Chapter 14. Financial Singularity
We find ourselves in a thicket of strategic complexity, surrounded by a dense mist of uncertainty.
Nick Bostrom (2014)
“Most trading and investment roles will disappear and over time, probably most roles that require human services will be automated,” says Mr Skinner. “What you will end up with is banks that are run primarily by managers and machines. The managers decide what the machines need to do, and the machines do the job.”
Nick Huber (2020)
Can AI-based competition in the financial industry lead to a financial singularity? This is the main question that this final chapter discusses. It starts with “Notions and Definitions”, which defines expressions such as financial singularity and artificial financial intelligence (AFI). “What Is at Stake?” illustrates what, in terms of potential wealth accumulation, is at stake in the race for an AFI. “Paths to Financial Singularity” considers, against the background of Chapter 2, paths that might lead to an AFI. “Orthogonal Skills and Resources” argues that there are a number of resources that are instrumental and orthogonal to the goal of creating an AFI. Anybody involved in the race for an AFI will compete for these resources. Finally, “Star Trek or Star Wars” considers whether an AFI, as discussed in this chapter, will benefit only a few people or humanity as a whole.
Notions and Definitions
The expression financial singularity dates back at least to the 2015 blog post by Shiller. In this post, ...