1. Of course, I'm kidding, right? Market prices are not quantum events, and no way can we conceive of the general structure of laws and finance (that is, anthropogenic rules, regulations and codes plus the world of financial trading) as one redoubtable quantum event? But I say unto you, "Why not?"
2. My argument is simply that there is no absolute boundary between the micro and macro for quantum events, and that information at its core is physical. But note, I mean quantum physical. What does this mean?
3. Take for example the Quantum Mind Hypothesis proposed many times since Shrodinger came out with his lovely wave equation. The quantum physicality of entirely everything "in" the universe forces us to conceive of the universe as a kind of "hologram" where the "real" information so to speak is condensed on the surface of the edge. What the purported individual mind becomes under this view is no less than an n-mind which is surrounded by every possible configuration of information from the surface edge of the universe. Buddha would have loved this sense of individual-to-cosmic entanglement, which he called "dependent co-origination.". The Platonic demiurge, Aristotle's soul, Plotinus' One Intelligence all can be accommodated within the quantum mind hypothesis. And its simplest natural implementation is through the language of category theory.
4. So how does [3] above relate to the current states of the markets? As we have stated previously, the invariance in the global financial markets is default. Any genuine understanding of the markets, its essential information asymmetry, come from recognising the face of default in every potential action of the market. The procedure is to take a Dedekind "cut" and to see the three sorts of infinity at the boundary between pre- and post-default. The Holy Trinity of Infinities from well-behaved and wildly-behaved series sequences are:
[C] Convergent
[DD] Definitely Divergent
[ID] Indefinitely Divergent
Or as one might fondly quip,
The Good
The Bad
The Ugly
To the good convergent infinities we can give simple names with certainty against a specific boundary. The bad definitely divergent infinities are extremely numerous and are bothersome because they may have finite inputs for their identity but they do not necessarily resolve into a single address except in the negative sense that we know that they cannot be pinned down against a boundary. And then there are the ugly monsters of the indefinitely divergent who continuously lie, cheat and steal and absolutely refuse to be confined within well-defined boundaries.
4. To begin to understand the Invariance of default, we first identify and correlate the events pre-default and post-default, categorising the events according to the good, bad and the ugly. Obviously, very few defaults have convergent infinities. And as the event you examine moves from the good, bad and the ugly, information asymmetry builds up towards a complete break, where the incremental cost for insuring against default is greater than the actual expected costs of default. How do we know? We know because it becomes infinitely obvious which parts we don't know compared to the parts that we do know! Most of the so-called "calculations" are simply going on just below the surface, so to speak, but really, much nore precisely and literally, the calculations at the level of quantum entanglement are simply physical and are going on whether we perform the calculations with paper and pen, computer, or by walking and talking, or not. The hardest thing to make explicit is the obvious.
5. As a fun exercise, you might wish to make some doodles isomorphically translating [4] above into category theory maps. You might be surprised to see how risk analysis changes from a single graph to a bi-valued representation. Hint and clue: map [B][B] in terms of the three types of infinities. How many permutations? That is the number of states of the system which government controlled markets can revolve in that particular phase of the Great Cycles of Default.
No comments:
Post a Comment
Note: only a member of this blog may post a comment.