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True, we absolutely couldn’t allow a place that people can voluntarily participate in to say things to exist without a governing body deciding what is and isn’t allowed to be said

“Financial derivatives” and “downside is limited” should never appear in the same sentence without strong conditions on what sorts of derivatives/ combos of them


Jane Street is one of the slower market making firms and generates a significant share of revenue from being everywhere on everything (MUCH easier said than done). You want to trade some Canadian lumber ETF? Jane Street will be there. Some bond product with constituents that trade across 3 different trading sessions? Jane Street's active in that market. None of that is to say they don't have any presence in major products or don't have real short term alphas/edges of course.

They've never been at the forefront of latency games, like Jane Street isn't the firm sweeping equity markets since they have the fastest radio network out of CME (dubious value) or getting their quotes first-in-line every time.


People who don't want to X can always find a reason not to, for any given X. Somebody might even talk about how they want to do X, and go through many of the motions and preparations, but always find some reason at the end to back out.

Is Paul's statement much different from the statement "talk is cheap"?


No, but I think the more salient point to his post is to underscore the previous reasons — all of which came to naught.


No, if I had to nitpick, I'd say 'talk is expensive'. The original text doesn't say "Somebody might even talk about how they want to do X" like your comment, and it doesn't need to. But maybe someone who finds 'some reason not to do' will say it, and they won't actually do it.

(B has never said he wants to learn to code)

A: Do you have any plans to learn to code? It seems to be useful.

B: No.... (thinking) Well, AIs.

(And B doesn't learn to code in the real world)

Actually, this comments doesn't matter at all, but I leave it in for fun


Though I think it should be “for any given Y”. As X refers to the thing avoided, and Y (or any variable other than X) would refer to the excuse given.


Came here to say just this. Glad someone else saw it.


How is

> How do you justify using AI for your game art? I have thought about this, and couldn't justify it. I also know that I hold on to morals almost to a stubborn degree.

different from

> How do you justify using Blender for your game art? I have thought about this, and couldn't justify it. I also know that I hold on to morals almost to a stubborn degree.

Aside from a vague implication that it is immoral to use an AI tool instead of <some other tool> to generate your own game art?


I've thought about this, and it's true Blender allows you to take a lot of shortcuts to be creative, like displacement based on generated noise. It has made work faster, and probably cut some low paying modeling jobs, because those automated shortcuts it has do things better and faster.

The distinction is that it's a widely accepted tool, and you still need to devote time to learn to use it good enough for you to be able to make satisfying art. It's like a brush for a traditional painter, only in 3d. In another comment below I explained a bit more why I value the amount of work seen in art.


I think an important distinction in good or poor quality AI art is similar to good or poor quality models made in Blender. A modeler can spend hours or days on a model; testing different cuts and resolutions and extrusions etc to get it just right. Similarly, the difference for AI generated assets will come down to how much time the prompt engineer will spend tuning their prompts, looking into different models, possibly training models for specific styles and outcomes, regenerating over and over again to get things just right.

On the other side, you have the modeler who barely sticks six rectangles together as a “human” and the AI art prompter who ships the first image they get back.

To me, neither is a moral issue. They both require using tools effectively.


People who have some understanding of study design and data collection would be in a much better spot to understand and interpret day-to-day news / “information flood” than those who have done a lot of calculus-based probability. You can go all the way through rigorous measure-theoretical probability and come away with almost nothing useful for interpreting a study.

Most problems I see with moderns statistics aren’t of the form “ohhh, they fooled you by using a subtly wrong statistical metric to ascribe significance” but “the way the data was gathered/interpreted is fundamentally wrong and made to mislead”


Some of the problems come from statistics itself. “All models are wrong, but some are damn hard to interpret.” Let’s make that a corollary to Box’s statement about the utility of models. Why does so much statistical analysis take place without even an expectation of human comprehension? It’s just magical sigils for most papers.

Many midlevel statistical practitioners suffer from a holier than thou complex, where a “correct” approach to statistical analysis might buy a little more precision at the expense of a lot of comprehension.

Box plots or Bar charts with error bars, using randomized data collection. That’s like 90% of the interpretive value right there. Statistics is a UI for math and it could use improvement if we expect so much from it.

See Brett Victor’s “Kill Math” for more context on why we should expect more from our mathematical interfaces. http://worrydream.com/KillMath/


> "Math" consists of assigning meaning to a set of symbols, blindly shuffling around these symbols according to arcane rules, and then interpreting a meaning from the shuffled result. The process is not unlike casting lots.

Form that Brett Victor.

Wow


@dr_dshiv Edit: Sorry about the bad quote, I should have included the prefix "When most people speak of Math ...". And the negative comment about the blog post.

Now I've read / skimmed all of it and it was interesting, I hope the new methods he wants to use for teaching maths will work fine. (I'm sceptical, but still seems like worth to give it a try.)

I think his project title does his project a disservice: "Kill maths"? That sounds silly to me. And how it starts -- I got annoyed and stopped reading (until I went back two days later).

Another more positive project title maybe could be "Maths for everyone" or "A new approach for teaching maths"?


This is not true, you can run non-send futures using Tokio: https://docs.rs/tokio/latest/tokio/task/struct.LocalSet.html


Quant firms at least are one of the few places where noncompetes can make sense. It's an extremely IP sensitive industry with stupendously high pay where the employee is going to someone probably competing very directly with you, for the same/similar opportunities. Actual code + NDAs banning literal reimplementations of stuff aren't that valuable, the knowledge and ideas will stay in the head of the employees.

The two main issues I have with them are that firms tend to give them to just about everybody (instead of just to folks working very directly with real IP), and they only pay base salary, not something closer to actual total compensation (often multiples of the base pay).

Having said that, the quant firm is relatively unimportant and not a good reason to prevent a total noncompete law. It's probably better to just ban them then try and make allowances that aren't full of loopholes.


> Quant firms at least are one of the few places where noncompetes can make sense. It's an extremely IP sensitive industry with stupendously high pay where the employee is going to someone probably competing very directly with you, for the same/similar opportunities.

Cry me a river. If knowledge of some particular employees worth so much to the quant firms, then they should pay them not to leave accordingly.


