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The article examines two digital phenomena linked to money and finance, which are the bitcoin (in particular the blockchain technology it is founded on) and high-frequency trading, through the lens of Vilém Flusser's concept of technical image. Flusser's theory highlights three aspects of technical images: they are engendered by the act of organizing particles, are produced by people who operate devices through keys, and are mediated by code, which is linear and pertains to the era of written text, which Flusser conflates with the notion of history. In this article, the argument focuses on the aspects of high-frequency trading and the blockchain that relate to the idea of images. The sections investigate how money has historically operated in the logic of Flusser's description of symbol manipulation in relation to consciousness and temporality: from the circular time of magical consciousness to the linear time of historical consciousness, and more recently, to the non-dimensional time of post-historical consciousness. The article argues that there are two levels, or layers, in the images involved in cryptocurrencies or algorithmic trading, but only one of them is visible to the human operator or viewer, in the form of a price. The other, which indeed represents the operations in the system, is only accessible to the machines themselves. The questions raised concern the role of these recent digital financial and monetary forms in the development of a reality dominated by apparatuses and technical images., Author(s): Diego Viana [sup.1] Author Affiliations: (Aff1) 0000 0004 1937 0722, grid.11899.38, Universidade de São Paulo Rua Girassol, , 554, apto. 183, São Paulo, SP, Brazil Introduction Money and finance [...]

We propose a partitioning algorithm to solve a class of linear-quadratic Markov decision processes with inequality constraints and nonconvex stagewise cost; within each region of the partitioned state space, the value function and the optimal policy have analytical quadratic and linear forms, respectively. Compared to grid-based numerical schemes, the partitioning algorithm gives the closed-form solution without discretization error, and in many cases does not suffer from the curse of dimensionality. The algorithm is applied to two applications. In the main application, we present a model for limit order books with stochastic market depth to study the optimal order execution problem; stochastic market depth is consistent with empirical studies and necessary to accommodate various order activities. The optimal execution policy obtained by the algorithm significantly outperforms that of a deterministic market depth model in numerical examples. In the second application, we use the algorithm to compute the exact optimal solution to the renewable electricity management problem, for which previously only an approximate solution was known. As a comparison, we show that the approximate solution can be quite inaccurate for some initial states and thus demonstrate an advantage of the exact solution. History: Accepted by Yinyu-Ye, optimization. Funding: The research of S. Kou was supported in part by the Ministry of Education in Singapore [Grant MOE2014-T2-1-006] and by the National Natural Science Foundation of China [Grant R-2015-S-005]. The research of N. Chen was supported in part by the Hong Kong University of Science and Technology [Start-up Fund R9382]. Supplemental Material: The online appendix is available at https://doi.org/10.1287/mnsc.2016.2639. Keywords: Markov chains * large order execution * electricity trading/production * partitioning * quadratic stochastic programming, 1. Introduction Linear-quadratic-Gaussian control is one of the few examples in stochastic dynamic programming that yields a closed-form solution (see, e.g., Bertsekas 1995, Athans 1971). It has quadratic costs and [...]

To minimize risks, we must learn more about how financial markets operate at ever faster rates, urges Mark Buchanan., Author(s): Mark Buchanan [sup.1] Author Affiliations: (1) Mark Buchanan is a science writer based in the United Kingdom. His latest book is Forecast: What Physics, Meteorology and the Natural Sciences [...]