Quantum duh dum dum

Finance and technology have been partners for decades.  Banks began automating bookkeeping as far back as 1959.  Then the Automated Teller Machine (ATM) materialized at about the same time young people donning hippie fashions overran the Haight-Ashbury neighborhood of San Francisco.  Then their partnership really started moving fast.  An automated stock exchange cropped up, Bloomberg terminals were invented, and artificial intelligence started detecting fraud, all in the final three decades of the previous century.  High frequency trading started early in the next 100-year period and started comprising the majority of exchange volume in 2008.  Now we have mobile banking available virtually anywhere around the globe.  And there is more to come. 

According to this article from The Economist, financial firms are jumping into quantum computing.  These machines use quantum physics (an explanation on how the universe works at a micro-scale) to perform operations on data, attempting to create useful information to those writing the code.  So far, only relatively simple versions of these computers have been built, but if the technology can be scaled further, solutions for currently unsolvable problems could be the result.  For now, they’re using this computational muscle to solve more mundane issues like credit underwriting and stress-testing their balance sheets in preparation for audits.    

Finance isn’t the only area looking to use faster processing power to its advantage.  For instance, aerospace, chemical and even pharmaceutical firms want to cut research expenses by using computational power to simulate new materials, chemicals, and drugs.  These could cut costs and minimize the need for physically handling potentially hazardous mixes that are unproven, and possibly cutting the time needed to find viable solutions in a variety of fields. 

Technology has been a good partner for human endeavors. Finance will continue benefiting as will other segments of the economy.  The accelerating nature of it all is exciting, and the power of exponents could start revealing the fruits of faster processing capabilities in this decade.  There will be pitfalls (remember the flash crash in 2010), and dystopian narratives will flourish as the future unfolds, but the advantages seem likely to outweigh the costs.