Open Thread January 2019

So your decision doesn't just determine the future; it also determines (with high probability) which you "you" are.

Worse. It doesn't change who you are, you are the person being blackmailed. This you know. What you don't know is whether you exist (or ever existed). Whether you ever existed is determined by your decision.

(The distinction from the quoted sentence may matter if you put less value on the worlds of people slightly different from yourself, so you may prefer to ensure your own existence, even in a blackmailed situation, over the existence of the alternative you who is not blackmailed but who is different and so less valuable. This of course involves unstable values, but motivates degree of existence phrasing of the effect of decisions, over the change in the content of the world phrasing, since the latter doesn't let us weigh whole alternative worlds differently.)

"FDT means choosing a decision algorithm so that, if a blackmailer inspects your decision algorithm, they will know you can't be blackmailed. If you've chosen such a decision algorithm, a blackmailer won't blackmail you."

Is this an accurate summary?

I only just saw this comment. I think that there's a lot of value in imagining the possibility of both a real you and a hypothetical you, but I expect Schwarz would object to this as the problem statement says, "you". By default, this is assumed to refer to a version of you that is real within the scope of the problem, not a version that is hypothetical within this scope. Indeed, you seem to recognise that your reasoning isn't completely solid when you ask what these hypothetical selves even mean.

Fortunately, this is where some of my arguments from Deconfusing Logical Counterfactuals [LW · GW] can come in. If we are being blackmailed and we are only blackmailed if we pay out, then it is logically impossible for us to not pay out, so we don't have a decision theory problem. Such a problem requires multiple possible actions and the only way to obtain this is by erasing some of the information. So if we erase the information about whether or not you are being blackmailed, we end up with two possibilities: a) you paying the the situation and getting blackmailed or b) you not being the kind of person who would pay and you not getting blackmailed. And in that case we'd pick option a).

We can then answer your the question about how your decision affects the past - it doesn't. The past is fixed and cannot be changed. So why does it look like your decision changes the past? Actually, your decision is fixed as well. You can't actually change what it will be. However, both you decision and the past may be different in counterfactuals, after all, they aren't factual. If we have a perfect predictor and we posit a different decision, then we must necessarily posit a different prediction in the past to maintain consistency. Even though we might talking colloquially about changing a decision, what's actually happening is that we are positing a different counterfactual.

Belatedly, is this a fair summary of your critique?

When someone thinks about another person (e.g. to predict whether they'll submit to blackmail), the act of thinking about the other person creates a sort of 'mental simulation' that has detailed concious experiences in its own right. So you never really know whether you're a flesh-and-blood person or a 'mental simulation' based on a flesh-and-blood person.

Now, suppose you seem to find yourself in a situation where you've been blackmailed. In this context, it's reasonable to wonder whether you're actually a flesh-and-blood person who's been blackmailed -- or merely a 'mental simulation' that exists in the mind of a potential blackmailer. If you're a mental simulation, and you care about the flesh-and-blood person you're based on, then you have reason to resist blackmail. The reason is that the decision you take as a simulation will determine the blackmailer's prediction about how the flesh-and-blood person will behave. If you resist blackmail, then the blackmailer will predict the flesh-and-blood person will refuse blackmail and therefore decide not to blackmail them.

If this is roughly in the right ballpark, then I would have a couple responses:

1. I disagree that the act of thinking about a person will tend to create a mental simulation that has detailed concious experiences in its own right. This seems like a surprising position that goes against the grain of conventional neuroscience and views on the philosophy of conciousness. As a simple illustrative case, suppose that Omega makes a prediction about Person A purely on the basis of their body language. Surely thinking "This guys looks really nervous, he's probably worried he'll be seen as the sort of guy who'll submit to blackmail -- because he is" doesn't require bringing a whole new conciousness into existance.

2. Suppose that when a blackmailer predicts someone's behavior, they do actually create a concious mental simulation. Suppose you don't know whether you're this kind of simulation or the associated flesh-and-blood person, but you care about what happens to the flesh-and-blood person in either case. Then, depending on certain parameter values, CDT does actually say you should resist blackmail. This is because there is some chance that you will cause the flesh-and-blood person to avoid being blackmailed. So CDT gives the response you want in this case.

