Actually, HFT is socially useful in the same way that Cold War research, even though most of it never went anywhere, is.
It bids up the price of talent, and that's an inherent social good because it means there is a chance for smart people to get into decision-making positions (which, otherwise, go to entitled, and mostly untalented, incumbents and their shitty offspring). Google and Amazon would not be paying $140k per year for mid-career software engineers, were it not for the hedge funds paying $200k.
VC-istan is terrible, with founders lucky to get 10% and earliest employees getting 0.1-1%, but if Wall Street wasn't absorbing most of the top talent (and it is) those numbers would be closer to 1% and 0.001-0.05%. Instead of very few people getting rich in the tech lottery, it'd be almost no one, because the founders and early engineers would have zero leverage.
The HN crowd likes to assume that talented people will, as if it were a law of nature, have options to rise economically and socially. It's not so. If it weren't for socially useless talent vampires like HFT and online ad targeting, talent would have even less leverage against the good-ol'-boy networks and widespread stagnation would ensue.
(High levels of funding, probably originating from governments at first, for basic research would achieve the same effect in a socially useful way, but I wouldn't hold my breath.)
It bids up the price of talent, and that's an inherent social good because it means there is a chance for smart people to get into decision-making positions (which, otherwise, go to entitled, and mostly untalented, incumbents and their shitty offspring). Google and Amazon would not be paying $140k per year for mid-career software engineers, were it not for the hedge funds paying $200k.
VC-istan is terrible, with founders lucky to get 10% and earliest employees getting 0.1-1%, but if Wall Street wasn't absorbing most of the top talent (and it is) those numbers would be closer to 1% and 0.001-0.05%. Instead of very few people getting rich in the tech lottery, it'd be almost no one, because the founders and early engineers would have zero leverage.
The HN crowd likes to assume that talented people will, as if it were a law of nature, have options to rise economically and socially. It's not so. If it weren't for socially useless talent vampires like HFT and online ad targeting, talent would have even less leverage against the good-ol'-boy networks and widespread stagnation would ensue.
(High levels of funding, probably originating from governments at first, for basic research would achieve the same effect in a socially useful way, but I wouldn't hold my breath.)