The Market

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In this dossier's engagement with the intersection of the built and mediated environment, we interpret Marshall McLuhan's argument that the remediation process whereby one medium survives as the content of another is the preservation of a distinct function in the midst of informatic and material transformation. This is not to suggest any predetermined trajectory of cultural obsolescence whereby a pre-existing function is stripped of cultural obstacles in its way, but rather to note that, in hindsight, content's transformative mechanism of appropriation enables us to examine behavioral systems, and the environment that housed them, as dead media, and that such dead media provide insights into a story of the concentration and distillation of culture into the symbolic content of later media which house cultural remains.

Within the larger discussion of critical techniques this Archive attempts to employ, this dossier might also best be understood as an attempt to bridge our understanding of the isolation of medium from message (in the Hermes model) with our understanding of the communicative properties of materials which exhibit no such fragmentation (in the Iris model), as well as the rhizomatic, independent, message function that, in its ubiquitous employabilty, conforms to no specific medium (the Furies model). Far from suggesting an evolutionary hierarchy towards the immaterial, the market may, however, provide deeper insights into our understanding of the remediating processes at work in each of the three.

We trace the process whereby the concentration of trading behavior and its eventual standardization was enabled by its enclosure in the space of the market, and the processes whereby this concentration separated market activity from a distinct built environment, isolating a function which is non-physical and anticipates the remediation of the market in the scripting content of immaterial spaces. Although we make no attempt to argue that physical market sites no longer exist, we do attempt to expose the informatic and material shifts that have obsolesced such physical environments, rendering the built environments that remain stages which serve a social function that is, in itself, a commodity. We identify the legacy of this fragmentation in the built environment and in the spaces which now bear witness to the market function in unexpected forms, yet we hope that future contributions will enrich and complicate the conceptual and mediatic transformations that accompanied the resurrection of symbolism in architecture.

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What was once a spatial locality with a distinct form and use is now pure function with no distinct materiality
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The History of Exchange

The Market in Capitalism

What is a market?

Is there such thing as a "pre-capitalist" market? To posit a pre-“anything” is to argue an implicit periodization of a concept. And undoubtedly, to suggest that there was a mode of representation or media such as “the market” so entrenched within the cultural values and practices of capitalism that preceded it, would also then require some explaining. Thankfully, in this task, we follow historian Fernand Braudel, who has undertaken massive volumes of study in this area. The trajectory of Braudel’s project, in line with his Annales colleagues more generally, is to provide a historiography of capitalism does not reify the very object of analysis—the ever-expanding, seemingly amoebic process called capitalism, which Marx himself referred to as comparable to “queer things abounding.” The danger would be to overlook how the market embodies the shifting historic-economic transition from merchant to industrial to finance capitalism.

With respect to Marx and the present study at hand, it could be argued that Marx dealt the strongest blow the concept of the market as a fixed, spatial location of exchange; so why even proceed? Well, indeed, “the market” as a spatial category very much plays a large part in various spheres of life, most pressingly the cultural, social and political. Moreover, many scholars, Frederic Jameson most famously, have even suggested that the economic has fallen to the level of culture (See Jameson). In such arguments, there is an assumed de-differentiation of previously separate spheres. The guiding question in this section will be (roughly): How did the market become differentiated in the first place?

Braudel's Typology

1.All of types of exchange that go beyond self-sufficiency, of all the wheels of trade, large and small, all the categories relating to trading areas (urban market, national market) or to a given product (the market in sugar, precious metals, spices etc.). In this sense the word is the equivalent of exchange, circulation and distribution.

2.Large broad form of exchange, also known as market economy.

