Men Who Nurture Beasts

Shannon’s Daemons

When the haruspicy-entrails of “The Chart” quotes a given price to the customer, the price quoted is a difference, between the highest bid and lowest ask - the center of the spread. It’s these two sides of the asset’s attention-economy that fuel the asset’s movement - their give and pull in seeking equilibrium around an elusive perfect mid-price.

In models of these markets, the assumption is always that the mid price is a random walk, at least in the short term. However this is truer for space, rather than time. A large movement always has a good-enough web of causes to weave around it and explain the millions of accumulated behaviors behind every bid and ask, whether that was a violent spike upwards or a slow directional drift over time. From this, we have the secrets of investors trading on large spatial movements - whether value investors waiting for the mid price to catch up to a more accurate number or the insiders who short-sold 9/11. Against them, is the class of daytraders attempting to determine the weather via cloud watching, seeing the market’s entrails splayed out to draw patterns into and predict short term chaos on which to gamble. For the few who are successful, the impossible game is won by blunt simplicity, rules so vague as to operate on something much deeper than the auspices of candlestick divination. Rumors abound of a japanese day trader, who quietly said - “I watch the order book, selling as it goes down, buying as it goes up”.

Claude Shannon wrote of a theoretical demon - an idea he never fully pursued, but constructed an interesting thought experiment around. Imagining an asset whose price has random motion with no overall direction, a portfolio - the demon - could be constructed which harvests this volatility for its own ends by consistent rebalancing. It bears resemblance to the concept of a Feynman-Smoluchowski Engine - a gear with a ratchet turned by a paddle set against a chaotic mass of particles. As the ratchet exists to either halt or allow movement of the axle based on the direction the paddle is turned, the result is that, in theory, the paddle is powered in a single direction neutral to the direction of the underlying. Shannon portfolio was, from this concept, a demon which invests without memory on the simple rule of keeping a consistent balance between cash and the asset - 50/50. In theory, this would trade on day-to-day movement despite the underlying’s neutral or even negative drift, trading and profiting off the noise of drift, rather than any large predictions of direction- in essence, the perfect daytrader.

I refer to this as noise for two reasons - firstly, because its nature is that of noise, an infinite amount of inputs go into influencing the behaviors of every transaction on a given asset, determining the micromovements of the bid/ask spread. Secondly, because like a layered composition, it exists in layers of soundwaves that, like soundwaves, expand in the spatial dimension based on their depth. The highest, most minute fluctuations of the book of minimal spatial importance exist in layered relation to the lowest, most tectonic drifting of the book. The upper register of the same spectrum is the inter-band nonsense of a wider frequency, and on and on.

This, the lower and wider spatial dimensions of the market’s music, is what we speak of when we speak of causes in finance. The market’s problem is that of the famous Coastline Paradox, the fractal breakdown of a noisy line as spatial dimension shrinks. The layers of this noise are layers of sonic development, an insight which founds the discipline of political-economy - an attempt to construct a pyramidal image from fractal noise. We can investigate this easily in Marx. Working in both directions, the Soprano peak of workers toiling in his time and place, to the Bass tectonics of the long arc of economic history and technological development, Marx constructs a complete image, a complete story of the entire market, at all spatial levels.

National Terroir

Stoneworks in the heart of wealth, gushing water in imitation of a natural spring. Kircher wrote of a mechanism where the Earth’s water circulates beneath the Earth in immense underground passages, draining through the Norwegian Maelstrom and bubbling up through the mountaintop springs at the source of a watershed. In every city, is a network of tunnels imitating this - the underground flows of immense energy, harnessed and tapped. The fountain imitates a spring, water rising up from stone, as the deep well has its volume thrust upwards in a sparkling show of its power. The urban or palatial fountain is here, symbolic of the essence of power - the twinkling emergence from tectonic depths. The deepest thrum of power beneath the world, deeper and on more tectonic timescales than any nation even is tapped into, sublimated upwards, harnessed and celebrated towards the power structure in front of it. One passes the fountain to enter the front gate, seeing before them a symbol of how whatever the grand building got there - chthonic depths of power rising upwards brilliant and newborn, turned by human magic from subterranean leviathan to blooming glory, each twinkle of the water, the twinkling soprano notes of the chaos of day to day life - all built on firstly, the chthonic power humming at the lowest depths, and secondly, on the magician who pierced the Earth with pipework and forced the water upwards and into the higher, more immediate pipes and channels of the estate.

Power is built through these rituals, on a foundation of a technique of tapping the Earth’s undercurrents and transmuting them upwards. Of every pyramid, the base is developed upon by some form of transmutation, where a process in motion is taken up and forced into a new form that powers the structure above it. This transmutation is always a form of sodomy, a perversion of the beneath - in the same way that reproduction is perverted from the long arc of animal genealogy into aristocratic decadence. Thus emerges the pyramid of the economy - levels of upwards motion to the most minute levels occurs through a continual ladder of sodomy, where a machine transmutes the deeper vibrations into higher vibrations.

