Swimming With Black\/White Swans in Shadow Markets & Wars

Awestruck by ‘AI Bubble’? In plain sight. No declaration of bust.

As nations & non-state actors declare not War. Simply attack! 

Stalin warned, “If any foreign minister begins to defend to the death a ‘peace conference’, you can be sure his government has already placed its orders for new battleships and airplanes.”

Israel, are your ears ringing?

Heed as you and the West attempt conquest of the ‘certainty’ of freedom and security by way of deception, you’ve painfully discovered it will attract more birds to swarm; only the nature of these birds are not that of doves and will bring their flock to your soil.

2026 or 1929, depression or financial crisis, like ripples of moving objects in water, effects have long been felt. Tech and government jobs slashed and prices soaring, food bank lines, homeless across the country…

Either way, it’s sink or swim!

“If we can agree that the recession wasn’t about bubbles but about the organization of knowledge, we can move on to restoring the systems that allowed the global economy to expand more in the last 60 years than in the previous 2,000.”  – Hernando de Soto, 2011

No need for Bank or Bubble run. Yet, appears Palantir is ‘setting up shop.’

Apparently the $50 Billion in 2008 was insufficient and the banks could do with a few more bits of coins. If the money game has winners and losers, then who do you think plays with the facts?

Recall the metaphor of the man who lost his keys? As he’s searching a sidewalk, a stranger asks him what he’s looking for? “I lost my keys,” the man replies. The stranger advises him to trace back his steps to where he dropped them. The man still searching replies, “Across the street.” The stranger then asks, “Why are you looking for them here and not there? “ Man replies, “Because this is where the light is.”

AI investors, searching for your ‘keys’ in the blinding light or where you lost them?

Swing of the Pendulum – Globalization to Digitization

Digitization’s disruption, accelerated by Artificial Intelligence and its Present implications can best be leveraged by preempting its Future ‘law of intended consequences’ – Automation to Artificial Intelligence.

Reassessing the Disruptor that preceded Social Media and AI is a good start ►“Globalization: A New World Order” as I noted in 2016:

“Globalization has given rise to a chain reaction where the state’s withdrawal has strengthened Transnational Corporations (TNCs) who feed the beast (globalization)…TNCs are powerful key actors in the market economy precipitating the fragmentation of the nation state and in turn facilitate globalization.

Moreover, one could assert the state’s withdrawal and transference of power to TNCs was facilitated through deregulation and privatization. Consequentially, TNCs have exacerbated economic inequality giving rise to a cultural divide, provoking nationalism and in turn creating small pockets of displaced underground worlds.”

TNCs, is it any wonder ‘AI bubble’ is interlinked. It’s two biggest tech corporations (Alphabet and Microsoft) are funded by Banks (JP Morgan, etc), AND dependent on Energy, Oil and Gas.

E-commerce is reliant on Tech as Tech on Chips and around we go.

Looks like it’s time for ‘A Swing of the Pendulum’ suggested as the ‘only hope’ by Kenichi Ohmae in “The End of the Nation State.”

According to Ohmae “good policy can slow the pace, bad policy can accelerate it. But no policy can stop it altogether.” In other words, policies are only useful if they are actually viable and backed by those who can actually implement them. Otherwise, they simply have no leg to stand on.

New monetary forms of exchange like the Euro and borderless states have a “cumulative effect of fundamental changes in the currents of economic activity around the globe” according to Ohmae.

The consequences of the current body politics of nationalism will be trumped by the Leviathan power of the market forces of globalization. I am reminded of Robinson’s observance of a 5th phenomenon, “new social hierarchies, forms of inequality and relations of domination around the world and in the global systems as a whole.”

While in the old world we spoke of empires, then the phenomenon nations appeared, which lead to international,  transnational, and now a new world, globalization.

The power shift from state authority to market authority is increasing. Where once policy was practiced within the political domain of states and nation states, in todays’ era of globalization new players have entered into the political arena -TNCs. 

Consequently, the new market forces “are now more powerful than the states…” notes Ohmae.  

In Susan Strange’s The Retreat of the State, Strange makes a compelling argument as to the declining authority of the states observing a “shift from state authority to market authority”. Strange stressed “TNCs have come to play a significant role in determining who-gets-what in the world system”.