The Market as Interface of Digital and Analog

Braudel makes a distinction between “material life” and “economic life,” suggesting that the market, stalls and shops form a discontinuous contact surface between the two. By “material life” he means the most elementary, autarkic societies and by “economic life” he means commerce, currencies, and exchanges (Braudel, 21). Hence, the market is a medium in the sense that it translates the “non-economy, imprisoned within self-sufficiency” to the level of “exchange-“or “market-value.” The discontinuity, for Braudel, is clearly rooted his positing some sort of non-economy that precedes full-blown capitalism. In other words, Braudel envisions precapitalist market as being discontinuous and spontaneous whereas the “true capitalist” market becomes continuous and permanently reified as “the market.” Is this distinction between discontinuity and continuity also that of digital and analog? Here, it can be argued that Braudel’s point is a bit nostalgic. That is to say, that Braudel’s overarching project to delink what he calls “economic life” from capitalism, which he sometimes refers to as “true capitalism”(Wallerstein, 354) necessitates a level of fixity in what he calls a market (as opposed to anti-market). Immanuel Wallerstein helps us understand this part of Braudel very clearly. According to Wallerstein, economic life moves out of the unconscious routine of the daily life towards a more conscious and active process of the division of labor (Wallerstein, 355). Framed within admittedly fraught distinction between continuous/discontinuous, we can suggest that for Braudel the material life is analog; hence unconscious, though nevertheless full of regularities. Economic life, that is “true capitalist” life, is too then perceivably analog as it is an instrumental, goal-oriented activity of production bounded in the smoothness of consciousness. But indeed, the market is that which interfaces and mediates the economic life into material life. In addition, Wallerstein suggests that Braudel sees that market economy as transparent, whereas material life (below) and economic life (above) are shadowy and opaque, in contrast. However, the zone above, on the other hand, (the economy) the zone of capitalism, was opaque, in this case because capitalists wanted it so. It was a zone in which “certain groups of privileged actors were engaged in circuits and calculations that ordinary people knew nothing of” (Braudel as quoted in Wallerstein, 355). Thus, in this mediation, there is a “blackboxing” of the guts of exchange. The market economy (or the antimarket) does not show the immanent negotiation of the market transaction, and indeed the fixing of the market-price. Price control, which Susan Buck-Morss rightly notes becomes the representational bottom-line of the market (Buck-Morss, 463).

(The specific definition of the market is rendered even in the layout of the three volumes of Braudel’s Civilization and Capitalism, 15th-18th Century.) Against Polanyi, he argues that “the market” as a vital component of the “market economy” is a consolidation, rationalization and even remediation of practices or instruments of exchange, which existed centuries prior to the 15th century, when we see the emergence of the ordinary market (e.g., the farmer’s market). The farmer’s market is characterized by what Braudel labels “immediate exchange,” describing it as such: “goods are sold on the spot, the purchases are taken and paid for there and then. Credit is hardly used…”(Ibid., 29). Immediate exchange had been practiced centuries or millennia before in ancient Greece, classical China, the Americas (Aztecs) and all over Africa.

Industrialization/Urbanization and the Marketization of Exchange

In the 15th century, markets were held twice a week in towns and urban centers in theory only. Especially in cities such as Paris, markets were held daily. The twice-a-week rule was not so much an effect of regulation but of necessity, as the surrounding countryside needed time to supply them. During the 17th century, the shift from being held in between town and countryside to being held at the heart of towns, usually in the town squares. As towns continued to grow in size, so did the markets, to the point where the tiny town squares could no longer accommodate the number of vendors coming to sell their goods. Here are Braudel’s words: “And since they [markets] represented modernity on the march, their growth allowed no obstacle to bar their way: they could with impunity impose on their surroundings their congestion, their rubbish and their obstinate gatherings of people” (Braudel, 31). The solution adopted was that of banishing them to the outskirts of town. However, as a reaction against this measure, markets would appear as open spaces would open up, especially seasonally with the freezing over of rivers, on which goods could be brought back and forth via sled. Braudel recounts two such examples—Moscow’s Moscova river and London’s Thames. The latter is most famously represented in the adjoining engraving.

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Fair on Thames 1683. Literally bad weather

Enclosing and Encoding the Market

Markets existed in very ancient times within a single village or group of villages—the market being a sort of itinerant village, as the fair was a sort of traveling town. But the decisive step in this long history was taken when the town appropriated these little markets. It absorbed them and inflated them to its own dimensions, in return having to accept the demands they made on it.