Eyes Wide Shut is the comedic tale of an American encountering the sins of the pre-petroleum world. Before technology enabled new forms of sodomy, every civilization had one identical sin to its name - sodomizing the human spirit. Young beautiful women (in the language of cinema, the pinnacle of humanity) are brought before the masked partygoers, made to strip as the red-cloaked hierophant taps his wand to an inverted mass and synthesized strings. The ritual takes place in a palace, the kind of which isn’t built by the fragile pile of cash the protagonist’s doctoring grants. These women are used by the men masked in various guises, commedia dell’arte distortions of the world, from the moon to the street merchant to the cosmos. The human being, with a certain quantity of vitality inherent to it, is entrapped in the feudal world, a world of relations yoking it to the plow. The changing of the seasons, the fertility of the soil, the whims of the landowner, the demands of ongoing wars, the onset of disease. The peasantry are as the nude women of the masked ball, raw spirit sodomized to bubble upwards as the bedrock of the feudal economy.

In speaking of this sin, most empires are named as such for their innovation of seeking grain-labor beyond the homeland - as in Rome or Babylon. Rather than be content to their own parcel, or be locked into that parcel by geography, they would construct new peasantries beyond their own borders. The innovative sin of Rome, beyond the basic one of human domestication, was active domestication, the constant pursuit of expanding the size of its grain-slave apparatuses by yoking new peoples to its systems.

Technology however discovered two new forms of energy. In all cases, what makes various forms of sodomy exist is that they are the means by which a society gets is power, the energy, the blood through its veins. In the 19th and 20th centuries, two new forms of sodomy were discovered beyond that of human labor - nuclear energy and fossil fuels.

When the reactor explodes in HBO’s Chernobyl, scenes in both the first reactions and post-mortem recreations of the camera looking into the hellish below. In a wound in the fabric of reality, we see reflected the sins of the Soviet Union. Nuclear energy was known by David Lynch to not merely be dangerous, but an act of spiritual evil in itself. In the infamous episode eight of The Return, reality is torn apart at its most fundamental level. The Trinity Test was an act of overt blasphemy, tearing reality at its most foundational seams in a ritual of corruption. From this act of destruction we encounter nuclear energy. The violence is then instrumentalized as a ritual, the explosive energy released in the tearing of the energy of atomic bonds put to work in either war or economics. When the characters of Chernobyl look into the burning core, what they see is that wound in the world, that black mark of sodomy, the place where mankind grasped firmly onto the fabric of things and twisted it, sodomized it, prostituted its destruction in a ritual of metaphysical corruption. It was through this that the Soviet Union collapsed. Unable to cope with their sin, they denied it until they couldn’t any longer, then they desperately tried to save themselves against the hellish heart of the reactor. The wound of the reactor continued to bleed until the entire nation collapsed, exsanguinated by the ultimate result of its scientific religion.

Seeping up through recesses of the industrial world as well, is that of another form of sodomy - necrophilia. For the United States, work of killing at the tip of the imperial spear was never conquest, but a cold sense of extermination. While the traditional empires, Roman, Zulu, Chinese, Mongolian, Persian, Mughal (and on and on) sought to subjugate their conquests, to make them tributing slaves (a logic held even by the supposedly advanced empires of industrial Europe), America sought to exterminate its conquests. The policy towards the natives of the continent was not that of a foreign people to be dominated, but a biomass to render into a more palatable form. The obsession then, of “indian burial grounds”. In The Shining, Jack finds himself possessed by this violence of this speartip, the ghosts of the past coming into him through the remains left behind of the exterminated natives. Notably, it’s not the natives themselves that possess him, but the violence which they exist in relation to - annihilation so complete that all that remains is the raw impact of annihilation, the verb, to which all nouns are meaningless except in relation to itself (hence Jack’s sudden racism). Jack is not a ghost. Jack is wounding, the poison left by the blade buried deep in scarred-over wounds bubbling to the surface to strike against those who once thought him hidden.

This, is the sin of petroleum. Black gold is identical in character to America’s land, the biomass treated as nothing but fuel. Life sunk to the Earth’s depths as a great ocean of death, the planet’s living-history, now sodomized upwards to be the fuel underlying great civilizations.

Solved here is the fundamental mystery of civilization. Entropy all but guarantees that civilization should be impossible - how do we seemingly result with more than we started? The answer is that we do not, but rather, that civilization is nothing but a passing phase in the lives of something deeper, a product of tapping that something deeper and harnessing it upwards.

Builders of the Temple

The seals of King Solomon were not, as commonly imagined, invoked as signs, but rather placed upon the demons, like shackles. The demon was renamed and disciplined. Solomon is more than anything, the first Foucauldian, a king who understands the nature of power as being inextricably linked to the discursive apparatus which undergirds that power - the ritual through which it performs its fundamental sodomy. The “true name” of a demon, its seal, is a set of linguistic shackles, the discourse around which the demon has its being fixed into a new form, one of labor. The demon’s being is remade as a mere symbol inside the language of Solomon’s divine economy, one which only has capacities within Solomon’s understanding - enslaving its being towards Solomon’s ends.