Employees don't hold ownership of that intellectual property, though. You're speaking almost in terms of a moral right; IP rights are legal rights of convention. An employee isn't entitled to them in the same way.


Right, and you don't need a non-compete to go after former employee stealing your IP.


Non-competes and NDAs are literally the mechanisms that companies try to protect their trade secrets. Patents, copyrights, etc cover publically disclosed IP.

The OP was about how non-competes make sense in an IP-intensive field, like quant finance. The reason is that these contracts help protect the IP by explicitly stating their case. Your comment goes against the very foundation of IP law: creating reasonably fair commercial opportunities. If I can extort you because you hired me and I learned your secrets, I think that pushes the scales beyond "reasonable."


If you are making $10 million a year based on an employee's personal contribution to the company, and paying them $135,000, they are likely underpaid, and another company might gladly pay them $250,000 to add $10mm to their bottom line. But the non compete holds them in the job paying less. Their value to the company clearly allows them to pay $250k to that employee, but it's the non-compete that is allowing the company to profit an additional $120k. There's no case for non-compete beyond "excessive profit margins".


Merely having knowledge of a profitable trading strategy is not at all the same as having invented it, or even being capable of doing so.


The short answer is "inevitable disclosure doctrine" that prevents you from working for a competitor if it's inevitable that you will disclose trade secrets. It's a sticky wicket for engineers.

However, this might be confusing different issues. My comment was specific to using NDAs/non-competes to protect trade secrets. This is different from merely using them to prevent poaching by competitors. In cases were there isn't inevitable disclosure, I think it's much less likely that a non-compete would be enforced in court.


I totally agree that if an employee adds $10M or $1M to the bottom line and you're paying him $100k, that's under compensation.

But there's a categorical difference between that situation and when an employee or dozens of employees who may be a break even or negative impact on profits have knowledge of a trade secret researched by a team of their predecessors that makes the company $100M.

I'm all about fair compensation and worker's rights, but a business shouldn't have to pay all those people $100M salaries.


You can certainly pay them the duration of the noncompete at their prevailing wage.

In fact, this already exists. https://en.wikipedia.org/wiki/Garden_leave

It really should be required of all noncompetes.


No, NDAs are the tool to stop your employees leaking information. Non competes are the tools you use to avoid paying market price for your employee.


It depends. Some jurisdictions blur the lines between NDAs and non-competes. For example, in many areas NDAs can also prevent you from working for a competitor due to "inevitable disclosure."


You are arguing with straw man since no one in this thread argued to bad NDAs. To me personally NDA seems to be a reasonable concept while NCA is just a wage depression tool.


The parent comment of the one I replied to was specifically referencing IP as a use case for NCA. You allude to “knowledge” of IP warranting higher pay. Besides, elsewhere it’s discussed how NDAs can act as de facto NCAs due to the inevitable disclose doctrine.


> Besides, elsewhere it’s discussed how NDAs can act as de facto NCAs due to the inevitable disclose doctrine.

And that is much better case than NCA since it would only apply in specific narrow cases and wouldn't prevent a McDonalds employee from working in fast food industry for a year, for example.


I don’t disagree, but considering HN is mostly tech-focused for the purposes of this discussion it’s can be a distinction without a difference. Note how the original thrust of this sub-thread is about tech-heavy IP being grounds for preventing employment with a competitor. Also elsewhere I’ve mentioned how some jurisdictions provide caveats, like refusing to enforce NCAs when an employee earns less than a certain threshold (eg $75k). That covers most of your McDonalds employees while still holding true to the intent of NCAs as it comes to IP heavy industries. Well-crafted laws don’t throw out the baby with the bath water


> I don’t disagree, but considering HN is mostly tech-focused for the purposes of this discussion it’s can be a distinction without a difference.

I disagree. Big tech companies often force employees to sign very broad non-competes ("You can't go to a company that competes with us in any market") which in case of such companies covers almost everything (which tech company doesn't compete with Amazon in some way?). Granted, as far as I know big tech rarely enforces non-competes in case of regular ICs, but I would still prefer NCAs to be unenforceable and let the quant firms argue in courts regarding inevitable disclosure for some specific narrow cases where it is applicable.

> Also elsewhere I’ve mentioned how some jurisdictions provide caveats, like refusing to enforce NCAs when an employee earns less than a certain threshold (eg $75k).

I don't see why salary makes a difference here. Some random FAANG IC also shouldn't be forced to sign a NCA.

> Well-crafted laws don’t throw out the baby with the bath water

What baby? SV "baby" seems to be doing just fine in Cali with unenforceable non-competes.


What you’ve highlighted is that you’re having a different discussion than the OP. That post specifically said there are use cases where NCAs protect IP. You highlighting when they are used elsewhere doesn’t negate that point. And there are significant cases on the news where an employee steals trade secrets and takes them to a competitor (see Levandowski among others). It comes across like you have an axe to grind rather than making a thoughtful point.


> That post specifically said there are use cases where NCAs protect IP. You highlighting when they are used elsewhere doesn’t negate that point.

I consider my position (employers can and should use other mechanisms to go after employees that _really_ stealing their IP instead of forcing NCAs on every random McDonalds employee or even junior tech IC) valid reply to position stated by OP. I stand by my words.

> And there are significant cases on the news where an employee steals trade secrets and takes them to a competitor (see Levandowski among others).

Levandowski example proves my point though since he did it in a state that doesn't enforce NCAs and Google found the way to go after him.

> It comes across like you have an axe to grind rather than making a thoughtful point.

That ad hominem was uncalled for.


It wasn't an ad hominem, it was illustrating how you're side-stepping the actual point being made to cry foul about something different.

To underscore it one more time, we both agree that there are other mechanisms like NDAs that protect IP. However, when used in conjunction with the inevitable disclosure doctrine, these prevent someone from being hired by a competitor. So they are doing the same thing as NCAs in the vein of the OP. If the end is the same (prevent hiring by a competitor to protect IP), your point is a pedantic distinction without a difference. If you disagree, you need to provide a rationale as to why an NDA + inevitable disclosure scenario shouldn't be allowed to prevent hiring by a competitor.

