April 1, 2016
Xu had consistently produced returns that were truly unbelievable: His worst-performing fund had grown by nearly 800 percent in five years. He had also survived countless corruption investigations, market falls, purges and other scares. Yet even as his legend grew, Xu remained intensely secretive. ... That equilibrium seemed certain to crumble on June 12, when the Chinese stock market began a free-fall. In the span of three weeks, the market lost a third of its value. ... Unlike in the United States, where institutional investors dominate the market, China’s 200 million mom-and-pop investors make roughly 85 percent of all trades. ... “All these small individual investors are called ‘chives’ in the market,” says Hong Yan, a finance professor at the Shanghai Advanced Institute of Finance. “They get cut over and over again, but they come back every time, like little weeds.” ... By the late 1990s, he became the unofficial captain of a group popularly known as the Ningbo Death Squad. The squad made its reputation by manipulating cheap, relatively unknown stocks, which in the Chinese market are not allowed to rise or fall more than 10 percent in a single trading day. To game the system, the squad devised a strategy: Out of nowhere, it would place a gigantic order for a chosen stock. Other traders, seeing the sudden upward movement in price, would flood in, pushing the stock toward its daily 10-percent limit. Once the stock hit the limit on the first day, the momentum became self-perpetuating. Eager traders rushed to buy the stock as soon as the market opened the next day, propelling it toward the 10-percent limit once again. The movement generated its own publicity and easy profits. After a few days, the squad would sell out, and the stock would tumble back to a lower price as other traders followed. ... “Xu Xiang is always trading,” a longtime friend said. “If he’s not trading, he’s thinking about trading.” ... Nearly every one of the experts I spoke with repeated some version of the same rumor: that Xu was less a financial genius than a puppet of even larger powers. Most often, this explanation was deployed in response to a question that had been troubling observers of the Chinese financial world for months: Why hadn’t Xu stopped earlier? Rumors of his illegal methods were an open secret, and he had already built the most successful hedge fund in China, reaping billions of dollars in personal wealth in the process. Why keep going and risk a reckoning?
Ubiquitous computing and automation are occurring in tandem. Self-operating machines are permeating every dimension of society, so that humans find themselves interacting more frequently with robots than ever before—often without even realizing it. The human-machine relationship is rapidly evolving as a result. Humanity, and what it means to be a human, will be defined in part by the machines people design. ... A distrust of machines that come to life goes back at least as far as tales of golems, and this uneasiness has remained persistent in contemporary culture. ... While doppelgängers, golems, living dolls, and automata are all ancient, the word “robot” is not even a century old. It was coined by the playwright Karl Capek in “R.U.R.,” short for Rossumovi Univerzální Roboti, or Rossum’s Universal Robots, in 1921. “R.U.R.,” which tells the story of a global robot-human war, also helped set the tone for the modern conception of robots. ... After Capek brought “robot” into the lexicon, it quickly became a metaphor for explaining how various technologies worked. By the late 1920s, just about any machine that replaced a human job with automation or remote control was referred to as a robot. Automatic cigarette dispensers were called “robot salesmen,” a sensor that could signal when a traffic light should change was a “robot traffic director,” or a “mechanical policeman,” a remote-operated distribution station was a “robot power plant,” the gyrocompass was a “robot navigator,” new autopilot technology was a “robot airplane pilot,” and an anti-aircraft weapon was a “robot gun.” ... Today, people talk about robots in similarly broad fashion. Just as “robot” was used as a metaphor to describe a vast array of automation in the material world, it’s now often used to describe—wrongly, many roboticists told me—various automated tasks in computing. ... a future that many people today simultaneously want and fear. Driverless cars could save millions of lives this century. But the economic havoc that robots could wreak on the workforce is a source of real anxiety. ... The rise of the robots seems to have reached a tipping point; they’ve broken out of engineering labs and novelty stores, and moved into homes, hospitals, schools, and businesses. Their upward trajectory seems unstoppable.
If you made a movie about a laid-off, sad-sack, fiftysomething guy who is given one big chance to start his career over, the opening scene might begin like this: a Monday morning in April, sunny and cool, with a brisk wind blowing off the Charles River in Cambridge, Mass. The man—gray hair, unstylishly cut; horn-rimmed glasses; button-down shirt—pulls his Subaru Outback into a parking garage and, palms a little sweaty, grabs his sensible laptop backpack and heads to the front door of a gleaming, renovated historic redbrick building. It is April 15, 2013, and that man is me. I’m heading for my first day of work at HubSpot, the first job I’ve ever had that wasn’t in a newsroom. ... Arriving here feels like landing on some remote island where a bunch of people have been living for years, in isolation, making up their own rules and rituals and religion and language—even, to some extent, inventing their own reality. This happens at all organizations, but for some reason tech startups seem to be especially prone to groupthink. Every tech startup seems to be like this. Believing that your company is not just about making money, that there is a meaning and a purpose to what you do, that your company has a mission, and that you want to be part of that mission—that is a big prerequisite for working at one of these places. ... Another thing I’m learning in my new job is that while people still refer to this business as the “tech industry,” in truth it is no longer really about technology at all. “You don’t get rewarded for creating great technology, not anymore,” says a friend of mine who has worked in tech since the 1980s, a former investment banker who now advises startups. “It’s all about the business model. The market pays you to have a company that scales quickly. It’s all about getting big fast. Don’t be profitable, just get big.”
The fake title was just the tip of Lustig’s deceptions. He used 47 aliases and carried dozens of fake passports. He created a web of lies so thick that even today his true identity remains shrouded in mystery. On his Alcatraz paperwork, prison officials called him “Robert V. Miller,” which was just another of his pseudonyms. ... His most successful scam was the “Rumanian money box.” It was a small box fashioned from cedar wood, with complicated rollers and brass dials. Lustig claimed the contraption could copy banknotes using “Radium.” The big show he gave to victims was sometimes aided by a sidekick named “Dapper” Dan Collins, described by the New York Times as a former ‘circus lion tamer and death-defying bicycle rider.’ Lustig’s repertoire also included fake horse race schemes, feigned seizures during business meetings, and bogus real estate investments. These capers made him a public enemy and a millionaire. ... America in the 1920s was infested with such confidence rackets, operated by smooth-talking immigrants like Charles Ponzi, namesake of the “Ponzi scheme.” These European con artists were professionals who called their victims ‘marks’ instead of suckers, and who acted not like thugs, but gentlemen.