For years now I've written this thread in relative isolation. My view that the Market is a system of systems, steered as it is, by prevailing systems intent, seemed outlandish at first but feedback showed a vaguely curious appreciation for something not yet clear. After all, none of the metrics sold by the mouthpieces and trade mates surrounding me/us, comport with methods of operations being invented here.
People in general, as it relates to SI universe, have tolerated these views, and while not rushing forth to join this parade of a few, have generally "sensed" that I was onto "something".
This past Friday, I discovered a completely independent web site, with years of content, this site has been documenting the phenomena I've been discussing here, but not in the same application senses, that Free Float Trading/ Portfolio Development is attempting to do.
My intent is to get permission from the site owner to interject comments here, as Guest Host. The combination of the work done there, as intellectual foundation, and my application to present day market use, will combine to create a new path for understanding and action.
Copied below is an out take of one session, with respect to one of our documented current prevailing systems, which we've know as a primary influencer of current market behavior. This blog has in part, been documenting it, by stalking its effects, for these past years..
In the coming months, convergence could begin.....
Guest content inserted below.
Strategic Assessment, Part 17
If there is anyone on the planet today who needs to consider his personal fallibility -- and there are a lot of us out here -- it's George Soros. Reviews are sometimes clarified accounts of the books they recount, and that is the case with John Gray's reflections on Soros' new book The Age of Fallibility: The Consequences of the War on Terror (“The Moving Target”, The New York Review of Books, 5 October 2006). Gray rephrases a question posed by Soros (p. 22): “What are the flaws in human reason that make such 'far from equilibrium situations' possible?” The example given for such a situation -- when the “accepted rules of human behavior are suspended or destroyed” -- is the Nazi invasion of Hungary in 1944 which Soros experienced as a boy. This question posed by Soros is interesting on at least two counts. He appropriates a term from the chemistry and physics most associated with the work of Prigogine and applies it to socio-politico-military situations in a fashion that falsifies its meaning in the fields of its original application. He then feeds this malaprop back into itself to create a retrograde inversion over the notion of logical flaws: the resultant statement is a subtle example of the “liar's paradox” used early in his career as a financial speculator to arrive at his notion of the “reflexivity” of markets which prevents them from being cleared and obtaining equilibrium. Simply put, according to Prigogine's account, “far from equilibrium phase transitions” are normative states of physical processes whereby negative entropy (order) drawn from the embedding domain into the embedded domain allows the subsystem to escape the ironclad rule of the Second Law of Thermodynamics in such a fashion as to permit the evolution of higher forms of order necessary to the maintenance of life. Entropy (disorder, heat) generated in the embedded domain is transferred to the environment so as to allow a temporary local evolution of form not otherwise permitted by the laws of physics as explicated during the second half of the 19th century. No ultimate violation of the Second Law is involved. Prigogine received a Nobel for explicating the complex technical details of this. The “far from equilibrium” state of a system is a “critical” state. The word “critical” is a technical term in chemistry and physics, the meaning of which is explored most thoroughly in the branch of quantum mechanics devoted to the study of “collective and cooperative behaviors in material systems”. One critical variable of such behaviors is associated with the name of Madame Curie and her husband: the “Curie temperature”, the temperature, for instance, at which helix-coil transition of the DNA molecule is initiated with replication of the genetic information contained in its nucleotide pairs. The analogical generalization of this notion to the situation created by the Nazi invasion of Hungary illustrates one type of “the flaws of human reason” responsible for creation of situations like the Nazi invasion of Hungary, which was no part of any “far from equilibrium phase transition” in the original Prigogine sense of the term. Thought, explication, and the production of propaganda by means of this sort of analogical generalization was systematically perfected early in the 20th century by V. I. Lenin and his associate Willi Muenzenberg. Mao also specialized in employment of this “flaw” which has found many applications in the theory of insurgency and terrorist warfare.
But surely this has not been the conscious intent of George Soros. Hugely complex issues are involved here. There is a certain appearance of circularity in Prigogine's understanding of “far from equilibrium” processes. Entropy generation by the macrosystem maintains the internal system state which itself generates “dissipative” structures, the structures of life-forms in evolution. This fact inevitably led Prigogine into explorations of the relation between entropy generation and time. As time evolution transpires, entropy is transferred from subsystem to system to supersystem, and these being relative terms the exchange process continues on and on to larger and larger spatial scales of the universe. But the farther out into space the exchange process proceeds by time evolution, the farther back into time does the process “look” for its sustenance. Fundamental issues in Einstein's relativity theory cannot be escaped, just as issues at the core of quantum mechanics cannot be escaped in consideration of “critical” state behaviors of collective and cooperative phenomena. At the critical state -- Madame Curie's state -- the correlation length snaps to infinity: no matter how far removed in space the elements of the process become, their states remain highly correlated -- thus contravening the basic rules of Newtonian mechanics. There seem to be “flaws in human logic” involved here. And, indeed, early in the history of quantum mechanics the notion was entertained that some new type of logic was required. But this was unwelcome: back to the future, infinities, violations of classical logic that threaten the foundations of Western civilization. The very notion of an objective world was called into question, a threat that settled in upon physics as the “quantum measurement problem”. That Soros has been sincerely struggling with this problem in his own way is clearly stated in Gray's article (p. 22):
Social objects are not like stars or stones, which exist independently of how humans think about them; social objects are partly created by human perceptions and beliefs, and when these perceptions and beliefs change, social objects change with them. This introduces an element of uncertainty into our view of the world that makes us even more prone to error than Popper believed: we can never have objective knowledge of society, if only because our shifting beliefs are continuously changing it.
