Why AI Struggles When the Market Panics

Wiki Article

Finance innovator Joseph Plazo just told a room full of Asia’s brightest something Wall Street has been avoiding for years: AI may be powerful, but it’s not wise.

MANILA — Plazo didn’t come to praise AI. He came to shake people up.

On a sweltering Thursday morning at the Asian Institute of Management in Manila, Plazo addressed a sea of students from top Asian universities—Kyoto—expecting a sermon on AI’s inevitable rise.

What they got instead? A masterclass in humility.

“AI is like your smartest intern,” Plazo smirked, “But you still don’t give the intern the keys to your vault.”

The room broke into giggles. Then they paused. Because he was dead serious.

### The Flaw in the Code: No Judgment

Let’s be clear—Plazo isn’t some technophobe clinging to the past. He designs trading AIs. His firm, Plazo Sullivan Roche Capital, runs some of the most accurate systems on global markets. He understands machine learning like few do.

But that’s exactly why his warning felt urgent.

“The problem isn’t AI,” he told the room. “It’s our wishful thinking. We keep dreaming it’ll save us from making hard decisions. It won’t.”

Plazo shared real-world case studies—moments when AI signaled winning trades… just ahead of a central bank pivot or an unexpected war. Events that didn’t fit the algorithm.

### Even The Bold Questions Got Burned

A student from Kyoto asked if LLMs might someday gauge global sentiment.

Plazo didn’t flinch.

“AI can catch a tweetstorm. But it can’t hear fear in a press conference. It misses regret in a central banker’s sigh.”

The room oohed. That one stuck.

Another asked, “Can AI ever understand conviction?”

Plazo raised an eyebrow.

“Conviction isn’t math. It’s gut. It’s shaped by failure and memory. You don’t download that.”

### A Wake-Up Call for Tomorrow’s Titans

This wasn’t about flash trading or chatbots. It was about principle.

Students admitted they saw AI as a cheat code—an escape hatch from risk, from thinking check here too hard. Plazo tore that idea down.

“You can automate your trades. You can’t automate your values.”

That line echoed. Because everyone in that room—from the copyright cowboys to the quant whizzes—wanted alpha. But not at the cost of why they started.

### So What’s AI Good For?

Plazo didn’t trash AI. He credited its strengths:

- It filters noise.
- It backtests at scale.
- It spots technical setups better than any human.

But it can’t read sarcasm. It fails to sense when a politician is bluffing. And it doesn’t know if your retirement burns.

“If your AI bot makes a bad call,” Plazo asked, “do you still own it? Or do you blame the code?”

That’s when the silence hit.

### Trading is Human—AI is Just the Tool

Plazo wasn’t preaching finance. He was preaching maturity. Use AI—but don’t worship it. Let it assist—not decide.

And yes—he still believes in the machines. He’s building tools that track geopolitics, misinformation, even psychological nuance.

But he left no doubt:

“No machine can tell you when *not* to act. That’s your job.”

### In a World of Signals, Be the Noise You Trust

As the crowd filed out—buzzing, challenged, changed—one phrase echoed down the halls:

“AI doesn’t know your values. So don’t let it make your decisions.”

In a world chasing speed, Plazo offered something rarer:

A mirror.

Because investing isn’t just about *winning*. It’s about knowing **why** you played.