The urban markets may have been invented by the Phoenicians. The Greek city-states had a market on the agora. The proliferation of markets beyond the town squares elicited a response by towns to take regulatory measures, the most significant of which was the construction of covered markets (halls or halles), at times surrounded by open-air markets (Braudel, 33). In the 16th century, the towns and cities of England saw a series of markethalls with different names spring up, often at the experience of a wealthy local merchant disposed to be generous. The word halle could mean several things then, from a simple covered market to the mighty buildings and complicated organizations of the Halles which were from a very early date ‘the belly of Paris.’ What is of note is that these were mostly permanent and specialized. London, for example, by 1660, halls had “full-time employees, and a whole complicated administration” (Braudel, 33).

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Halles in Britanny, late 16th century

The Halles was a huge combination of covered spaces and open spaces, its pillars holding up the arcades of neighboring houses, and surrounded by a bustling commercial life on the fringes of the central market, taking advantage of the disorder and sprawl and creating more of both to its own profit. Additionally, it marked the beginning of the usage of the term “market” as associated with a specific good such as “labor market.” Though it seems like a minor detail in the history of commerce, the covering of markets, we would argue, is a major turning-point or "break boundary" as "the system generated by the artifact suddenly changes into another or passes some point of no return in its dynamic processes" (quoted from Critical Techniques page). Once markets were covered and centralized, we see that the political interventions on markets would follow to delimit the contingent and spontaneous nature of markets.

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800 Market Towns in England/Wales 1500-1640

With the springing of markets all over various cities, towns began to intervene, once again, through spatial restrictions. London, again, provides a very enlightening example for Braudel. With the London market came the dislocation of the traditional market (public, nothing could be concealed), producer-vendor and buyer-consumer meet face to face. The distance between the two was becoming too great to be traveled by ordinary people. The merchant, or middleman, had already, from at least the thirteenth century, made his appearance in England, as a go-between for town and country, in particular in the corn trade. Gradually, chains of intermediaries were set up between producer and merchant on one hand, and between merchant and retailer on the other; along these chains passed the bulk of the trade in butter, cheese, poultry produce, fruit, vegetables and milk (Braudel, 42). Moreover, beyond goods of produce and industry (mostly crafts), land also became traded on the market. The market is then, in turn, a coterminous concept with “commodity,” as it becomes a facilitating medium for commodities. It becomes the connection, or encoding interface by which the commodity could be transformed from use-value to exchange-value. By encoding, I mean to suggest that the market becomes part of the grammar of commodities in market capitalism. How this functions I would argue is that the market becomes the system of rationality that is able to bring within a bounded geographical and symbolic system, effectively doing away with the barter system of mercantilism, and instating a mode of representation with its unit of measurement being the commodity. After it is enclosed and encoded, the market becomes the sole means by which to exchange, thus acting as a formal prohibition for all economic activity. Markets become the dominant economic media. The market then is the condition of possibility for commodities, but “the null point of social community (Buck-Morss, 437). Susan Buck-Morss goes so far as to argue that the market then elicits a certain mode of subjectivity that undergirds the market and commodity—the economic actor that is a, harkening back to the Freudian theory of human as a “bundle of instincts,” a “bounded rationality” (Buck-Morss, 466). Bounded rationality for Buck-Morss, is indicative of the effects of market-encoding or market-modeling that points towards the “depersonalization of exchange” (Buck-Morss, 437).

Theatricality in the creation of a consuming subject

Although there is much disagreement as to when consumer culture emerged fully formed, it is clear that the social transformation that accompanied its arrival required an unprecedented effort to pursuade individuals to adopt the lifestyles of consumers. As with the adoption of currencies, and the issuing of credit, the transformation of any financial behavior must involve both overcoming fraud and the overcoming of doubt in the stability/necessity of the system itself - both of which might best be understood as hacks which exploit weaknesses in a system that relies so heavily upon a fragile understanding of how markets function and what activity is housed within them.

