From: Vincenzo lozzo Sent: Sunday, August 17, 2014 2:21 PM To: jeffrey E. Subject: Re: Taxes Sorry for the email flood but one inte=esting side effect of a public digital currency is that your trading strate=y can be 'anomaly detection on executives spending habits' - which is an ar=itrage as long as you know more identities (wallets) than anybody else play=ng the same game Sent from my (phone =br>On 17/ago/2014, at 09:09, "jeffrey E." <[email protected] <mailtojeevacation=gmail.com» wrote: risk tolerance, can be accomplished by der=vatices. , arbitraged for mis pricing, risk is never really red=ced without a corresponding reward adjustment, howevr, tax allo=s certain arbitrage, for ex gains at 20 -losses at 30 Percent .=nbsp; review monte carlo simulations, need resource , bank, fri=tion charges. read fooled by randomness. On Sun, A=g 17, 2014 at 9:02 AM, Vincenzo lozzo w=ote: Can you let me know if y=u are? I'd be helpful if we can meet up - I'm trying to look at derivatives=through my lens. What is somewhat striking is that it seems like all they=are is a programming language whose goal is to minimize risks (with the sid= effect of creating arbitrage and speculation opportunities). What I am is if you interpret trading as an optimization=problem of: given a belief(stock X will outperform the market, etc etc) max=mize returns and minimize risks. Then all derivatives are is 'functions' to=go from a risky bet to a less risky one - now you can go to riskier ones bu= that's an 'anomaly' Anyhow if this parallel somehow holds there are interest=ng questions that come up, for example: what is a Turing machine in this wo=ld? Which would be a fancy way to answer the questions: what derivatives ar= missing? Also since you can stack up multiple 'functions' (eg: combine a f=rward with an interest float-to-fixed swap to make a riskless arbitrage) th=t leads to complexity and hence to bugs But I'm not sure if this is me going insane/trying to fo