Monday, June 19, 2017

The Fall of the Western Empire: Collapse is Not a Bug, It is a Feature

Esset aliquod inbecillitatis nostrae solacium rerumque nostrarum si tam tarde perirent cuncta quam fiunt: nunc incrementa lente exeunt, festinatur in damnum.”  Lucius Anneaus Seneca (4 BCE-65 CE)


In my book "The Seneca Effect", the first chapter is titled "Collapse is not a bug, it is a feature". The idea is that the evolution of complex systems is discontinuous, it goes on oscillating and collapsing. It is part of the way the universe works and if there were no collapses, nothing would ever change. It is a rule that applies to political systems and it is described with stark clarity by Alastair Crooke, as reported by Raoul Ilargi in "The Automatic Earth" in a post titled "Coming Apart: The Imperial City At The Brink." Here is an excerpt


Alastair Crooke: David Stockman routinely refers to President Trump as the ‘Great Disrupter’. But this is not a bad quality, he insists. Rather, it is a necessary one: Stockman argues (my paraphrasing) that Trump represents the outside force, the externality, that tips a ‘world system’ over the brink: It has to tip over the brink, because systems become too ossified, too far out on their ‘branch’ to be able to reform themselves. It does not really matter so much, whether the agency of this tipping process (President Trump in this instance), fully comprehends his pivotal role, or plays it out in an intelligent and subtle way, or in a heavy-handed, and unsubtle manner. Either serve the purpose. And that purpose is to disrupt.
Why should disruption be somehow a ‘quality’? It is because, during a period when ‘a system’ is coming apart, (history tells us), one can reach a point at which there is no possibility of revival within the old, but still prevailing, system. An externality of some sort – maybe war, or some other calamity or a Trump – is necessary to tip the congealed system ‘over’: thus, the external intrusion can be the catalyst for (often traumatic) transformational change.
Stockman puts it starkly: “the single most important thing to know about the present risk environment [he is pointing here to both the political risk as well as financial risk environment], is that it is extreme, and unprecedented. In essence, the ruling elites and their mainstream media megaphones have arrogantly decided that the 2016 [US Presidential] election was a correctible error”.
But complacency simply is endemic: “The utter fragility of the latest and greatest Fed bubble could not be better proxied than in this astounding fact. To wit, during the last 5,000 trading days (20 years), the VIX (a measure of market volatility) has closed below 10 on just 11 occasions. And 7 of those have been during the last month! … That’s complacency begging to be monkey-hammered”, Stockman says. 


Read the whole article: Coming Apart: The Imperial City At The Brink

2 comments:

  1. Some thoughts;
    1: previously: destroying could be followed by reconstruction on a grander scale.
    2. Recently: destroying is often not followed by reconstruction and even if it is, it is diminished.
    3. Near future: once destroyed, very unlikely to be rebuilt
    Implication: Look after assets very zealously, they will need to be maintained and cossetted for a very long time.
    4. 'Collapse is not a bug but a feature' can be taken too lightly because the history of collapses in an environment which was still practically unbounded in many dimensions cannot convey the potential for totally catastrophic inversion of everything as we closely approach a far more densely bounded state.
    5. I see 'disrupter' as a very kind description of Trump. Pointless destroyer of social cohesion with widespread and accelerating physical destruction the likely result is how I see him.
    6. Americans appear to be doubling down on the Trump direction..dumb and dumber ( I can't get away from that interpretation I'm afraid -implications for democracy notwith
    standing and recognising Mercer's ruthless megadata manipulation)

    ReplyDelete
  2. Oh! Volatility is down recently ... isn't that a bad sign in a system, when autocorrelation goes up, it's a sign of an impending big shift? Or do I have it the wrong way around?

    ReplyDelete

Who

Ugo Bardi is a member of the Club of Rome and the author of "Extracted: how the quest for mineral resources is plundering the Planet" (Chelsea Green 2014). His most recent book is "The Seneca Effect" to be published by Springer in mid 2017