Levandowski's trial was settled before it concluded, so it doesn't really prove much in terms of legality, other than the term "trade secret" is nebulous and companies will use whatever is at their disposal to protect IP. One of the takeaways for many companies is that they need to rigorously pursue NDAs with their employees which, again, would have the same potential consequence as NCAs when inevitable disclose exists.

Your whole argument belies a misunderstanding of IP law.

"If an employee knows trade secrets, they should be paid not to move"

(except, knowledge doesn't equate to IP rights)

"Other mechanisms exist to protect IP"

(yes, except some of those mechanism also prevent being hired by competitors, so it doesn't really do much in terms of changing the outcome in the cases pertinent to this discussion)

"It's dumb to have McDonalds employees sign NCAs"

(smart legislators have already addressed this by refusing to enforce NCAs for lower-salaried employees who aren't at risk of exposing trade secrets)

Rinse and repeat, ad nauseum because you either aren't getting the distinction or don't want to understand it so you can 'stand by your words'.


> Levandowski's trial was settled before it concluded, so it doesn't really prove much in terms of legality, other than the term "trade secret" is nebulous and companies will use whatever is at their disposal to protect IP.

You are being obtuse. It obviously proves that NCA is not required to go after former employee that copied bunch of internal company docs with IP to his flash drive and brought it to direct competitor.

> would have the same potential consequence as NCAs when inevitable disclose exists.

Doesn't exist in Cali, same as NCAs.

> Your whole argument belies a misunderstanding of IP law.

I don't appreciate your ad hominems and overall patronizing tone. This is not reddit.

> except, knowledge doesn't equate to IP rights

Where did I said it does?

> yes, except some of those mechanism also prevent being hired by competitors, so it doesn't really do much in terms of changing the outcome in the cases pertinent to this discussion

Sure it does. NCAs are usually blanket poorly-defined "can't work for any potential competitor" bans. Would be hard to prove in court that Bob-the-senior-front-end that worked on Gmail interface enshittifaction in Google for 3 years could suddenly disclose some trade secrets to Amazon even if signed an NDA. For NCA they won't need to prove anything since the two companies are definitely directly competing.

> smart legislators have already addressed this by refusing to enforce NCAs for lower-salaried employees who aren't at risk of exposing trade secrets

What does it have to do with the salary? If McDonalds employee is promoted to shift manager or something and gets paid slightly past threshold they suddenly shouldn't be able to go work for Burger King? Doesn't make any sense to me.


All of this has already been covered in this discussion. It's tiresome to rehash it.

>It obviously proves that NCA is not required

Already stated: "Non-competes and NDAs are literally the mechanisms that companies try to protect their trade secrets."

To wit, look at what lawyers say are some takeaways from this case:

"Require employees to sign nondisclosure agreements (NDAs)."[1]

Now why would a lawyer say that? Because contracts are easier to uphold in court. But that's already been stated:

"The reason is that these contracts help protect the IP by explicitly stating their case."

And guess what happens when you combine an NDA with inevitable disclosure doctrine? A prohibition from working with a competitor. But that's already been covered here too:

"The short answer is "inevitable disclosure doctrine" that prevents you from working for a competitor if it's inevitable that you will disclose trade secrets. It's a sticky wicket for engineers."

>Doesn't exist in Cali, same as NCAs.

I'm sorry, I know HN tends to be in a bubble, but at no point did I claim California as the sole scope of my comments. Actually, I did the opposite by citing other states, like Illinois regarding their $75k threshold. Regardless, there are still provisions that provide similar relief in CA, like the UTSA.

>This is not reddit.

Ironically, it's your comment that goes against HN guidelines:

"Please don't post comments saying that HN is turning into Reddit. It's a semi-noob illusion, as old as the hills."[2]

>Where did I said it does?

Literally, your original comment I was replying to makes the claim that knowledge equates to deserving more pay:

>"If knowledge of some particular employees worth so much to the quant firms, then they should pay them not to leave accordingly."

We have mechanisms for determining who gets paid from that knowledge. It's an IP license.

>NCAs are usually blanket poorly-defined

I guess if your threshold is poorly defined contracts, then no contract law is relevant. But its a strawman to point to badly formed NCA as a rationale to ban them completely. I'm talking about good contracts, with a meaningful purpose to protect trade secrets. See any of the previous posts to this effect. If your claim is that bad NCAs should be banned, I'm with you. This, however, is not about that.

>What does it have to do with the salary?

As already discussed, contract law is completely about convention and can be changed:

"IP rights are legal rights of convention."

It's relevant because the convention used by IL is that an NCA for an employee below that threshold is "void and unenforceable." In other words, it's not a legal contract.

The fact that you railed against all that despite already being shown while it's wrong and resorting to statements like "it doesn't make sense to me" tells me this is more about you proselytizing than having a reasoned discussion.

[1] https://www.jdsupra.com/legalnews/protecting-trade-secrets-l...

[2] https://news.ycombinator.com/newsguidelines.html


You're suggesting that if an employee wants to change jobs, they should work in a field for which they have less expertise and thus get paid less. How is that reasonable?


That is not what I’m implying. You can work in a similar industry without taking trade secrets, except in the case of inevitable disclosure. For example, if you quit writing for Coke you can still go work for Pepsi without disclosing the Coke recipe.


Knowledge of a secret does not imply that you provide value.


Are you speaking towards the employee or towards the quant firm? If the employee has no standing to claim value, then why does the underlying business get to?


Because they own the trade secret. For example, they have the legal right to license a trade secret; an employee does not. It's about legal ownership of intellectual property.

As a corollary, you may read a patent and now have the knowledge of a product. But you don't have the same legal right to create and sell that product. That right is protected by the patent owner.


Of course, that line of thinking involves the inevitable follow up: when is something a “copy” vs a “genuine invention”. If company has a patent on making widget A, how different does a previous employee who leaves and makes widget B have to be before it’s not considered a violation?

I am no expert here but my understanding is that the case law around this is much more well trodden in patent land than it is for noncompetes


You're right, but there are some nuances that I would expect a good law to address. My presumption is that trade secrets would have to be covered by confidentiality agreements, which are distinct from noncompetes. The threshold for infringement of intellectual property is a "preponderance of evidence"; i.e., it's "more likely than not" or "greater than 50%" so it's not a terribly high threshold to prove compared to other sorts of law.