With respect to the physical space of the market, it is of crucial importance to note that the rise of consumer culture in the United States was inextricably linked to the pursuasive use of theatricality to embed market activities and commodities themselves with auratic "magical" qualities. consume as a way of life. The combined forces of advertising, branding and strategic exhibition of foreign objects, colluded in an elaborate performance which sought to embed curiosity in consuming subjects eager to witness the magic of a marketplace disrupting traditional social fabric.

Semiotics in the Liberation of Function from Form

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Robert Venturi's "Recommendation for a monument" from Learning From Las Vegas, 1972

... ours is not the environment for heroic communication through pure architecture. Each medium has its day, and the rhetorical environmental statements of our time – civic, commercial, or residential – will come from media more purely symbolic, perhaps less static and more adaptable to the scale of our environment. The iconography and mixed media of roadside commercial architecture will point the way if we will look. Housing for the elderly on the Oak Street Connector, if it had to be a monument, would have been more economical, socially responsible and amenable as a conventional apartment building,lost by the side of the expressway, with a big sign on top blinking, I AM A MONUMENT. Decoration is cheaper.

- Robert Venturi,"Learning From Las Vegas," 1972

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The Upper Strip Looking North
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A Vegas chapel: function legitimated through semiotics

When Robert Venturi looked to the vernacular architecture on the Las Vegas strip in the late 1960's, he saw a resurrection of symbolism in the built environment that had seemed destined for extinction in the wake of architectural modernism. Whereas the Bauhaus' legacy in modernism had stripped buildings of ornament in an attempt to unify form with function, Venturi was amazed to find a Las Vegas strip dotted with generic buildings differentiated only by elaborate ornamental signs designating the unique functions and identities of otherwise identical spaces.

The Vegas strip not only violated a progression away from decoration (which led many to credit Venturi's text as the first postmodern architectural manifesto) but brought more clearly into focus the impact of the automobile upon architecture that needed to be identified from greater distances over shorter durations of time. Whereas the heroic communication of pure architecture had in the past led to forms and facades which - albeit imperfectly - communicated the activities contained within them, Venturi noted that in a land of highways and commercial strips the same system of (road) signs that enabled standardized navigation of an entire continent also enabled a faster recognition of the buildings and spaces one passed by. The vital necessity of introducing semiotic distinctions between buildings exemplified the spatial distortions that accompany accelerated movement and the distribution of communities across expanding territories.

Whereas the built environment brought countless aspects of human activity into existence by anchoring them in physical space, what Venturi exposed was the cultural appropriation of semiotic systems to designate spaces whose distinctive architecture had not yet been invented. In his iconic “Recommendation for a monument” his sarcastic suggestion that decoration upon generic form was the most ethical and economic method of design, exposed the complete lack of subtlety in designs that managed to serve specific functions in the absence of architectural innovation. Rather than create a home for new human activity, it was clear that one need only name a space in order for it to serve a specific function. Although modular, multipurpose, space had been realized long ago behind the glass curtain walls of modern skyscapers, after 1972, one could not escape the vulgar conclusion that the space itself was a nostalgic theatre enabling the suspension of disbelief which designated the offices of one box from the warehouse or monument of another.

In essence, symbolism had invaded space rendering residual communicative modalities in architectural form (the steeple, the column, the storefront) which directed activities within them unnecessary. In a traditional town one might recognize a church by a steeple, and civic institutions by classical architecture – but in Las Vegas one needed only to read a sign that read “CHAPEL” and a marriage could be performed. Resistance to the glass curtain and the modernist box need not be overcome by a radical re-education of a public in modernist aesthetics, but by the complete removal of ambiguity through the ultimate abstraction of the sign. Buildings had entered a realm of mediation, and the Las Vegas strip presented an intermediate phenomenon whereby one could could navigate a foreign landscape and locate a desired service or commodity in spite of all unfamiliarity with the landscape itself.

Venturi's Monument, like a Vegas chapel, anticipates the remediation of spatial phenomena in immaterial spaces and illustrates that function itself is not material, but something performed by actors engaged in a collective fiction. Once it was plainly clear that all the world was a stage, it followed that with the proper, scripting, semiotic device, the market no longer needed to be a specific locality in order to function as a market.

