Friday, April 27, 2018

Quantum Computing and Quants and the Turing Institute's mission

so people are afraid of quantum computing.
people should be far more afraid of today's algorithmic trading systems.
the world is run by a bunch of computer programs which have never been scrutinized - they might just each be nonsense, but in combination, even if they are all very correct, they certainly create nonsense. The fiction that the world is running on some financial fantasy academic structure known as a market is a wonder to behold - essentially, the sustained collective delusion in the face of obvious massive fractural objections (american exceptionalism:  why is the dollar worth what it is, aside from military might? protected markets inside China; split level economies like Brazil and so on) - all this is like the medieval world where the SMith would charge one price to shoe the farmer's horse, and another (massively higher) price to shoe the Lord of the Manor's horse - why? and why didn't anyone run arbitrage on this? because society and people don't mix with the idea of money really at all well.

So a lot of work in machine learning and AI and finance purports to address problems like money laundering and fraud and so forth. And yet we live in a world where the whole operation of existing algorithms is based on a false belief, that they operate in a market. Many of them operate in the casino that is the stock market, which is even more divorced from reality than the rest of the economy. Here algorithms are in an arms race, and yet it is an odd arms race, as unlike warfare i nconventional battlefields where we can pick apart the guns and planes of the other side from time to time and take their ideas, or at least reverse engineer them, the algorithmic race in the stock market is too complex and too fast to allow this - code just interacts via the symptomatic (observed) behaviour of the system, and rarely if ever directly interacts with other code. Most weird.

SO the real first duty of ML&AI in the world of finance should be to expose and fix these structural problems - first, to model the worlds economy properly (e.g at least as well as people like Piketty, but more so, dynamically), and to build a sound system for running investments without casinos like the stock market, but also without fantasies like Adam Smith's invisible hand.

So what has this to do with Quantum Computers[1]?

Well, QC promises to run some new algorithms in a new way - there aren't any signs of a full working QC piece of hardware yet, and there are precious few actual algorithms[2] so far, but one in particular has grabbed a lot of attention, which is the possibility to factorize numbers super fast compared with good old fashioned von-Neumann computers (faster even parallel and distributed vN machines) - this is due to the qualitatively different way that QC hardware works (highly parallel exploration of state spaces, scaling exponentially with the number of Qbits).

So what does this threaten?

Well, it threatens to break cryptograpy, which means our privacy technologies for storing and transmitting (and possibly even securely processing[3]) data are at risk. Bad guys (or just curious people) will be able to see our secrets.

So two thoughts
A) why can't we just devise new QC encryption algorithms, which just moves the arms race along in the usual way (a million bit keys for example, or something really new we havnt thought of yet)? Then we are back to the same old normal world where most data breaches will be because of social engineering or stupidity and self inflicted (minister leaves unencrypted USB stick on the bus) wounds.
B) Maybe we get more cautious as a whole and just don't send stuff around so glibly or provide remote access to our computers so readily. Maybe access control and authentication and just implementing least privlege properly could work most of the time, and the whole idea of crypto saving us was a chimera and a delusion, just like the whole idea of the market was a snare and a delusion?

my 2 q-cents.

1. not to be confused with quantum communication where we use entanglement just to detect eavesdroppers - a perfectly sound, existing tech with a very narrow (point to point, not end-to-end) domain of usefulness.
2. shor's algo for example. one puzzling thing is that we had hundreds of algorithms for von-neumann style computers before we had any working hardware. why is it so hard to conceive of algorithms for QC? seems like it is a poor match for how humans are able to express methods for solving problems (which are many, and varied, but don't seem to fit ensemble/state space exploration, except perhaps in MCMC:-)
3. eg.. homomorphic crypto - possibly also at risk from QC, although re-applying ideas like garbled circuits to a QC machine shouldn't be too hard:-)

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misery me, there is a floccipaucinihilipilification (*) of chronsynclastic infundibuli in these parts and I must therefore refer you to frank zappa instead, and go home