If it's truly patented (different from a trade secret), you can't produce it, even if your invention is slightly different. For example, if I hold a patent on a "car" and you make a "car with a radio," you still can't produce it because it infringes on my patent. You can't make your product without covering the totality of my claim. That's why people try to make patent claims as broad as possible.


That’s not a very good example. A patent is available to read specifically because the discoverer has entered an agreement with the government to share the relevant information in return for exclusive use for a set period of time.

If they had not patented whatever it is they had, anyone could replicate the information/item in question with no penalty.


>anyone could replicate the information/item in question with no penalty

Sure, I suppose someone could develop/copy something in parallel with no knowledge. But that's not really the case in the discussion here as it comes to former employees.

If you worked for Company A which uses a proprietary algorithm for trading and somehow created the same for Company B later, would you really expect a jury to think the two are unrelated? As stated above, the threshold is "more likely than not" that your work for Company B is related to knowing the trade secrets of Company A. If you had never worked for Company A, maybe, but again that's not the case here because a noncompete would never enter the picture.


> Sure, I suppose someone could develop/copy something in parallel with no knowledge.

I mean that’s a tad disingenuous as to how it worked before patents. Patents were meant to dissuade others from copying inventions for a certain set period. It was much rarer to see independent development of the same technology (not that it didn’t happen).


We agree that it's a rare edge case. That's why the rationale of IP protection works. Before patents, important knowledge was lost because people didn't want to divulge it because they had no IP protection. Back then, everything was a trade/state secret.

I guess I'm not seeing the point made. If you agree it wasn't developed in parallel, you copied it from your previous employer. If it was their IP, you likely committed a civil wrong, and they can sue you. I can only see your point if you don't believe IP exists.


I wasn’t making any point. Just that that the initial patent example isn’t a good one to use.


u/akira2501 was providing a bad equivalency by saying both the company and employee has knowledge of a product, therefore either both (or neither) gets to claim it as property.

A patent is an example that shows why that is a bad principle. The point of a patent is to share knowledge, but it also gives claims of ownership (for a period) to only a specific party. So obviously "knowledge of a product/process" isn't the discriminator. The important portion of a patent that distinguishes what is owned is literally called its "claims." My point is that whether or not you have knowledge does not lay claim to ownership, contrary to u/akira2501's question/point.


clearly there's value in the secret if you're making them sign a noncompete.

The proposal is just to ask firms to put money where their mouths are.


He says that just because someone knows a secret, then it doesnt mean that he brings value/$$$ to the company

They should pay him 500k just because he knows a secret? even if he's making just 50k to the company?


Obviously companies think it is worth a lot for certain employees to be quiet, so they pay accordingly. There is no "should" going on here, there is only what the two parties agree to.


They should pay him whatever he would make going somewhere else. Expecting someone to not work in their career field for 1-5 years and not get compensated for that is silly.


LOL - you have stumbled upon the pay grades for security and executive management directly ! they absolutely are paid more to participate but stay quiet. It is a daily requirement.


A noncompete has value. If its worth 50k then pay for a noncompete equivalent to 50k wages worth of hours. Simple as that.


If someone else would pay them 500k to reveal the secret, then yes. Maybe don't give 500k secrets to people producing only 50k of value.


> Knowledge of a secret does not imply that you provide value.

If it did not provide value to tell the employee the secret then it follows that company would/should not tell the employee the secret.


"Secret" should be covered by NDA and/or patented.


That's the point. If it's covered by an NDA and the state declares NDAs unenforceable, there are no NDA-covered "secrets." I can get hired, learn all your secrets, and then sell my employment to your competitors. That system doesn't really work.

In practice, trade secrets are protected by other mechanisms. Patents are one of them because, by definition, patents are public knowledge so they are no longer secret.


To play devil's advocate here, this law would literally make that illegal. What keeps me from taking the money then leaving anyway? A signed contract is the only way, and banning non-competes means making that contract unenforceable.


…sorry, how much exactly do you think quants make?


Mid 6 to low 7 figs usually. They are usually one "tier" above SWEs i.e. an average new quant would make the same amount as an average mid-level NYC software engineer, in absolute monetary terms of total compensation. The high end firms like Jane Street and Two Sigma pay the equivalent, scaled to FAANG levels. Overall performance of the firm is a key factor in the compensation too.


People sometimes leave and take less money. Plenty of other reasons to change jobs.


For a large team, and finance, there is no amount of pay that could compare to the potential gain of creating your own firm to reimplement some specific idea you learned on the job.

The more likely response then would be to move the team somewhere that does allow non-competes?


You can work at 2 companies without leaving either.


presumably the noncompete wouldn't apply then, if the two companies were not competing, and then you wouldn't need to pay them at all.


to the struggle SWEs who exaggerate your salary on HN and are upvoting this comment to the top: please stop and think for a second


Non-competes have only ever made sense where the employee is compensated for signing. Codifying this change would immediately make companies stop with blanket non-competes, and only have them on key people.

While not impossible, non-competes without compensation are already hard to enforce as judges don't look kindly on preventing people from earning a living. The problem is the asymmetry of power let companies bully and intimidate ex-employees.


I mean yeah that's the point I made? FWIW, trading firm noncompetes are almost always compensated with the base salary and they're still blanket applied. A major contributor is that the employer is only paying a fraction of the true employee compensation, making it easy to blanket apply and creating a form of golden handcuffs.


They're not applied as widely as it may seem. The terms are typically "up to" the length of time, and in practice firms waive 50-100% of the non-compete length pretty frequently, which is a decent sign that the cost is non-negligible. It is a bit tricky not knowing until you quit how long you'll be held to it, though.


If judges start to throw out non-compete agreements that don’t have separate compensation (apart from usually salary/experience), then you will just see companies explicitly write their contracts such that that X dollars are explicitly for the non-compete agreement.

At least in some industries, however, there is a consumer protection/public policy argument against non-compete agreements, where: (1) there is no legitimate property interest to protect (e.g., the “trade secrets” held by the companies aren’t trade secrets at all because every company in the industry knows them), and (2) it is bad for consumers/against public policy to allow companies to use non-compete agreements to stifle competition where there is no legitimate property interest to protect.