Foucault wrote of this, regarding the creation of new beings from previously unformed clay. For the owner of the workhouse, the human being is remade as a demon, a new being entrapped by the solomonic seals of the proletariat. This act of transmutation was one of the fundamental actions of hierarchical order, the ability to take the undifferentiated mass and recreate it into forms fitting within the orders created by the superior - in other words, constructing the fountain which sodomizes the groundwater. Hence the “taming” of Enkidu, the usage of language to form the wild man into the civilized, enslaved man at the beginning of it all.

Enkidu is a vital example not simply as the first domestication, but as the domesticated that becomes the speartip of creating-order. The hawk and hound enabled the hunting instinct to develop. Prey animals and wild grasses were domesticated with the newly found tools of control and from them, these techniques became powerful enough to turn on the lesser humans who never developed the same weaponry.

The perfect spear, as the symbol of the king. Turned outwards against barbarians, against the chaos of the world - the ritual of sodomy where the world is taken up as raw material for greater ends. It’s said that the spear which wounded Christ has these properties, the perfect weapon instituting Heaven on Earth, as God was made flesh, so can a christian kingdom be made from the mass of the world. Every ruler dreams of this weapon, of this perfect ritual which eternally sustains.

It’s for this reason that while the peasantry engages in labor, kings partake in hunting - a vivid symbol of what they do, in yoking the peasantry to their machines and fields. The beast is slain, the mute wild man is lashed to the land. Blood spurts upwards through the fountain, the end-stage flow rent from the base stone.

Always From Within

History is a continuous march, of silk slippers descending and mailed boots ascending. We all know the example of the need for bush fires to prevent inevitable crown fires, but the symbolism here is specifically important - fire comes from outside, the sky striking lightning down upon the forest, which creates the condition for a small revolution from beyond the stable order. That order is stable for the reason of its self-domestication - every civilization has this point after the peak, where it first becomes completely domesticated and secure within itself, and then suddenly becomes vulnerable. Grasses growing solidly are grasses ripe for grazing. This is the creation of the “concrete jungle” - the civilization built and ready to decay, the city as a biome, a natural environment - prey.

The continuous cycles of revolutions is a continuous renewal of fire, a reforging in new hands of the spear of the king. That blade dulls and descends as it settles down, before it returns from beyond. No one party owns the spear, rather its heritage (the Mandate of Heaven) is simply passed from the center to the outside, until that outside forms a new center to repeat the process.

Thus the paradox of royal order - the very engine of a nations’s rise is also the engine of its fall. For the same orders which brought the nation into being, the words in air inscribed by the speartip, that engine of domestication, leads the nation into a state of weakness, their very success as a predator forms them into prey.

We see in every nation, its decline creating its fall. Rome overexpanded itself, running thin, and eventually its grain-economy collapsed under its own weight. Barbarians swarmed across its continent-spanning carcass and picked its excesses clean, a skeleton clothed in fine silk. In the Soviet Union, it was Chernobyl, the great refutation of all their pretending towards control. In a nation obsessed with order, that the very chaos they hoped to domesticate would spring upwards and burn them from within was a greater coup than any Gladio cell could dream of.

Civilizations ebb and flow on the virtue of their technologies of extraction, a series of springs sprouting up across the landscape. Take note of the course a nation takes, as the course of a spring’s flowing. The water itself originating from a single source, that tapping of some subterranean flow pushed upwards, the descending. The course it takes is entirely dependent on what its allowed to do, by both the circumstances of its origin and the course which it’s destined to take.

The spear of the king changes hands to the barbarians, as the subterranean currents give and take at their own tectonic drift. The depths of the chthonic world dry up locally, deserting the king, leaving a spear with no beasts, a hunting party starving in the desert. The king falls dead, a skeleton in the wilderness, as a new king is born in a distant land. The nation flows down the mountain from this spring, its being eroded into the landscape, gouging history until the spring runs dry and leaves only a valley in its place.

Bibliography

Personal experience watching equity & derivative market order books

TrueAnon 9/11 series

Rumors I heard when discussing daytrading, I don’t remember when or where

Fortune’s Formula, William Poundstone

Asymmetry and Disorder: A Decade of Parrondo's Paradox, Derek Abbott

Diversification Returns Rebalancing Returns and Volatility Pumping, Cuthbertson Motson Hayley Nitzsche

Capital, Karl Marx

Intently watching several fountains

Athanasius Underground, John Glassie

Eyes Wide Shut, Stanley Kubrick

The German Ideology, Karl Marx

Chernobyl, HBO

Twin Peaks The Return, David Lynch

The Shining, Stanley Kubrick

The Lesser Key of Solomon

Discipline and Punish, Michel Foucault

The Epic of Gilgamesh

The label on a bottle of Jägermeister

An old proverb

Forest fires (excluding human variables)

In Ruins, Christopher Woodward