Silence Like Diamonds – Episode 4: Following the Money

This is the fourth installment of a ten-part science fiction series, running Tuesdays and Fridays on Light Reading this summer. Need catching up? Start here:

Silence Like Diamonds – Episode 1: Family Business

The small square of light on the wall expanded into a doorway-sized rectangle, within which Joy Sobretu sat on a barstool-height chair, smiling expectantly. She was rendered at noticeably less than full resolution, looking slightly undetailed and geometric. Her light brown skin was too smooth; her hair, though rendered in individual strands, returned too quickly and completely to its style when she moved her head. Markus's defense software must be using much of the bandwidth. That was comforting; Markus was 20 seconds away if stuff went all weird.

"Thank you for allocating us this time." Sobretu tucked some stray hair behind one ear and smiled warmly. "If you need anything, drop us the word, and we'll arrange it through Markus Adexa."

She was reminding me that they were constantly tracking me. I waited, not letting nervousness lure me into small-talking and losing possible information.

Sobretu's face froze for a longish second; it dropped the "human warmth" vibe when it spoke again. "If we provide you with NItCo's own analysis, will it disturb your process?"

"Tell me what you think is happening."

The Sobretu avatar shimmered momentarily and became an almost-still, less detailed, more cartoonish image, still 3D, but with more regular planes and curves in the small details. The slightly less well-simulated voice said, "Here's the structured version with graphics. Supporting data will download in background." Sobretu vanished.

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The presentation was well-produced but the content was just a data analysis of the most obvious hypothesis: by shutting down so many of the panoply of routine penetrations, unauthorized leaks, backdoor monitors, electronic and human spies that rendered the guts of every modern corporation transparent, NameItCorp's mystery benefactor had improved the efficiency of operations. Like any modern company, NItCo budgeted for the routine costs of involuntary transparency. Reducing those routine expenses caused NameItCorp to make slightly more money and perform slightly better in fulfilling its billion contracts per month. As NameItCorp's expected performance went up and costs went down, they could bid higher on every little contract, whether to arrange a dog-walker for a bereaved dachshund, hire an orthodontist in Tashkent, or assemble a team to excavate a paleolithic settlement sitting on top of a dinosaur find under a planned hyperloop station.

But though the mystery benefactor's blockage of espionage was raising NameItCorp's estimated value, it was also reducing the reliability of the estimate. Modern vendor-search software assigned much higher reliability to data from espionage. A drastic decrease in backchannel information decoupled the relation between perceived quality and trust.

Conventional theory said that better quality of delivery would enhance NItCo's profits, so long-term investing algorithms were buying the company's securities. Using the same conventional theory, short-term investing algorithms saw soaring uncertainty destroying estimated value, and were selling. Most mutual funds used an optimized mix of long- and short-term algorithms, so NameItCorp securities were churning rapidly, often many times through the same funds in the same day. I'd already been dead certain something like that must be happening, and the presentation moved along quickly, saving me an hour or two of having to mess around in the data and confirm that.

Next Page: Who Benefits?

Then it got interesting.

NItCo's research team had looked at the hypothetical position of an insider who knew this was being done. Could that person predict either sharp rises or sharp declines in NItCo securities? You could make money going up or down, but to exploit this as insider information, you had to know which it would do next, and how soon it was likely to change again.

They couldn't.

Any predictive function that could figure out the balance between short-run dumping and long-run grabbing was well into its chaotic range. All that motion the opposition was creating was too unpredictable for anyone to make any money.

To create an artificial security wall around a corporation with many billion entry points and keep it going for more than a week was insanely costly. Something had to be paying off. But securities manipulation was definitely out.

So who else would make money on all that churn?

The obvious answer was brokers. If your money comes from commissions per transaction, then jacking the number of transactions... could that be enough? There would be thousands to millions of brokers who could handle any given transaction, but if you could load up enough clients with enough NItCo stocks, bonds and options, and then keep shuffling them between clients, picking up a commission in each direction, maybe...

I started to talk fast, saying, "Read body" after a moment so that the system would pay attention to my gesturing. Soon I was standing in the middle of the room, waving around with my whole body as if I were conducting an orchestra while directing traffic in a swarm of bees. I get into data analysis with my whole body; I'd get into it with my whole soul if they'd just build soul-interpreting software.

Things started to flow and shape together; homologies, correlations, and eigenvectors took shape in the dozens of inchoate graphs I had tossed up, and the immense, tangled, multicolored network on one wall collapsed repeatedly into simpler, more symmetrical structures. The representation of the overall process had begun to make a certain limited amount of sense.

Right there, smack dab in the middle of one transaction graph, was a dense red ball that represented brokerages doing almost nothing but trade NItCo. I didn't know if they were the culprits, but I did know that they were benefiting more than anyone else on Earth. I drew a lasso-net around it with my hands, compressed the net, and said, "Identify business entities in this locus."

"Only business entity in this locus is AtlantiCrossers. Type of business, brokerage. Privately held. Disclosed ownership is Zalodny Integrated Security."

The company I worked for exclusively.

Yazzy and Dusan's business.

Not only was the mystery benefactor taking care of NItCo's security for free, and better than anyone else; it was pouring the profits into a dummy company owned by my family.

Or the mystery benefactor was my family.

Next: Silence Like Diamonds – Episode 5: Circular Trail

— John Barnes is the author of 31 commercially published and two self-published novels, along with hundreds of magazine articles, short stories, blog posts and encyclopedia articles, so he likes to describe himself as an extensively published obscure writer.