Some states create salary thresholds. For example, Illinois law states they won't enforce non-competes for anyone making less that $75k or non-solicitation for anyone below $45k. However, companies are still protected by non-disclosure agreements for important trade secrets.


Yeah, they should be obligated to pay for the length of the non-compete. 1 year? Okay, you're paying me for a year.


Quant firms have already adapted years ago.

Now they don't have 6-24m non-competes anymore, but 6-24m notice periods. You're paid full salary (incl bonus) but you don't work ("gardening leave") and obviously can't work for a competitor (because you can have a non-compete while you're employed).


This seems like the correct and fair implementation of non-competes broadly. If companies want leavers out of the market, they should be required to pay garden leave. People have to make a living, and it’s unreasonable to expect them to change geographies and/or professions to do so.


Firms have always payed garden leave tho


yeah but it used mixed.

E.g. I had 3m garden leave (paid, no bonus) and 3m non-compete (unpaid).


Gardening leave leaves (pun intended :)) the possibility for the employee to leave with highly valuable acquired knowledge (trading strategies, algorightms, etc...) for a much higher salary and bonus than the gardening leave provides. Or maybe I am mis-understanding how gardening leave works? Thanks!


"Gardening leave" just means that during your notice period (or part of your notice period), you're not "working" in the sense of going to the office, but instead you're home ("tending your garden"). The idea is that during that time, you're not gaining new knowledge / IP, so by the time you actually start working your knowledge is several months out of date.


Few of my friends are in quant, but I have never heard anything like this. Can an employee just apply for notice period after a month of joining and be paid 6-24 month of salary?


After a month they wouldn’t know much, so the firm would just let them go. The firm picks the leave duration, not the employee.

And after only a month their sign-on would be subject to claw back.


I dont think employers have to worry about that when the employee works his whole life to be a quant in such a competitive industry.


The length of paid leave is at the discretion of the company, of course.


But can the non compete be longer than paid leave?


So what's the incentive to keep working under those conditions?


I guess bigger and better bonuses in the future?

Like, why would you quite and semi-retire for 1-2 years when you can keep working for like 5 years and actually retire?

(I'm just LARPing, I have been out of the industry for a few years by now...)


I guess it depends where you are in your career. If you're really aiming at a five year time horizon, then I can see it making sense to stick around. But, if you're yonger a year or two fully-paid vacation sounds pretty tempting.


In the financial industry, you don’t get your bonus when you’re on garden leave. This is usually the majority of your pay, so while it’s definitely nice to be paid to do nothing (I’m on garden leave currently until next September), you’re not earning up to your potential.


Other than getting paid without working for 6-24 months? Did I misread?


I think the GP meant why should you work when you can get paid without working.


You could work for a much higher bonus and salary. The way gardening leave has been described here is for people who are not looking to take their highly valuable knowledge somewhere else for higher bonus / salary.


> Quant firms at least are one of the few places where noncompetes can make sense. It's an extremely IP sensitive industry with stupendously high pay where the employee is going to someone probably competing very directly with you, for the same/similar opportunities.

So the solution is that employees should only be able to work for one employer in their career? I wouldn't disagree with this argument if the noncompete came with a payout in the tens of millions of dollars.


It’s reasonably normal to be more like garden-leave where the employee is paid some high percentage of their base salary for some amount of time when they may not compete. This can still be very expensive for employees who will often have bonuses that are a large multiple of their base and so going down to base for the duration of the garden-leave.

Some places won’t compensate for the noncompete at all, others won’t compensate if the person works at a non-competitor. Some have a mix, eg up to a year of (paid) garden leave followed by up to a year of (unpaid) noncompete. If someone does leave one firm for another, there is often some negotiation, eg maybe the hiring firm agrees not to have the person work on certain things for some amount of time (potentially longer than the noncompete) and in return they can get them sooner.

So one solution is to allow noncompetes so long as employees are fairly compensated. It seems hard to discuss improving the rules around fairness there if you’re a politician because quant firm employees are not very sympathetic – it looks bad to say they are mistreated when they make many times more than lots of other professionals, even though by allowing that mistreatment you’re effectively giving the money to their even-better-off bosses instead.


> It’s reasonably normal to be more like garden-leave where the employee is paid some high percentage of their base salary for some amount of time when they may not compete.

Some would use that money and time to start a competing company :)


If you’ve been successful enough at a quant firm that you want to try to set up your own firm, it’s not one year of base pay from garden leave that’s going to be providing your start-up capital.

But also, setting up a competitor is definitely violating noncompete. If you look at how actual firms started (basically all of them start from people leaving other firms) the founders waited out noncompetes. It would be a waste of money and potentially scare off investors by risking getting massively sued.

The things people normally do are like:

- go travelling, especially to places less well suited to short trips. Hard for people with partners who don’t want to stop working for a year or two.

- learn/train for something. Eg maybe requires a bunch of courses or maybe just a lot of time and effort.

- some combination of the above, eg mountaineering requires a certain amount of training/fitness as well as long trips

- some kind of civic/vocational thing where you’re applying professional skills from work but not IP, eg taking a more active role as a charity trustee

- spending more time with kids/other family

- working for some non-competitor like Google for a year.


Lawyers will advise you not to do this. It exposes you to accusations of IP theft and barred competition.


It worked out for the traitorous 8


I feel like the solution is to force the company to pay full TC (average of previous years + inflation or something?) for the duration of the noncompete.


In Germany non-competes have a max duration of two years and compensation has to be at least 50%.


Living two years on half the salary sucks though.


Realistically though, you're never going to have a system where it's generally more attractive financially to spend a couple years on the beach than to keep working. That's a perverse incentive.

But, yes, that's the thing with gardening leave. There are certainly some people who would be fine with taking a year off at significantly reduced pay--but not the majority.


It's a great start into freelancing though. They have to pay you 60% of your former salary upto 110% of it.


You know what would be even better? Them paying you 100% of your salary while you are freelancing ;)


> I feel like the solution is to force the company to pay full TC (average of previous years + inflation or something?) for the duration of the noncompete.

It absolutely has to be something like this at a bare minimum. The whole "We pay full base" argument is nonsense when the TC is multiples of base.


