That book made me realize that scientific revolutions and financial revolutions go on at the same time. This is because when a new mathematical framework is discovered, scientists use it to reveal nature (which improves labor), and finance uses it to reveal human nature. (which improves influence) Therefore, TWO bubbles exist in parallel:
- The assumption that future labor will be better organized (through science)
- The assumption that better organization will yield greater influence (through finance)
Those bubbles eventually drift, but they can re-synchronize, and right now, finance has outpaced science. Considerably. Smart money is keeping liquidity on the sidelines and awaiting a resynching event: Either finance tones it down or science invents new math.
Here's a gem from the book:
"After the war, the same crisis of confidence came as after the last one, the same blame game started, the same things happened. As usual, we relabeled our own past. Once again we found ways to blame it on someone, and therefore disown it as an event. It was ‘long ago.’ We’re different today though, aren’t we? Such things could never happen again, or so we tell ourselves. On the other hand, the above forecast of 2040 can’t possibly be right. No public forecast can be. Even were it to have proved accurate, had it been kept secret, once published its existence would change our future. Most of us would ignore it, as we ignore most things. But if it strikes a nerve, some of us might work hard to bring it about. Others of us might work equally hard to stop it from happening. Whoever wins, the resulting future won’t be the same as the forecast had stated it would be. No forecast can predict its own effect. It can’t predict how many of us will either fight it or push it, nor how many of us will try to predict how many of us will fight or push and try to profit from that, nor how many of us will try to predict how many of us will try to profit, and thus profit from that. Pattern recognition leads to pattern exploitation. Thus, a public forecast can come true only if none of us cares about it. In other words, our only useful predictions are our predictably useless ones. Call it Gödel’s Inanity Theorem."
Chuckles - Gödel's Inanity Theorem sounds suspiciously like the game of "Cheat the Prophet" from G. K. Chesterton's The Napoleon of Notting Hill [1]:
> The human race, to which so many of my readers belong, has been playing at children's games from the beginning ... The players listen very carefully and respectfully to all that the clever men have to say about what is to happen in the next generation. The players then wait until all the clever men are dead, and bury them nicely. They then go and do something else. That is all. For a race of simple tastes, however, it is great fun.
