Issue 1.

5 Scenes of Knowledge

THE BLACK SWAN; by JOSEPH VOGL

Preface
Political economy has always nurtured an affinity with spectrology and has made sense of
the course of economic events as if they were controlled by invisible hands and other
hauntings. This may be due to a certain uncanniness of economic processes, in which
circulating objects and signs develop an eerie will of their own. Since the eighteenth
century, market mechanisms and stirrings of capital are perceived as mysteries, the
solution of which the self-enlightenment of modern societies measures itself against. This is
particularly true for movements and structures of modern financial economy. Although
financial markets can be understood as events during which a substantial part of human
welfare is decided, what happens precisely at those events, remains obscure. This applies
not only to the operative behavior, mentalities, practices or theories, but also to the
general dynamics, which, with sublime, i.e. inconceivable sums of money, have become
a reason for current social and global conditions. The course of events is determined by
financial matters, and it is therefore all the more important that the rules and logic behind
the interconnectedness of events are highly debatable. It is particularly the so-called
crises in the last decades that have prompted the question of whether an efficient
interaction of rational stakeholders or a spectacle of pure irrationality takes place at the
sites of the international financial economy. In any case, it is not yet discernable, whether
the therein conjured up capitalist spirit operates reliably and rationally, or simply in a
crazy manner.
This has resulted in a multiple problem of interpretation. For as much as an economic
world view may have been construing the relations between people and things in a
particular way for some time now, an economic science, in turn, feels called upon to
1

make the thus created entanglements comprehensible. One thereby encounters the
also hermeneutically complicated fact that the economic knowledge of the last three
hundred years has created the economic actualities which it has to decipher. The
following reflections are dedicated to this situation. They refer to a couple of constellations
of economic knowledge from the eighteenth century to the present and in the process,
revolve around those seemingly unheard-of incidents which like financial crises or

crashes have made the course of economic processes inscrutable. However, this is not
about recipes for the necessary reorganisation of the current economic system. It is much
rather an effort to understand how the modern financial economy tries to comprehend a
world of its own making. In it, the spectre of capital appears as a cipher for those forces
that our present receives its laws from.

The Black Swan

Cosmopolis. It was in New York, on an April day of the year 2000. The twin towers of the
World Trade Centre were still standing. For more than one hundred months, the American
economy had been growing inexorably, the Dow Jones Industrial had just reached an alltime record peak and surged past the 11.000 points mark, and the electronic trading at
the NASDAQ was driven by a downright race. From the top floors of the Trump World
Towers near the UN headquarters, the dawning day provides a view of the East River, over
the bridges and smoke stacks of Queens, to a distance beyond the suburbs, dust plumes
and flocks of seagulls down below. After a sleepless night, a 28-year-old billionaire asset
manager decides to leave his apartment above Manhattans East Side to visit a
hairdressers on the shabby West Side the place of his childhood. He takes one of the
private elevators down, climbs into his oversized white armoured limousine, which is
shielded from noise with cork padding, and equipped with surveillance cameras and
countless screens for world news and market quotations. His driver, his chief of security and
chief of technology are on stand-by. The car turns onto 47 th Street heading west, passing
block after block. By late night it has blundered through a series of adventures and
complications that would justify calling the journey an odyssey. The asset manager meets
his wife as well as his various mistresses. The assassination of the managing director of the
International Monetary Fund is reported, and also that of a Russian oligarch and media
entrepreneur, who has been a friend of the young billionaires. In congested traffic, one
crosses Park and Madison Avenues, passes through the old Jewish quarter, reaches the

theatre district near Broadway and is delayed there by the turmoil of an anti-globalisation
demonstration. A bomb explodes in the entrance of an investment bank; one witnesses a
young mans self-immolation and shortly thereafter the speculator himself becomes the
victim of a pie attack. Suddenly, and without any particular reason, he kills his head of
security before reaching his childhood hairdressers near the docks. Again for no reason
and hastily, he leaves the hairdressers, becomes entangled in a nightly film shoot with
three hundred naked extras and meets his wife by chance, for the last time. In an
abandoned ruin of a house, he is met by a former employee, who he comes to realise is
his murderer.
With this peculiar story, Don DeLillos 2003 novel Cosmopolis leads to the sites of modern
financial markets, touches on the question of their narratability and for this purpose
musters a string of narrative and argumentative figures that rearrange the enigma of the
financial economy, its personnel and its operations. With a New York speculators day trip
to the hairdressers in Cosmopolis, DeLillo, who had already dedicated himself to the
question of the narrative version of financial operations and stock market speculations in
his novel Players (1977), has chosen a representational practice that results in a synopsis of
perceptions and problem areas of what still has to be called capitalism. This concerns the
profile of his main character, who is conflated into an allegory of modern financial capital
and thereby evokes both historical references and current ideas in economic theory. At
the same time, DeLillos novel pursues a narrative style which, with its hypertrophic host of
events, asks fundamental questions about how, swayed by todays global economy,
incidents interlink with incidents. This is also an occasion to ask about the efficacy of that
fate that this capitalist economy is itself.