Even this doesn't work because its often the case that an employee leaves for a higher salary elsewhere. Instead of trying to add epicycles to a stupid system it makes more sense to shit can it. There are about 338 million people who would benefit whereas the people who truly have anything to gain from such a system could all attend an event together.


But bonus depends on how the team did plus individual perf... politics.

How do you establish what the person would have gotten paid?


Take the average over the last years? If the employer doesn't want to pay that then the employee can always go work for a competitor, right?


That's why he suggested "average of preceding years". Maybe you allow companies to appeal to reduce the amount based on a decline in profits leading to reduced bonuses for employees on identical schemes, but... Meh. If they want to use non-compete clauses I think they should bear that risk. It will make companies think hard about on whom they should impose them, which in my opinion is the point of creating restrictions.


Right. They can always release them from the noncompete if they find it onerous.


> So the solution is that employees should only be able to work for one employer in their career?

Yes, I very definitely made this anything remotely resembling this argument in my post.

Regardless, it would be a beyond-amazing deal for most employees if they got lifetime yearly TC from a quant firm only on the condition that they didn't work for a competitor. Mindblowingly, shockingly, amazing.


Non-competes should be regulated so the person is paid a full salary (or paid the equivalent of the last year's total comp) if the employer wants to enforce it, and have a max duration say 1 or 2 years. I don't see a problem if it's done like that.


> Non-competes should be regulated so the person is paid a full salary if the employer wants to enforce it, and have a max duration say 1 or 2 years. I don't see a problem if it's done like that.

That's just employment, so its effectively the status quo in places with a ban on noncompetes. You can absolutely hire someone as an employee, when their only job duty is not to compete with you. You can even contract such employment for a set term. The problem, of course, is that employers want noncompensated noncompetes and at-will, no-set-term employment.


It's not just employment because employment can't exclude you from quitting and finding another job, but a non-compete can. Otherwise I agree.


> So the solution is that employees should only be able to work for one employer in their career?

What makes you suggest that? If I understand correctly after you leave one of the quant firms you end up having to spend X months not working in the industry getting base pay. Which seems like a very reasonable deal.


I’ve seen “hostage exchanges” where two firms wave the noncompete (for people already on garden leave) so they can start right away. Seems to undermine the idea that sensitive IP is at risk.


Are quant firms positive sum for society? I can imagine that some trading leads to goods being priced more efficiently or w/e but I doubt the level of alpha these firms are chasing has positive externalities. If not, you should shouldn't really care about this hurting their industry.


You highlight a more general problem: the social/economic function of finance is to be a service industry to ensure there is liquidity available (that other people can use for their purposes).

What bugs me is that somehow society lionizes people in the money industries over those doing equivalent service jobs like gardening, lawyering, much less more important ones like garbage collection.


Society does not do that. They can extract more capital, so they’re considered more important.

If gardeners were paid 500k/year, they would be exalted. It has nothing to do with the work or the value provided to society.

People just love money and praise those that have it.


Worship of the rich is a sickness in society. Like I said, the value of banking is akin to the value of gardening, and worshipping the bankers just enables destructive distortions.


They are a net negative in the sense that you have some of the brightest minds in the country working on derivatives instead of being in STEM labs


They are really not. The growth of financialization coincides with economic stagnation in U.S. If anything, the data shows the opposite. Finance sector is more or less a parasite on the productive economy.


> It's an extremely IP sensitive industry

I know this will not resonate with some, but on some level I do not really subscribe to the idea of intellectual property. My personal belief is that the brain is more like a radio receiver. The ideas are floating out there for anyone to pull down. The more sensitive among us are able better able to hear what is there and report it back to the rest of us. To claim ownership of an idea is to me like claiming ownership of the note A or the pythagorean theorem. Of course there should be some rewards for introducing novel ideas to the world but to me the real reward is the creative experience of bringing something into the world that was previously unknown.

In an ideal world, I do not think that hedge funds (or most fintech) would even exist. It sort of offends me that we would waste our civic resources legally enforcing ip rights. But I also understand that my position is far from universal.


This is an idealized notion (but one I wish everyone could adhere to). In reality, intellectual property rights were considered a necessity for societal progress. Before intellectual property rights, many ideas were lost because they were guarded too tightly. If that person died, those secrets were potentially lost forever and, presumably, society would be worse for it. So we developed IP rights as a way to share ideas in exchange for exclusive rights to them for some time. (This isn't discounting how these laws can be perverted to hurt the original intent).

Likewise, trade secrets are a mechanism to help foster better (and fairer) commercial practices under the guise that society will benefit. It's a pragmatic take rather than an idealistic one.


I think your viewpoint is great and poetic. However, since most people are not as mature as you, our societies are not as mature as you. Meaning that until this fact changes, I do not think it is realist to expect someone to give something for free when they could make billions with it.

You have to be a saint or already have everything you could ever dream of


The only way the someone can make 'billions' is because of the state-given and enforced monopoly on production. Without this required threat of state violence, your ideas start being worth much less in the actually competitive markets.


Why does it make sense. Pay employees for their work and they’ll stick around.


The argument against this is that a company spends millions of dollars in research to learn something valuable, and anyone who didn't spend that money can trivially outbid for the employee that knows the results, since they can pay the employee some significant portion of the cost of the research that they didn't have to do and still come out ahead. I'm not sure I entirely buy this, but it's a lot more nuanced than "just pay your employees well".


this is the kind of noise you get when you decide that an idea is something that can be owned


Then maybe the conclusion is don't spend millions to research that type of thing.


What type of thing? This applies to anything. We need to pay close attention to maintaining rules to foster research and innovation.


Free market for me (to trade securities), but not for thee (to trade your skills).


Free markets allow contracts that are upheld by the government though?


I meant "free market" in the sense of open trades on an exchange. Except for exigent or criminal cases, it's very difficult to undo trades. The "That's not fair"-argument doesn't work except for exigent (circuit breaker halt) or criminal cases.


exactly this. Pay them well, and treat them well and they will stay. This is just another tool that employers use to nickel and dime their employees.


To your point, it's ironic that firms who push a free market ethos don't actually want to compete. Instead, they want a thumb on the scale that tilts the advantages in their direction.

Welcome to Crony Capitalism (which should not be confused with traditional capitalism).


The absence of "traditional capitalism" from history makes it really hard not to confuse it with "crony capitalism".

