Robert Harris's Rogue Algorithm Trades on Fear, Makes Millions: Interview
Comment of the Day

November 02 2011

Commentary by David Fuller

Robert Harris's Rogue Algorithm Trades on Fear, Makes Millions: Interview

If you are feeling a bit blasé about these calm, orderly markets, perhaps this book will get the adrenalin flowing:
Imagine the killing to be made right now if you could find a way to capitalize on fear. That's precisely what Dr. Alexander Hoffman does in Robert Harris's gothic new thriller, "The Fear Index."

The physicist-turned-hedge-fund-manager unleashes a trading algorithm that feeds on human emotions to predict market fluctuations. In just a week, VIXAL-4 makes a profit of $79.7 million. Then, on May 6, 2010 -- the day of the so-called flash crash, when the Dow briefly dropped 9.2 percent -- it goes rogue, catapulting its creator into a paranoid universe of murder and market mayhem.

"The fund is like a malevolent creature," says Harris, 54, the author of bestselling novels including "Pompeii," "Fatherland" and "The Ghost," the basis for Roman Polanski's movie about a thinly veiled Tony Blair. Speaking from the depths of a leather chair in a London hotel, he shares some of his own anxieties over club sandwiches and lounge music.

Anderson: What inspired the switch from historical and political thrillers?

Harris: I see myself as writing books about power and this is the same -- it's all about control.

A dozen years ago I wanted to write a version of George Orwell's "1984" in which the threat to the individual wasn't the state, but rather corporations and computers. I got very interested in artificial intelligence. It wasn't until the financial crisis that I realized I could marry finance and computers.
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