Market as Stage: A comparison of three Stock Markets

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NASDAQ's only physical manifestations are purely symbolic, they fully realize Venturi's conception of an alternative medium housing the functions that previously required a complex and unique architecture

On February 8, 1971, a year prior to Venturi's publication of "Learning From Las Vegas," the world witnessed the birth of the first purely electronic stock market, NASDAQ. In contrast to traditional stock markets, NASDAQ's elimination of a trading floor helped to minimize the spread between the bid price and the ask price of a stock through it's computer bulletin board system. Although the market initially did not connect buyers and sellers directly, it presented a successor to over-the-counter finance and introduced a market function that did not depend on person to person trade. NASDAQ initially relied upon the use of telephones to connect buyers, brokers and sellers, yet currently relies upon electronic communication networks. As the world's largest stock market, in terms of companies listed and trades per day, NASDAQ is a functioning market without the spatial enclosure of a market, a product of the information age, and a phenomenon which illuminates the theatrical gestures elsewhere to preserve and exhibit a non-essential spatiality.

The New York Stock Exchange
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Chaos on the NYSE trading floor constitutes genuine trading activity kept alive through the hybrid market's "cake mix effect"

Although the New York Stock exchange no longer engages in over-the-counter trading, its trading floor is a bustling theatre of trading activity. The floor itself might be seen as an obsolescent inefficiency, yet it is worth noting that in dollar volume, the NYSE remains a larger market than the NASDAQ despite having less listings. The NYSE is called a hybrid market because customers are given the choice of whether to send orders for immediate electronic execution or whether to submit an order to the trading floor for trading in the auction market. The preservation of human interaction on the floor itself seems to embody a nostalgia inherent in "the cake mix effect" whereby the efficiency of a sequence is interrupted by redundant steps as a defense from the obsolescence of a sequence understood to have cultural value. The floor is a tradition that is alive and well, yet this phenomenon eludes the mere prerequisite of market function, effectively defending a culture whose continued presence preserves an illusion that the market is still a market.

The Shanghai Stock Exchange
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The empty trading floor in Shanghai

In perhaps the most bizarre isolation of medium from message at a time when the space of a trading floor is obsolescent, the Shanghai Stock Exchange, though entirely electronic like NASDAQ, has a trading floor which serves no market function in performance or otherwise. As a relatively new market, the physicality of a trading floor lends authority to the electronic transactions which occur in reference to it, yet it simultaneously sits as the vacant theatre of a performance which never took place. Whereas the NYSE might be understood as a monument to trading which lays claim to cultural capital and ensures continued longevity, the Shanghai Stock Exchange physical existence seems in contrast to be legitimizing a market dependent upon foreign investors that equate the physical market with a "real" market worthy of investment. The market extends Robert Venturi's visual joke into unexpected territory, announcing "I AM A MARKET" in spite of foreign anxieties which might argue otherwise.

The Market as an Object of Representation and Modeling

This section will look at how the market as an object was subsumed by "the economy," following Timothy Mitchell's argument in his article, "Economists and the Economy in the Twentieth Century". Mitchell argues that the objectification of the market and the economy is accomplished by economic, econometric, and governmental attempts to keep track of monetary exchange. In other words, measurements of the market serve to constitute the object they seek to measure (Mitchell 2005). Following Mitchell's argument and drawing from Randy Martin's book, An Empire of Indifference: American War and the Financial Logic of Risk Management, we propose that the death of the market as a media object was accomplished by the same process that made it; measurements of market activity become the condition of possibility for this activity in such a way that measuring and regulatory acts become immanent to actual commodities. Commodities now no longer need the frame of the market to act as a structure, providing the affordances and prohibitions of exchange. Now these regulatory/technical capacities are embedded in commodities such as derivatives and securities, as Randy Martin demonstrates. Statistical calculations are themselves valuable, regardless of whether there is value in the object of their calculation. (For example, a loan shark can make a profit off of impoverished subjects, even though the subjects themselves have no surplus.)