Overall, I don't think this line of argument really damages CDT. It seems to be based on a claim about conciousness that I think probably wrong. But even if the claim is right, all this implies is that CDT recommends a different action than one would otherwise have thought.

(If my summary is roughly in the right ballpark, then I also think it's totally reasonable for academic decision theorists to read the FDT paper to fail to know that a non-mainstream neuroscience/philosophy-of-conciousness view is being assumed and provides the main justification for FDT. The paper really doesn't directly say anything about this. It seems wrong, then, to me to suggest that Schwarz only disagrees because he lacks the ability to see his own assumptions.)

[[EDIT: Oops, rereading your comment, seems like the summary is probably not fair. I didn't process this bit:

Yes, yes, if Omega used some method other than a simulation to make his prediction, the hypothetical you wouldn't have existed and wouldn't have had a perspective--but hey, that doesn't stop me from writing from their perspective, right? After all, real people write from the perspectives of unreal people all the time; that's just called writing fiction.

But now, reading the rest of the comment in light of this point, I don't think this reduces my qualms. The suggestion seems to be that, when seem to find yourself in the box room, you should in some cases be uncertain about whether or not you exist at all. And in these cases you should one box, because, if it turns out that you don't exist, then your decision to one box will (in some sense) cause a corresponding person who does exist to get more money. You also don't personally get less money by one boxing, because you don't get any money either way, because you don't exist.

Naively, this line of thought seems sketchy. You can have uncertainty about the substrate your mind is being run on or about the features of the external world -- e.g. you can be unsure whether or not you're a simulation -- but there doesn't seem to be room for uncertainty about whether or not you exist. "Cogito, ergo sum" and all that.

There is presumably some set of metaphysical/epistemological positions under which this line of reasoning makes sense, but, again, the paper really doesn't make any of these positions explicit or argue for them directly. I mainly think it's premature to explain the paper's faillure to persuade philosophers in terms of their rigidity or inability to question assumptions.]]

No, this is wrong.

What prevents the FDT agent from getting blackmailed is not that he is known to be an FDT agent. Rather, it’s simply that he’s known to be the sort of person who will blow the whistle on blackmailers. Potential blackmailers need not know or care why the FDT agent behaves like this (indeed, it does not matter at all, for the purpose of each individual case, why the agent behaves like this—whether it’s because the dictates of FDT so direct him, or because he’s naturally stubborn, or whatever; it suffices that blackmailers expect the agent to blow the whistle).

So if we stipulate an FDT agent, we also, thereby, stipulate that he is known to be a whistle-blower. (We’re assuming, in every version of this scenario, that, regardless of the agent’s motivations, his propensity toward such behavior is known.) And that does indeed make the “he’s blackmailed anyway” scenario logically inconsistent.

I read that under a subtext where we were talking about the same blackmail scenario, but, okay, others are possible.

In cases where the blackmail truly seems not to be contingent on its policy, (and in many current real-world cases) the FDT agent will pay.

The only cases when an FDT agent actually will get blackmailed and refuse to pay are cases where being committed to not paying shifts the probabilities enough to make that profitable on average.

It is possible to construct obstinate kinds of agents that aren't sensitive to FDT's acausal dealmaking faculties. Evolution might produce them often. They will not be seen as friends. As an LDT-like human, my feelings towards those sorts of blackmailers is that we should destroy all of them as quickly as we can, because their existence is a blight to ours. In light of that, I'm not sure they have a winning strategy. When you start to imagine the directed ocean of coordinated violence that an LDT-aligned faction (so, literally any real-world state with laws against blackmail) points in your direction as soon as they can tell what you are, you may start to wonder if pretending you can't understand their source code is really a good idea.

I imagine a time when the distinction between CDT and LDT is widely essentially understood, by this time, the very idea of blackmailing will come to seem very strange, we will wonder how there was this era when a person could just say "If you don't do X, then I will do the fairly self-destructive action Y which I gain nothing from doing" and have everyone just believe them unconditionally, just believe this unqualified statement about their mechanism. Wasn't that stupid? To lie like that? And even stupider for their victims to pretend that they believe the lie? We will not be able to understand it any more.

