LUDIC ECONOMIES

DERIVATIVES -- IMAGES - GHARAR

You need only to conceive something as AN IMAGE in order to trade in it. There need be nothing behind it -- structurally speaking.

A fantasy baseball league of players yet to be born.

The islamic ban on any kind of futurism. "you cannot sell the fish in the sea..."

LOTTERY or LUDIC ECONOMIES -- HEDGES

Hedge Funds make suckers take the risks for the Casino. Nobody beats the house.

"Postmodern financial instruments, like CDSs (credit default swaps) and CDOs (collateralised debt obligations) (OR the EURO rescue vehicle) are in effect money-laundering schemes, obscuring debts by scrambling and recombining them, and selling them off in tranches so as to wipe them off corporate balance sheets. More generally, financial derivatives are "functionally indifferent" (LiPuma and Lee 2004, 44): they can be used to price, and thereby to stand in for, the risk implicit in any situation whatsoever. This indifference, or infinite substitutability, means that the underlying situations themselves need not have anything in common -- aside from the fact that they have all been arbitrarily priced. Things don't need to harmonise, or to fit together. In the world of finance capital, there is no unity or pre-established harmony..."

THIS HIDING OR OBSCURING OF ECONOMIC REALITY, we could also call it Money Art --  is a necessary evil, a positive self-delusion in a world with too much information, whose utter concreteness in its absolute density makes it abstract, unrepresentable in practice.

HAYEK's wise wisdom of the market overthrown:   

"...the knowledge of the circumstances of which we must make use never exists in concentrated or integrated form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess. "

                                                                                      -- F.A. Hayek

This is often overlooked: Capitalism requires delusion. People must be deluded, ideally be self-deluded to participate in the ever widening market.  Lottery as model. How do you keep people playing in a casino market? Just PROCESS, people-serfs absorbing ever-increasing amounts of risk and debt, as long as that pays out in some flashy, ostentatious way every so often, ideally with flashing lights and a-dinging.

Machine Structures such as the internet can both broadcast and harvest information for/from a vast array of human activity. Such command and control, when the data is mined instant to instant, can provide a huge, unsurmountable advantage to Capital.

BUT what happens when the market grows too incoherently wise and too fluid in its imagemaking...?

"1973 also saw the publication of the Black-Scholes option-pricing formula. Two University of Chicago professors, Fischer Black and Myron Scholes, sought secure foundations for an obscure financial instrument known as a "European call option" – a contract granting the right to buy shares of a stock for a guaranteed price at a future date. Their strategy was to assemble a fictional portfolio of stocks and options, and develop a technique of "dynamic hedging" to continually buy and sell shares, balancing out the fluctuations in price among the separate elements of the portfolio. The price of the option would be equal to the cost of continually hedging against possible changes in the value of the underlying stock. Using equations derived from the physics of Brownian motion, they created a mathematical proof and a theoretically risk-free trading technique that used a carefully weighted constellation of values to distribute randomly occurring fluctuations back into the statistically regular equilibrium of the market as a whole."