The Market as a Medium

In addition to asking how the market comes to be an object, it is relevant for this project to ask, to what extent can the market be characterized as a medium? And, insofar as it is a medium, to what extent can the market be characterized as a dead medium?

In order to answer these questions, one must consider different definitions and uses of the word, market.

1) Fernand Braudel defines the market as that which mediates between material life and economic life. This understanding is obsolete because the possibility of mediation requires a prior separation between the two entities--in this case material and economic life--being mediated. A Marxist reading of capitalism, especially as it was taken up by Michel Foucault in his concept of biopolitics, suggests that material and economic life are no longer separate, that the economy has become a condition of possibility for material life, and is therefore immanent to it. The market as a medium in this regard is dead.

2) The market can also refer to a physical place where commodities are exchanged, as in a marketplace. This is similar to Mitchell's discussion of the market before the use of the word economy to refer to an object of economic analysis. This market is an inert space where the lives of people and the fruits of the land interact. In this case it is a passive medium through which commodities are exchanged. The message being mediated is the trade between the commodity and money, but the marketplace does not mediate this message. The medium is actually the socially agreed up or legal rules that determine the contract of exchange. It is these rules that construct the space as a market, and it has been proven that exchange can happen without being enclosed in a spatial entity determined to be a marketplace. The market as a spatial entity is dead insofar as merchants and buyers no longer have to go to a physical place to engage in acts of exchange. The contracts determining an act of exchange do not require all parties to be in the same place, and with the internet, parties engaged in an act of exchange to do not have to make contact at the same time.

It is even necessary to consider the death of exchange, for exchange implies that all parties lose one object (either a commodity or money) and gain another. However, value is now generated from situations of loss and lack, and from the differentials between predicted prices (See section entitled "Investing in Risk" below). Greg Goldberg proposes in his dissertation on digital network technologies, that because digital media are transmitted without being transfered, in other words, because one can replicate a digital file and send it to someone else without losing it, there is no act of exchange in this transaction. Following Goldberg's argument, It may be now be possible to talk about a production of value independent of exchange (See Goldberg 2008).

3) The market is also a conceptual category referring to a specific type of commodity that can be bought and sold (i.e., the job market, the stock market). The stipulation is that there has to be more than one seller offering the commodity to at least one buyer. The sellers exist in a market competing for the buyers, who can choose between them. In this case the competitive conditions impact the price. There is argument about whether this type of free market in which prices are determined by supply and demand under conditions of competition is alive or dead. Manuel DeLanda argues that capitalism is an anti-market because price is regulated by factors other than supply and demand in a competitive market; in other words, price is imposed from outside the market (DeLanda, Markets and Antimarkets in the World Economy).

4) Another meaning for the word market is an aggregate of economic exchange in a given totality, such as "the U.S. market". Mitchell argues that the market in this definition is an object of calculation and analysis, and that therefore the acts of objectification comprise the object we know as the market. According to Mitchell, "the distinction between market and non-market or capitalist and non-capitalist should be considered not as a thin line but as a broad terrain, in fact a frontier region that covers the entire territory of what is called capitalism" (Mitchell 2007, 7). By this logic, capitalism is a sort of matrix or substrate made of the technical enactment of boundaries between inside and outside. The boundary-making itself is the substance of capitalism. This speaks to McCluhan's famous statement that "the medium is message". In this case the analysis of markets become the condition of possibility for markets, and this condition of possibility is the actual medium.

The question remains, what message is being mediated here. Mitchell's analysis serves to show that the market is not actually a bounded object, and because of this we can presuppose autonomy for any entities between which the market mediates. The market is no longer a medium.

The Market as an Organic Body

In Braudel's definition of the market, his use of the term "economic life" implies that economic activity is alive, or that it is a site where life happens. Timothy Mitchell finds that dominant ideas of the market before the 1930s treated it as an aggregate of life forces, or "individual utilities" (Mitchell 2005, 129). The Malthusian relationship between land fertility and population size comprised the object of analysis as "an organic world of human settlement, agriculture, and the movement of populations, goods, and wealth" (Mitchell 2005, 128).

