“Way up in a New York skyscraper, inside the headquarters of Lehman Brothers Holdings Inc., Michael Kearns is trying to teach a computer to do something other machines can’t: think like a Wall Street trader. In his cubicle overlooking the trading floor, Kearns, 44, consults with Lehman Brothers traders as Ph.D.s tap away at secret software. The programs they’re writing are designed to sift through billions of trades and spot subtle patterns in world markets.
Kearns, a computer scientist who has a doctorate from Harvard University, says the code is part of a dream he’s been chasing for more than two decades: to imbue computers with artificial intelligence, or AI.
His vision of Wall Street conjures up science fiction fantasies of HAL 9000, the sentient computer in “2001: A Space Odyssey.” Instead of mindlessly crunching numbers, AI-powered circuitry one day will mimic our brains and understand our emotions — and outsmart human stock pickers, he says.
“This is going to change the world, and it’s going to change Wall Street,” says Kearns ” - Bloomberg, May2007
This is an extract from an article that appeared in the Bloomberg Markets magazine in the month of May. Its amazing how closely science is now intertwined with business and quant finance more specifically. This article reminded me of Roger Lowenstein remarking in his masterpiece, ”When genius failed” about how the bigwigs of the science world at LTCM would regularly run to physics libraries and journals, hoping to find models and theories to fit their money making schemes.
Next: Arrival at Stanford!