Perhaps you mean liberalism, as an ideology of capitalism.


Perhaps. But, for example, we didn't always have The Fed. We didn't always have WS. We didn't always have "too big to fail". We didn't always have taxpayer financed bailouts. We didn't always have a top heavy (Fed) government (that has more influence than it has common economic sense).

At yet all those entities verbally champion "free markets" and "capitalism being a superior economic paradigm", Etc. Minds get lulled into the repetition of the words and stop checking the action. Reminders to turn on your BS detectors add some balance. Not much, but some.

Fwiw, I'm speaking freely and in broad strokes. If liberalism would be a better word then sure, whatever helps cut through the BS. Thanks.


Sounds like you are, in "broad strokes", longing after 1870s or something. I think you forgot how crony (or crappy?) it was.

What I am saying, if you really want this "traditional capitalism", which never really existed, you need some mechanism of how to avoid rich getting richer and becoming cronies (as they always did). I don't think you have an idea what such a mechanism should be.


To clarify, crony capitalism is when "regulation" and "oversight" are euphemisms for thumb-on-the-scale rules that result in a less than level playing field. The winners? The cronies.

And back to my previous point about The Fed, etc. We're told that those are "for the greater good" (words) but - and to your point - the rich are not only getting riche (actions),the rate of that wealth transfer (to the top) is accelerating.

We can call it whatever you want. And I'm not saying I want anything. I was simply pointing out that the majority of those - at the top of the financial food chain (e.g., WS) - who advocate for "free markets" are full of shit. They're lying. So maybe to make you happy we shoukd just say: Less Bullshit Capitalism? Will that satisify you??


I think I understand what you're saying, but this has always been simply called "capitalism". The "fake" regulators are simply a response of people with power in the system to societal attempts to fix the most egregious flaws of liberalism (laissez-faire).

You seem to be similar to naive communists, who, in the face of communism turning totalitarian, tried to "save" the idea of planned economy (for instance) by claiming that totality isn't what they wanted. Ignoring the fact that the totality was put up to prevent bad behavior of people and companies, to which the planned economy led to.

Similarly, here you complain about natural consequences of laissez-faire capitalism, without admitting that the latter is the cause.

I am not saying that good ideas in capitalism (or communism) are unsalvageable. But then you need to detail the mechanism of how to prevent the natural course of action (empirically observed) to take place.

(My personal preference would be to replace free market for labor with worker democracy, while leaving most other things up to free market. Although such a system could hardly be called capitalism anymore.)


> I think I understand what you're saying, but this has always been simply called "capitalism".

Perhaps. But just because it's called that doesn't mean it is that. In fact, even crony capitalism is kinda a joke because it's such a perversion it's not even close to capitalism. Manipulation is the antithesis of free markets. Along the same lines, bails outs by defintion don't mean capitalism is a more successful paradigm. That just doesn't make sense.

My favorite way to reframe shameless newspeak is this: If your pet barked, would you still call it a cat? Of course not? So when there isn't a free market for miles, that's not capitalism.

My fav thing would be to see more co-ops. There's no reason why the more workers can't own a piece of the action.


Offering a contract with whatever stipulations to a potential counterparty that he can sign or not sign on his own accord is competing. Forbidding your counterparty from putting certain stipulations in their contract by using government intervention is not.


If they limited the vendor's (i.e., employee's) options, how is the being competitive?

And if the market colludes to handcuff vendors (to the benefit of the hiring companies) how is that being competitive?

Employment is already at will, and that is mutual to both parties. Why should one side be allowed to purposely disadvantage the other side? How is that being competitive?


I read a story in this article about a person being sued after they found another job after they were laid off.

There should be exemptions for non competes when it's the company firing or laying off the employee. When a company decides to do that, they need to be willing to bear the consequences of their decision.


> It's an extremely IP sensitive industry with stupendously high pay where the employee is going to someone probably competing very directly with you, for the same/similar opportunities.

Maybe it should not be IP sensitive. It would be the interest of public to bring more competition to the quant landscape and make their profit margins lower through the competition.


Isn't the same true for SV companies, and aren't they doing fine without noncompetes?


It's often stated as one of the reasons SV exists at all.

So many stories, start with thr traitorous 8


Not only quants can have some good in-depth knowledge and ideas in those firms. As a Software Developer in one of such companies, I do know a lot of sensitive details too. And then, traders who use the software I write - they are very much connected to Quants, thus having lots of valuable ideas in their heads (both of their own and ones they got from Quants).

But for SW devs, the non-competitive agreements in Finance industry isn’t really the same kind of bondage as for Quants. If Quant changes company - his options are very much limited to other companies doing trading, thus directly covered by non-competitive agreement. If SW Dev changes the company - he can choose the company working in other industries not related to finance, and then he is free as a bird.


Of course can be beneficial for individual companies, isn't hoarding up IP an impediment for progress in general?

In this specific industry tough one could argue that impeding progress is a good thing for the wider society.


For those unaware:

Quant = quantitative analyst


Thank you!


Transfer of intellectual property is already illegal. If a quant was aware of something amazing they could try to transfer it anyway - just without taking the employment. Yeah, it’s illegal. So non competes are about the person and the skills the person brings. And fuck that.


It's hard to forget how this stuff works though. It's just theatre.

You obviously shouldn't be able to walk off with a model but especially with hindsight I could bang out some models I've worked on very quickly as long as the infrastructure was amenable


Importantly, even if noncompetes aren't enforced, trade secrets can still be grounds for litigation against a former employee. They can't just go from one employer to another and take all the secret sauce recipes with them.


Based on what? I honestly don’t know and most comments seem to be assuming that’s not the case.

And also in some ventures it might be pretty hard to litigate when everything is done behind closed doors. How would you know if a rival trading firm is using an algorithm influenced by yours or not?


Are you asking under what grounds are trade secrets enforced? In the U.S., that would be 18 U.S. Code Section 1832: Theft of Trade Secrets. The USC are passed by Congress so it's applicable in the entire nation. If you're asking what's the point, the idea is that it helps foster fair competition. Suppose a company founder has to dilute their ownership by taking on millions in investment to finally get a breakthrough. You don't want a system that allows an employee to immediately walk away and start a company of their own with that knowledge and completely undermining those who put in the money and effort for R&D.