Towards the end of the 1800s, the idea of the market as a separate surface began, but it was not yet a "self-contained sphere, imagined as machine whose internal mechanisms and exchanges separate it from other social processes (Mitchell 2005, 128). Rather, "The object of analysis was made up of forces, conceived as individual utilities, that were assumed to be in balance. The site of this mechanical equilibrium was 'the market'.... As a neutral, planar surface, the market of neoclassical economics had no depth, no dynamic structure, no forces of its own, no 'macro' dimension that could be described apart from the individual utilities that moved across it. It was an inert, unmoving space" (Mitchell 2005, 129). In this characterization, the market was not seen as a system. It was rather a space that could be filled with individual energy; this is quite different from the current idea of "the economy" as a thermodynamic system in which the whole exerts force onto each of the parts. In this older conception of the market, the equilibrium of individual forces was not imposed by a greater whole, but seemed to arise naturally.

Mitchell argues that the term, "economy" was not used in its contemporary sense, as an object of economic analysis, until it was actually taken as an object of economic analysis by econometrics in the 1930s. This was around the same time John Maynard Keynes began to refer to "the economic system as a whole" (Mitchell 2005, 130). Mitchell characterizes econometrics as "the attempt to create a mathematical representation of the entire economic process as a self-contained and dynamic mechanism" (Mitchell 2005, 131). At this point the dynamism of the economy incorporates or subsumes a collection of markets into itself. Economic processes are seen as a totality and it is possible to distinguish between that which is internal and that which is external to this totality. External forces impact the economy, causing "reverberations throughout the internal machine" (Mitchell 2005, 133).

This notion of the economy as a system seems to persist, but perhaps with an important development. It is still understood as a systemic totality, but the external forces that impact it have been subsumed into the economy (partly through the statistical measurements of aggregates and averages such as gross national product and average spending). It is understood more like an organism than a machine requiring a human laborer. Randy Martin describes this organic model: "An economy could become overheated and melt down or explode. The social sciences more generally were predicated on this image of a closed system. The system adapted to internal strains by growth and differentiation. It maintained boundaries, kept out threatening uncertainties, and externalized unintended consequences from its internal decisions" (Martin, 28-29).

The Death of Equilibrium/Equilibrium as Death

Organic models of systems describe systems as thermodynamic, operating like a thermostat that adjusts to external stimuli, or adapts external stimuli to it, in such a way that the system maintains equilibrium. Business cycle models of the market speak the language of thermodynamics because the market returns to the same stages each time it goes through a cycle. However, some contemporary critiques of capitalism argue that capitalism operates more as a state of instability than a system at equilibrium (See Clough 2007).

Randy Martin looks at this problem of equilibrium/disequilibrium in terms of the financial logic of risk that, he argues, has permeated economic thinking and has defined the subject as an investor. Martin traces the U.S.'s switch from a creditor to a debtor nation in the 1980s, when the nation began to operate through consumption without production. During this time risk became a sign of strength and power and the need for stability was a sign of weakness, now associated with the third world (Martin, 28). Being in debt, which used to be a sign of weakness, became a source of value. Debt is repackaged into securities.

Beginning in the late 1970s after the U.S. dollar was delinked from the gold standard, "monetary movement was being freed to spread the wealth. Equilibrium-- key to Bretton Woods and early monetarist currency controls-- was no longer a condition of exchange. The dollar's spread, the expansion of debt and speculation, fostered disequilibrium and its attendant risks as a new horizon of opportunity. Fixing exchange to a physical standard perpetuated the image of the economy as a closed system. It could grow in proportion to the balance of inputs and outputs" (Martin, 29). According to Martin, money's attachment to the gold standard provided a kind of mystification that had a performative function; it created a "system-based moral and political economy" that was then overtaken by financial reason: in Martin's words, "when the investor who knows no country elbowed out the consumer-citizen of the nation-state, the organic closed system, result of the social sciences' unacknowledged metaphorizing of the social, was morphing into a different kind of beast" (Martin, 29). The a delinking of the subject from the nation-state goes hand-in-hand with the advent of the investor, who is a self-managing risk-taker.

