• Embed Doc
  • Readcast
  • Collections
  • CommentGo Back
Download
 
 
IS THERE ANY LAW OF NATURE BEHIND THE FINANCIALCRISIS OF 2008-2009?
Overview of 
 INTRODUCTION TO PATTERN CHEMISTRY 
 by Yuri Tarnopolsky
Pattern chemistry is an attempt to answer the question:What is so different about human matters, including history, politics, economy, etc., ascompared with subjects of natural sciences?That was, in essence, the question asked by George Soros in his “
The Alchemy of  Finance
” and subsequent publications on “reflexivity.” The roots of the question are asold as science and philosophy.The
INTRODUCTION
is written in an idiosyncratic form and is anything but a“theory.” The author of the INTRODUCTION is a
chemist
(Ph.D.)—neither economist,nor philosopher, neither investor, nor (currently) university professor—who has beenclosely watching historical global changes since 1956, first from communist Russia and,since 1987, from capitalist America, including the progress in both sciences andhumanities where the author was quite amphibious. The financial crisis and electioncampaign of 2008-2009 were especially stimulating for the “generalized chemistry” project, started back in 1979, and they speeded it up to conclusion.Pattern chemistry is based on (1) ideas of Pattern Theory developed by Ulf Grenander and (2) generalization of some fundamental concepts of chemistry, in particular, theconcept of transition state.The concept of 
pattern
has been in circulation in both sciences and humanities sincePlato. Although outside Pattern Theory it is one of most evasive notions, pattern alwaysimplies a kind of “invariance” or “regularity” which appears in a range of differentobjects. What distinguishes the author’s approach from other studies is that he considers patterns not within a certain discipline or field of study, for example, patterns of history,
 
language, behavior, in image recognition, etc., but
across the interdisciplinary borders.
Obviously, this makes little academic sense.The central object of pattern chemistry is
exystem
: evolving complex system for whichthe unpredictable novelty is the main property of interest. A typical—and the largest— exystem is
economy
, which today includes all spheres of human activity and incorporatesnot only art, science, technology, markets, finances, ideology, religion, education, politics,family, etc., but also the fate of all living organisms on earth, climate, mineral resources,and large scale trends of human civilization.We do not—and cannot— know the future even in the case of the financial markets,although they are studied as an academic discipline and involve a large number of brightthinkers, some rewarded by the Nobel Prize. We know only possible alternatives andscenarios, never complete and never consensual. It is the fact of the matter that althoughsome economists had unambiguously warned about the inevitable danger, their  predictions made no impression on either politicians, or institutions, or public. On thecontrary, the election of Barack Obama was something no serious person could predict before well into the campaign. The story of global warming is up for the next case study.A striking feature of the financial crisis is that it has been generated by the very economicstrategies employed to prevent it and insure against the loss. One may also notice that theglobal policy of the United States, for decades strategically aimed at the stabilization of the world, had exactly the opposite effect of deep destabilization—after a long successful period.The question addressed in
INTRODUCTION TO PATTERN CHEMISTRY
isformulated as follows:
If we cannot fully know the future and cannot predict the exystemic event because it is irreversible and happens only once, how far can we still look intothe future and what can we still know about it with certainty?
The hypothetical answer is that patterns, unlike configurations “covered” by them, canhave a relatively long term validity, but at the price of high generality and abstractness,even bordering with triviality. In order to extract the scant but reliable and importantinformation, we must
generalize the principles of natural sciences
as much as possible,so that they would be applicable to both physical and human matters. Patterns, unlikeequations, thrive in both sciences and humanities because they are basic and universalforms of human understanding.For example, we should probably speak about
instability
instead of energy,
event
 —withthe beginning and the end—instead of process,
inequality
of distribution instead of entropy,
waste
instead of heat, and a measure of 
fluctuations
instead of temperature. Inaddition, we should abandon the use of the concept of probability for non-repetitiveevents and incomplete (open) event spaces. The improbable event has no probability.Thermodynamics applies only to well defined systems, while the future is the least
of 00

Leave a Comment

You must be to leave a comment.
Submit
Characters: ...
You must be to leave a comment.
Submit
Characters: ...