In fact, some could argue that the order of the world continues to be remade deeming the old obsolete and that it is the end of the nation state as we know it.

Furthermore, Strange points to the retreat of the state facilitating the dissolution of the nation state through the “diffusion of power in the world economy.” In other words, states are taking a “back seat” in executing their role in government. This has allowed for capitalism to flourish throughout the globe where the markets have become a new hegemonic power shielded by the state which has a stake in the market. The state’s vested interest in the market can be seen in their economic policies which facilitate privatization, tax evasion, and deregulation.

Of course, if you’re not adverse to risk, then walk into the looking glass of the past, back in May 7, 2019:

“Being Bullish and Bearing the Risk”

“There is something about jumping a horse over a fence, something that makes you feel good. Perhaps it’s the risk, the gamble. In any event it’s a thing I need.”  –  William Faulkner

Facing Decision-Making and Economic Uncertainty

John von Neumann and Oskar Morgenstern delved into what Peter L. Bernstein notes “the individual making a choice between two combinations of events instead of between two single possibilities.” The “certainty equivalent”, derived from Daniel Bernoulli and which Bernstein notes is “the essence of risk

aversion…how far we are willing to go in making decisions that may provoke others to make decisions that will have adverse consequences for us.”

Agreed, but it is also important to consider that fear of uncertainty can render you powerless to act. Moreover, it is critical to understand the difference between stability and certainty.

Certainty eludes our world; promoting a stable economy does not. Such stability starts with a monetary system.

To be sure, the use of predictive analytics has its critics. Although it can provide useful information and assess risk, its foretelling of the future is questionable. There is an inherent risk within economic cycles whereby recessions cannot be averted.

Alas, some individuals do not make calculated risks or worse, refuse to learn, as J. Bruce notes, “Lehman CEO never did learn about risk.” To be fair, the same could be said of some economists and world leaders.

Consider “The existence of a financial crisis may indeed reflect a failure of regulation, but a failure of macroeconomists to predict the crisis need not mean that the macroeconomists have failed to do their job” according to S.D. Williamson.

I concur. Not only does deregulation continue but the mere mention of the word “REGULATION” is frowned upon.

Events of Year 2019 were a precursor of what was to come.

In April, were you “Looking for the Key to Financial Freedom in the U.S.? Stop Searching in “Shadow Markets” for Economic Facts.”

Seeing what’s transpired since the 2008 financial and economic crises, the ongoing debate of “alternative facts” is not surprising; one has only to look at American history books. In fact, the vast majority of the public grew up surrounded by the “organization of knowledge” or “alternative facts.”

A Bloomberg Businessweek 2011 paper, “The Destruction of Economic FACTS” by Hernando de Soto with Karen Weise gives an excellent account of the importance of economic facts. De Soto writes:

“The importance of economic facts may not be obvious to Americans. ‘What does the fish

 know about the water in which it swims?’ asked Albert Einstein? But it’s easy to grasp from

 the perspective of the developing and former communist countries where I live and work.

 In these countries, most of our assets and relationships are in the informal sector, outside the

 legal economy. Because they’re not recorded in public memory systems, they cannot be written

 up as facts and are, in effect, invisible.  All we have are shadow markets.” 

Power over Politicians and the Public

The Fed’s narrative of a strong U.S. economy refers to a particular set of statistics voiced as facts. But what the Fed does not acknowledge is a narrative voiced by the data that has amassed since the 2008 economic and financial crises: slowing housing market and credit card and student loan debts at a historic high. Ignoring these realities sets a dangerous precedence, whereby debt, not data, will eventually be the making of the next crisis and the topic on every ones’ lips.

The U.S. 2008 crises awakened its citizens forced to face the dark reality that their livelihood depends on corporations working in “shadow markets” facilitated by politicians blinding the public with a large spotlight, rendering them unable to see the FACTS.   

Cascading AI rush momentously downing chatty climbers & divers where Islands, not Towers is where their last grapple be. I remind you, ‘No Man is an Island.’

Century ago, the ‘crash’ pointed to utilities and banks. Is it any wonder Tech has been ‘connected’ to utilities and banks?

Appears the same power that keeps you on is the one you too can’t live or die without.