Within this finance economy, speculation is the only way to thrive economically, and speculation relies on both present and future instability and unpredictability (for more on unpredictability, see Clough). It is the very lack of predictability of capitalism that makes speculation such a profitable game; if the economy were truly predictable, than there would be no competition for correct guesses and measurements, and a securities package would not be a commodity.

Futurity in the Present

Another way to probe this idea of the death of the market as a system at equilibrium is to think about the non-linear time made possible by predictions. As Martin illustrates in his discussion of derivatives, they are a way of turning the unknown future into a value-generating product in the present. Luciana Parisi and Steve Goodman argue that the eruption of branding as a value-generating device is also a way of actualizing the future in the present: "In its infinite differentiation of product ranges, branding plays with a combination of familiarity plus novelty, a past-futurity. New memories installed that you have not phenomenologically experienced in order to produce a certain receptivity to brand triggers" (Parisi and Goodman, Pnemonic Control 2006). This is one way in which Clough et. al argues that capitalism can no longer be described as an enclosed system, because of its openness to different temporalities.

New Encodings

A capitalist market needs to have what Timothy Mitchell calls an "apparatus of representation" in order to convert material into abstract capital. He argues that failing capitalist economies differ from their succeeding counterparts because of how their wealth is held, not because of how much wealth they have. It is a matter of coding material into a symbolic system: "Representations of material goods transform their value into abstract forms, which can live an 'invisible, parallel life' alongside their physical existence. The West has invented procedures to create these invisible forms. Individuals in the West can unlock the assets accumulated in physical property, transforming material wealth into abstract capital" (Mitchell 2007, 9).

Evidence of this claim lies in how markets and nonmarkets are distinguished by economists: " describing what this nonmarket world lacks, neoclassical economics tends to diagnose its defects as an absence of techniques of representation. Things are stuck outside the market because they are not properly represented-- by property records, prices, or other systems of reference. What economic analysis does, however, is not to represent what was previously unrepresented, but to try and reorganize the circulation and control of representations" (Mitchell 2007, 7). This circulation of representations is not only happening in the realm of the social sciences, but is an economic circulation. In fact, a derivative can be described as a packaged representation of a fluctuation in price that can be bought and sold as a commodity. This exemplifies the way in which value is generated by coding, not merely by quantities of material wealth. Perhaps this can be seen as a kind of self-coding, or immanent coding. (This discussion is raised in Clough et. al in terms of matter's capacity to self-form and how this is taken up by capitalism.)

Coding of Risk, Instability

How shall we understand market activity after the market is no longer an object, after it ceases to be constituted as a system at equilibrium? Instead of coding material goods as valuable (Mitchell, 2007), Randy Martin argues that capitalism is following a financial logic which extracts value by predicting future price fluctuations, interest rates, and exchange rates, and packages this risk into new kinds of commodities, such as derivatives and securities. According to Martin, "Properly ascertained risk, not growth per se, is what yields rewards. The trade in risk avoidance devolves into a profit on risk itself" (Martin, 33). [edit]


A derivative is a contract on "some variation in price" (Martin, 31). Martin gives the following examples: "a firm selling a product overseas that will not be deliverable for several years will create a contract to fix currency exchange rates for the time when the product is finished. The expected difference between current and future exchange rates can then be sold as a separate commodity... A similar contract could hedge against a change in interest rates, or the price of raw materials, or delivery costs" (Martin, 31). In Martin's analysis, "Derivatives remove reference from the commodity. They allow debt to serve as a productive medium from which countless commodities can be spawned" (Martin, 31). This exemplifies the extent to which measurements of the economy have become productive of profit, circulating as commodities themselves. The act of measuring used to be understood as an external act applied to the economy as an object. Now it is clear that this boundary-making activity is itself a valuable form of labor.


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