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Cours Or & Argent

Black Swans and White Noise

IMG Auteur
Publié le 05 janvier 2015
425 mots - Temps de lecture : 1 - 1 minutes
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Rubrique : Or et Argent

The introduction of noise into a system can amplify the movement or efficiency of that system.  Sometimes a little agitation helps to broaden a signal; this phenomenon of stochastic resonance has helped in understanding many nonlinear and complex systems - from medicine to diet.

The current financial system is a poster child for the non linear. Many nodes, endless connections. No way to parse all of the nodes and the connections. It hums along, based on confidence and dependent on an artificial type of intervention.

A system held together by fraying strands, a woeful lack of redundancy in the form of payments systems and credit flow mechanisms. And then noise is introduced. An event. A surprise. Or a new direction.

It may not be detectable. Eventually, it amplifies the direction…

To the point where part breaks.

The agitation can come from many things. From ‘known knowns’, like subprime or student loan defaults - to the unimaginable or trivial, like some upper air disturbance or a media driven accident that turns violent.

And the system spirals out of control. It collapses. Nature abhors a vacuum.  Commentary abhors the truth. We all want to believe that this time will be different. We want to believe that the same forces of equilibrium exist in the products of civilization.

There are physical laws but human behavior does not correspond well to those laws.  Behavior is irrational and unpredictable and capable of moving fast.

There are trends and propaganda. But they don't. Civilizations are not held consistent to any deep law or set of principles. Civilization is a product, a fluctuating pattern long disconnected from the physical processes that give rise to organisms - biological systems.

You may be able to hide the connections — but they are not some mysterious force. Or they work in a realm with its own set of laws. Failure and breakdown feed back directly to the physical environment…the lives of real people.

The closer you get to this reality, the more complex, and the more people want to run away from it. It’s far easier to worship the price and fantasize about its meaning. The fantasy fuels the modern professional trade complex where would-be physicists, mathematicians, and engineers are lured by the pied piper.

We either bribe our brightest into years of debt servitude or we bombard the brightest with visions of affluence, wealth, societies, and cultural - popular ideas.

Who can blame them? The music lures them into the poverty. In essence, they give up their souls.

Stuck in a poverty of affluence.

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