Reflexivity in the social life-world by virtue of our changing beliefs. Here we have another subtle “liar's paradox”. Soros has generalized Heisenberg's uncertainty principle of quantum mechanics to social experience in the middle scale levels of reality: this is a violation of the uncertainty relations formulated by Heisenberg, which require that the measurement probe be of sufficient energy to disturb the process being measured; otherwise, stars and stones -- macroscopic objects -- could not “exist independently of how humans think about them”. Sustaining objectivity of stars and stones requires maintenance of the “classical limit”, which Soros violates with his analogical generalization of a principle of quantum mechanics to sociology.
But perhaps it is even more complex than this. Why would George Soros subliminally want to retain the classical limit with regard to natural macroscopic objects, yet violate it when it comes to macroscopic social objects? And is this unique to George Soros? One must admit that the paradox involved is an neat wish-fulfillment. One can eat one's cake and have it too -- or at least one can maintain the appearance that this is so. Clearly, the answer, in the case of George Soros, goes back to the events of 1944. By then, all these issues in one form or another had been on the scene for over a hundred years, first in the higher mathematics of the 19th century and then in the new physics of the early 20th century. Is it possible that how these issues were collectively dealt with then were cognitive preconditions to origins of the world wars? And further, could it be that those issues, never having fully been put to rest, are part of the cognitive preconditions to the present global crisis?
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Look, it doesn't seem quite reasonable that I should be required to yet again re-state the same notions that are explicated in multiple ways on a general level, in technical fashion, by mathematical derivation, with regard to experimental data, and which were computer modeled and repeatedly tested as are already stated at multiple locations on this website. But if it will be helpful… Soros makes the same mistake that consensus atmospheric science makes; he indulges in the “Noam Chomsky behavior”: moral upbraiding. If you read the technical literature on severe storm genesis from the period WWII through the death of John von Neumann, you will find all too often the phrase “pathological phenomenon” used in relation to tornado genesis. You are either with us or with the hurricane! That old saw: 1T2 logic. Severe storms process complex angular momentum arriving in the Earth's upper atmosphere riding upon the solar wind. Contrary to Hawking's early take, they are information processors, i.e., part of normative natural process by “far from equilibrium phase transition”. Human beings residing on Earth need to “go with the flow”, which means, for instance, not building cities in locations required by our Sun for solar-terrestrial information exchange. If you violate requirements of the Sun Goddess, she will smote you. If you stay out of Her Way, she will nurture you. And woe be unto you if you arrogate the whole means by which Sun and Earth communicate and adjust to the levies placed upon them by Galactic Center, arrogate by disrupting ozone metabolism, by altering frequency spectra of pulse-code bursts with greenhouses gases and electron-temperature enhancements, and so on. Acoustically-modified gravity-wave modes poke holes in the tropopause boundary, allowing drawdown of ozone, not because they are pathological demons, but because that hole-poking is itself a deposition of information required for restoration of energy-momentum balance to the upper atmosphere which has just conveyed, by self-unbalancing, packets of information synthesized at the center of our Sun. Soros thinks market reflexivities are “pathological phenomena” resulting from human fallibility, that they are not “natural” by virtue of conforming to the “forms” of nature -- or more accurately, form forming, informing, and self-informing at limiting velocities of information exchange, limiting accelerations, and limiting time rates of change of acceleration. Markets are no “Platonic liquids” according to the Soros notion of reflexivity: no Platonic hyper-shapes appear in market wave dynamics because the market is human-created, and being human-created it cannot be “natural” because humans are-- what? Not properly part of nature; by implication, therefore, they are above nature. This is secular theology. And an exultation of the egoic (I thought I was God, he once said according to the newspapers) by denial that “collective and cooperative quantum processes” govern human behaviors just as they govern behaviors of any other natural process. There is no natural process you can find that does not employ some sort of “exchange unit”. That being the case, monetary units of exchange, therefore, must be an expression of the properties of “general process” in nature -- and the more monetary exchange units in their form, by their defining properties, that is, mirror properties of “exchange units” in nature the more competent they will be at executing “far from equilibrium phase transitions” by facilitating resource exchange across phase boundaries of the global economy -- particularly if those phase boundaries were arrayed according to natural form in process by disposition of the defining properties of the exchange units employed. Is it possible that what Soros sees as the results of “human fallibility” are actually the results of the defining properties of monetary exchange units employed by contemporary markets? Those defining properties of currently employed monetary exchange units came together under the guidance of the Cartesian-Newtonian paradigm by employment of the rules of classical 1T2 logic, and they have never been upgraded according to the insights provided by the quantum mechanics of collective and cooperative behaviors in material systems and the µTm Lukasiewiczian logics integral thereto. Soros has been all over this ever since he was a student at the London School of Economics, but he made his choices and his interpretations, as did Popper, under the impress of the affect-charge inculcated by experience of the events of 1944, affect-charge never adequately dissipated by the autogenic brain discharges responsible for formation of the “dissipative structures” described in Prigogine's theory of “far from equilibrium phase transitions”. In the Earth's atmosphere, one class of such “dissipative structures” is the tornado. Exchange processes cease being “far from equilibrium phase transitions” and become pathologies when formation of dissipative structures -- Platonic hyper-shapes -- is blocked by suppression of the natural processes required for adequate growth and repair. Doesn't it seem something of a Gore-ish fantasy to imagine that the human species can adequately respond to the climate-shift dynamic it has initiated without putting the economic processes it employs to allocate resources into more-natural form than were the economic processes employed to initiate the climate shift in the first place?
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