. Peterson and others on the rise of the socially elite “omnivore” consumer of cultural products to argue that advertising has played a crucial role in this shift, emphasizing the cool and the trendy. Last, the article updates Pierre Bourdieu's influential notion of cultural capital, for, if social elites are more omnivorous in their tastes, then cultural capital today must increasingly be associated with knowledge of the trendy, not only the fine arts.     

Paradoxical individualization: ideological polarization in the U.S. in historical-comparative and theoretical perspective

ABSTRACT

Beginning with Karl Marx, theorists have seen individual autonomy and ideology as opposing elements. Ideology was considered the product of mental, cultural or social constraints. People did not choose their world view – they fell victim to it. With the increase of individual autonomy, however, ideology would wither away. In the late 20th century, the advocates of individualization theory have similarly predicted the vanishing of clear-cut ideological divisions in a world in which any form of collective identity was difficult to sustain. Political eclecticism and the mixing of different political world views would become the new norm. Politics was now ‘beyond left and right’, as Anthony Giddens once famously argued. In my article, I show that this understanding of the relationship between individualization and ideological polarization is flawed. By discussing the extreme ideological polarization in the U.S., I disprove the notion that our need for ideology vanishes the more our freedoms expand. On the contrary, precisely the increase in individual autonomy – in terms of mobility patterns, media use and lifestyle differentiation – has helped to turn the country into a series of closed echo chambers and to deepen the ideological fault lines of American society.     

Umbilical cord blood banking and its interruptions: notes from Chennai,India

Abstract

What is the relationship between globalization and the body? In both scholarly discourse and everyday practice, the relationship between globalization and the body has been understood through the idea of accumulation – the intensified and interlinked pursuit of health and wealth. Through an examination of private umbilical cord blood banking in south India, this paper investigates the interplay of accumulation and its interruption in Indians' uptake of this practice. Although Chennai-based bankers, doctors and parents explain the recent surge in popularity for cord blood banking in the city in terms of interlinked financial and familial accumulation, investment and security, Indians' cultural and religious conceptions of the latent power of the placenta and cord often work against cord blood banking marketers' neat account of twinned economic and familial accumulation. Analytic attention to interruption highlights the tensions within and precariousness of the accumulation at the heart of the relationship between globalization and the body.     

Global democracy and feasibility

ABSTRACT

While methodological and metatheoretical questions pertaining to feasibility have been intensively discussed in the philosophical literature on justice in recent years, these discussions have not permeated the debate on global democracy. The overall aim of this article is to demonstrate the fruitfulness of importing some of the advancements made in this literature into the debate on global democracy, as well as to develop aspects that are relevant for explaining the role of feasibility in normative political theory. This is done by pursuing two arguments. First, to advance the work on the role of feasibility, we suggest as intuitively plausible two metatheoretical constraints on normative political theorizing – the ‘fitness constraint’ and the ‘functional constraint’ – which elucidate a number of aspects relevant in determining proper feasibility constraints for an account in political theory. Secondly, to illustrate the usefulness of this feasibility framework, we sketch an account of global democracy consisting of normative principles which respond differently to these aspects and thus are tied to different feasibility constraints as well as exemplify how it may be applied in practice.     

It is not just who you know: Dominant knowledge and civic participation

Abstract

Civic participation and its role in increasing social capital is touted as a key element in the regeneration of urban communities. This approaches assumes that urban communities are homogenized collective interests and misses the diversity of interests that capitalize on the growth of institutionally supplied social capital brought about through redevelopment projects. This article examines the participatory processes in a Southern California urban community using social and cultural capital frameworks to show that resident participation is a classed and racialized project that privileges those with dominant knowledge, cultural awareness and language skills. The field of contestation, or the political space developed by institutional players for urban regeneration also plays a key role in determining who participates and how decisions are made. While civic participation is presented as a process that is democratic and open to all, this article argues that participation exists within a cultural context that much like the ‘hidden curriculum’ in education, privileges the knowledge of dominant groups.