Imagine that you see an agnostic community head walking through the park at night. You know it's a long shot, but you amble towards him, point your gun at him and say "give me your wallet." He looks back at you and says, "I don't understand the deal. You'll shoot me? How does that help you? Because you want my wallet? I don't understand the logic there, why are those two things related? That doesn't get you my wallet."

Only it does, because when you shoot someone you can loot their corpse, so it occurs to me that muggers are a bad example of blackmail. I imagine they've got to have a certain amount of comfort with actually killing people, to do that. It's not really threatening to do something self-destructive, in their view, they still benefit a little from killing you. They still get to empty your pockets. To an extent, mugging is often just a display of a power imbalance and consequent negotiation of a mutually beneficial alternative to violence.

The gang can profit from robbing your store at gunpoint, but you and them both will profit more if you just pay them protection money. LDT only refuses to pay protection money if it realises that having all of the other entangled LDT store owners paying protection money as well would make the gang profitable enough to grow, and that having a grown gang around would have been, on the whole, worse than the amortised risk of being robbed.

I see. Just running with the premise as it stood.

I haven't read it, but Vanguard wrote about how it loves HFT. A lot of what I know is from Matt Levine, but he is such a fragmentary blogger that he probably doesn't say much in one place and it's hard to find any particular thing he's written.

Your abstractions like "benefit" seem confused to me. Where is money flowing? How?

By the biggest players, I mean investment firms. I thought that the biggest investors are bigger than the exchanges, but maybe they're only equally big. For example, BATS and Fidelity both have a market cap of $60 billion (NASDAQ $14B, NYSE $6B).* HFT firm Virtu has a market cap of $5B. That is, the net present value of the profits Fidelity extracts from its retirement accounts is $60B, while the NPV of the profits BATS extracts from all retirement accounts in the US is about the same. BATS allows (and subsidizes) HFT because it thinks that Fidelity wants it. That's what BATS says and that's what Fidelity says. Maybe they're lying and actually BATS has market power to extract money from Fidelity, but I'll get to that later. [And why would Fidelity go along with such a lie?] [* looking up these numbers again, I find completely different numbers. But they're roughly right if we swap NYSE and BATS.]

Transaction costs are way down. This is easily and objectively measured in terms of bid-ask spreads and trading fees. This is money that is not going to the middlemen, neither exchanges nor market makers, but is saved by the investment firms, which is why they love HFT. There is a more subtle argument that market liquidity is an illusion that will go away "when it matters" and produce flash crashes. I think that this is also false, both painting too rosy a view of the past and exaggerating the damage caused by flash crashes, but it is much harder to argue about rare events.

HFT and running exchanges are not terribly lucrative businesses, not by the standards of Wall Street. HFT makes orders of magnitude less money than market makers made (in aggregate) even 20 years ago. Individual HFT firms make a lot of money, but there used to be a huge number of market makers who specialized in very small numbers of stocks. When HFT first appeared and drove out these people, they reduced the aggregate money going to market makers and the small number of HFT firms have continued to compete away their own profit. This is a pretty simple metric that is exactly opposed to many common stories. It's not that simple because many of the market makers were vertically integrated into firms that did other things, so it's not that easy to aggregate the market makers. In particular, I claim that's what Brad K's old job was (understanding market structure and making money off of the difference between markets, allowing the rest of the firm to think in terms of stocks, not markets). If you buy that, it makes the old market makers look even more bloated and thus the new HFT look even more efficient, but I don't claim that it is obvious.

But are you saying that Lewis is saying that the exchanges are sucking all the profits out of the HFT? I don't think that exchanges are very lucrative (see numbers in beginning). Does he give any numbers? I think that there are only about 4 companies running exchanges in the US (including IEX), which doesn't sound very competitive. But that's because they keep buying out new exchanges, so it can't be that hard to enter the market. And they keep the exchanges around, so they do see value in diversity. IEX being the 12th exchange and the 4th company does make the market more diverse and competitive, but they're probably only fill a small niche. Whereas the dozens of dark pools are already very competitive.

What does the law of small numbers have to do with few people posting in "The Welcome and Open Thread" in the beginning of January of 2019? (A claim which would be nice to compare against the usual amount of posting in The Open Thread in January, and what factors are in effect.)