“Joseph Plazo on the Dangers of Algorithmic Obedience: Who Controls the Machine?”
“Joseph Plazo on the Dangers of Algorithmic Obedience: Who Controls the Machine?”
Blog Article
Inside the Asian Institute of Management, Joseph Plazo—founder of the algorithmic trading firm Plazo Sullivan Roche—broke the rhythm of praise for AI with a moment of reckoning.
From Manila, where financial optimism runs high — What he offered instead was something rarely heard in AI circles: resistance.
“The machine may be faster. But are we still the ones deciding what matters?”
???? **He Built the Bot. But He’s Not Sure We’re Ready for It.**
Plazo is not new to this space. His firm’s AI systems have posted a 99% win rate across key timeframes and are in use by institutional clients across Europe and Asia.
Yet even with these results, he insists—performance isn’t the only metric.
“AI can optimise a mistake to perfection if no one stops it.”
He shared a case from the early days of the pandemic. One of his firm’s bots flagged a short on gold just before the U.S. Federal Reserve issued an emergency policy shift.
“We overrode it. The algorithm was correct—but profoundly unaware.”
???? **Machines Act Fast. But Leadership Sometimes Waits.**
AI’s appeal lies in its instant execution. But at what cost?
“Friction is not failure,” Plazo told the audience. “It is the space where judgment lives.”
Plazo introduced a check here framework he calls **“Conviction Calculus”**—three questions that must be asked before executing an AI recommendation:
- Who takes responsibility if the code is flawless—but the outcome disastrous?
- Is there non-digital confirmation? What do experience, memory, and culture say?
- Can we stand by this choice if it goes wrong—publicly, transparently?
???? **As Fintech Booms, Where Are the Ethical Guardrails?**
Across Asia, nations are investing heavily in fintech and AI-driven innovation. From Singapore to South Korea, the push toward automation is framed as economic strategy.
But Plazo’s question cuts deeper: “AI is moving capital—but is it moving it in the right direction?”
He cited the 2024 collapse of two Hong Kong hedge funds.
“No one made a mistake. But no one questioned the machine either.”
???? **A New Path: Machines That Listen as Well as Compute**
Plazo is not anti-AI. He’s pro-responsibility.
His firm is developing what he calls **“narrative-integrated AI”**—models that factor in geopolitics, tone, and social context alongside market data.
“Machines that don’t just predict, but understand.”
Regional investors are exploring what responsible algorithmic finance might look like.
One investor called Plazo’s talk:
“A reminder that the tools we build still need human hands at the wheel.”
???? **The Collapse That Could Begin in Silence**
Plazo ended with a thought that may echo across boardrooms:
“The next crash won’t come from fear,” he said. “It’ll come from logic—executed too quickly, by systems no one dared to question.”
No dramatic flourish. Just clarity.
Because when machines take over the trades, someone must still own the consequences.