But, maybe to your point, just because it's illegal doesn't mean it's easy to litigate. Much of the legal system is specifically to avoid litigation. Apropos to this discussion, even if a contract isn't enforceable, it only has to be perceived as having teeth to give it value. It's like when a baby elephant is tied to a stake and it grows to an adult still thinking that stake prevents it from leaving. All it takes is for an employee to think a non-compete has merit to keep them in place.


Eh. Firms quants work for compete with the public market not each other. Writing an automated trading strategy isn’t targeting specific actors, it’s trying to convert alpha into profit.

I guess there’s a weak argument to make for the HF part of HFTs


If it doesn’t make sense in California’s Silicon Valley, how can it be justified in NYC


Lack of noncompetes is the reason that most trading firms have opened offices everywhere except SF


> how can it be justified in NYC

Wouldn’t it make a whole lot more sense considering what kind of business they are in?


What kind of sensitive IP do quants have? How is it different than the tech industry?


Most tech work is not particularly novel at a technical level. Very few services have any sort of massive advantage in the technical IP. Some of them might have advantage in customer/data analytics, but most advantage is in the idea itself as well as being gaining the market and brand. Another firm can't just go "Ah, today we'll knock out X new app and take 50% of the market"

This is not true in trading. If I go take my strategy/forecast and go to a competitor, I can just outright take the same opportunities that the other desk was taking (to a fairly good approximation). There's no real branding/network effect - it's a pure quality of execution business.


Why is that the employee's problem? Pay the employee well and they will stick around.


The compensation model in investment companies is such that they will not be able to pay employees well compared to how much value they bring in, unless you're a partner.

Furthermore the industry attracts the sort of people who are never satisfied with what they got, and are always looking for more.

Not that I'm advocating for non-competes, just saying that you can't address the concerns non-competes are attempting to address by "paying employees well".


> The compensation model in investment companies is such that they will not be able to pay employees well compared to how much value they bring in

There's definitely an argument here that those companies deserve to be out-competed then.

I'm not saying to ban any of these practices, but the legal system doesn't have to guarantee the feasibility of companies.


Why will they not be able to pay them well? Why can they not measure it unless you are a partner?


General strategies of trading on financial markets. Entirely different than working at Google.


And what benefit does the economy and society get by allowing monopolization of these strategies by a single company at the expense of basic right for workers to switch jobs to the ones that pay them the most?

It sounds so profoundly anti-capitalist - if the knowledge of certain strategy is so important, the employee should be retained by paying them more and giving them better perks instead of enforced labor contract.


I am not defending for or against not sure why you replied to me.

But I think it is slightly silly reading your statements knowing that the individuals in that hyper specific industry are top earners already and educated to know what they are signing up for.


This is exactly the right question. If quant firms make the world a better place by tightening spreads - a common justification - then wouldn't we get an even better place if everyone knew about these strategies?


A counterargument here is the effects on internal transparency. If a quant firm knows its employees can leave and join a competitor tomorrow, they will be less forthcoming with IP. The lack of openness could lead to lower productivity within the firm, as work gets duplicated and teams can't share their insights with each other.


As long as we're throwing around generalized hypotheses, a company that shared internal IP freely, and also compensated people such that they didn't leave, would gain a lasting competitive advantage.


If you can’t protect your IP, you don’t have a reason to develop it in the first place.


The benefit to society is the same as patents or copyright. Companies will be more likely to invest in developing new technology if they are confident their competitors won't be able to use the result.


> if the knowledge of certain strategy is so important, the employee should be retained by paying them more and giving them better perks

This particular suggestion breaks down fast when you have multiple employees that need to collaborate. If you have a million dollar strategy, you can pay half a million to an employee as a retention bonus. But you can't pay half a million each to 8 employees.


I'd say it's the opposite, non-competes (or similar agreements) actually prevent monopolisation.

Otherwise, the biggest firms (e.g. Millenium, Citadel) could simply "buy out" any already-successful researcher, offering them more money (either in terms of % of profit, or - more importantly as it scales with size (for many strategies) - offering more capital to trade with.


> It sounds so profoundly anti-capitalist

Only if you have an extremely vague and poorly defined definition of "capitalist", which I don't blame you, most people are ignorant, and we live in a society that prefers to throw out opinions like they're reality.


So they only make sense in an industry that probably shouldn't be allowed to exist in the first place?


It makes sense for the owners. It doesn’t make sense for the public that Jim Simon’s alone becomes a multi-billionaire off exploiting the financial mistakes of ordinary people.


If it’s rooted in math none of the IP should be protected. The training and definition of axioms and viable algorithms should be an open human endeavor.

Letting capitalism dictate what math is public and private is pretty fucking draconian


It would probably be even worse today. Dynamically discovering ILP “just works” even as memory gets slower and slower and slower. A CPU today can execute hundreds of instructions and many predicted branches ahead of a slow load. It would be impossible to statically schedule this (you don’t know what will/won’t be in cache), and difficult to try and hoist all loads 100 instructions in advance especially when you take branching behavior into account.

GPUs have taken over much of the niche where these processors excel, number crunching where you have entirely pre-determined memory / compute access patterns.


For GPUs it only really works because the code is translated to the relevant instruction steam close to the time of executing, where you can afford to optimize in a highly uarch specific way. Whereas VLIW at the time of itanium never was in that position... It just doesn't compute for me how Intel thought this was a good plan. It's not like they didn't know that existing compiled binaries are going to continue being used on newer uarchs


The critical part was less VLIW, and more EPIC - the Explicit Parallel part. There were previous VLIW arches that didn't have issues with compilers, one of them afaik even formed backbone of many advanced optimizing compilers in 1990s because the vendor licensed the compiler tech to others.


Beyond the fact that just telling people to do so is ineffective, my experience is that most people have a very poor idea of what is and isn't calorie dense (I've been there!), how many calories they consume in snacks, or how to eat in a way that leave you feeling full without gobbling down calories.

I've been around people who made legitimate good-faith efforts to diet and eat "healthy", but have no idea that "just a bowl of rice to go with it" and "I need my afternoon milk tea" and maybe another snack are like 500+ extra calories each day, that hardly even leave you full.


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