Capitalist Spirit. Thus, DeLillos asset manager and speculator assembles several
canonical and long-standing characteristics that have accompanied the careers of
financial operators and stock exchange speculators and that have guaranteed their
recognition for at least two centuries. Endowed with the myth of heedless efficiency, a
predatory instinct and the reputation of specimens, who, young and smart and raised by
wolves, embody the hazardousness of finance capitalism, he fits in with a series that
reaches from Balzacs condottieri and pirates of financial business to Marxs straying
chivalry of credit, to the mad dogs, rogue traders and packs of wolves of todays
foreign exchange markets.1 Furthermore, DeLillos protagonist, with the energetic name
Eric Packer, presents himself as a character mask of or better still: a dream or vision for current financial capital. Not only does he operate sleeplessly and wide awake,

excessively and manically, not only is he at home everywhere and nowhere,

globalisations Odysseus and world citizen of a monetary cosmopolis. He is in fact
characterised by the desire to leave the material worlds heaviness and the empire of
physical circumstances and states of property behind. He dreams of the extinguishment of
use value, of a dwindling of referential dimensions; he dreams of the disintegration of the
world into data streams and of the binary codes autocracy; and he places his bet on the
cyber capitals spirituality that is transmitted into the infinite light, into the glow and the
flicker of the charts on the screens. It is the dream of a radical and final transubstantiation.
While Emile Zolas stock market novel Money already spoke of poets of sublime sums of
money, what is being dealt with here is a most recent modification: a pote maudit of a
new generation of symbol experts", who combine obsession with extravagance and who
commit themselves to money talking to itself (77), a free, artificial and self-referential
play of signs and information, shielded against the remaining world like the cork-lined
limousine-cum-office and thus reminiscent of Prousts insulated study. Lastly, futures
assault on the rest of time takes place here. The words and terms of colloquial speech, so
it says somewhere, are still much too charged with remnants of historic meaning, far too
cumbrous and anti-futurist (54). In contrast, the traces of history are being wiped to the
rhythm of the nanosecond which the oscillators dictate to the stock market and currency
machine, annulled in the maelstrom of future transactions and their derivatives the
present is being sucked out of the world to make way for the future of uncontrolled
markets and huge investment potential. The future becomes insistent (79). As the market
is neither interested in the past nor in the present but only in future profit prospects, this
capitals dream is oblivion; it is about the power of future and is fulfilled in the idea of the
end of history.
Given the mysteries of the most contemporary financial capital, DeLillos novel evidently
joins the elements of an older with those of the new capitalist spirit. For on the one hand, it
thereby negotiates the process of that creative destruction which Joseph Schumpeter
once used to describe the addiction to change, the continuous revolutionisation of world
and economy structures in the name of capitalist entrepreneurship: Destroy the past,
make the future (93). Capitalisms forces were never preserving or conservative. On the
other hand, however, they have disentangled themselves from the sphere of production.
With the alliance of technology and capital (31), the culture of the market has become
total and weightless, capital flow becomes unrestricted, frees itself from material
manifestations of wealth and has installed itself in a time beyond geography and

touchable money (36). It dictates its own dynamics and mobility standards and outpaces
all local, social or political embeddings. At the same time, it can even absorb turmoil and
anarchy as an energetic expression of its own system; it can record protests as a free
market fantasy and a critique of capitalism as its consistent self-optimization: The protest
was a form of systemic hygiene []. It attested again, for the then thousandth time, to the
market cultures innovative brilliance, its ability to shape itself to its own flexible ends,
absorbing everything around it (99). This system, DeLillos novel suggests, in a theses-like
manner, adapts in the face of resistance, includes its opposition, incorporates
spontaneous action and perfects itself much in the spirit of a New Management as an
actual creative reserve. It is no coincidence that at one point a headline towers over the
events which written by protesters on an electronic display, on the stock ticker of an
investment banks storefront pilfers the famous beginning of the Communist Manifesto,
modifies it and thus makes the capitalist spirit mistakable for its erstwhile and spectral
counterpart: A SPECTER IS HAUNTING THE WORLD THE SPECTER OF CAPITALISM (96).

Loss of Security. This literary montage of canonical formulae of older and more recent
capitalism analyses which may well reach from Marx and Engels to Schumpeter to
Baudrillard, Boltanski, Chiapello or Rifkin2 merges into a tableau of a most recent
industrial revolution which follows a digital imperative after the reign of steam engines
and the regime of automation and thereby seeks to determine every breath of the
planets living billions (24). The background is in actual fact a technical-economic
change which took place in the founding of electronic markets, the spread of computerbased trading since the 1980s, the expansion of networks, the introduction of ISDN and the
changeover of the frequency spectrum to three hundred megahertz and led to an
exponential mobility increase in capital flows. 3 Central to this euphoric alliance of
information technology and financial capital in DeLillos novel, however, is an event which
takes an disconcerting direction, thereby running an altogether improbable and irrational
course, and which offers up an interpretation of what world means under the banner of
contemporary financial economy. On the one hand, this refers to the course of the
narrated events themselves. For the way of DeLillos allegory of capital does not just lead
from the 89-story luxury residential high-rise to the grounds of shabby backyards, it does
not only lead from East to West and thus follows the direction of the American dream, and
it does not just draw a line from life to death, to the non-exchangeable and to the end of
all transactions. Just as another modern Ulysses also wandered a metropolis for a whole
day, the trajectory of DeLillos protagonist rather points back to an epic passage and to

the course of old odysseys. This results in a Homeric pastiche and the recollection of
Odysseus fate including its variations. Thus the nstos, the detour taken on a long
homeward journey, in DeLillos novel has become a fatal trip to the districts of childhood,
the heros vessel from the Mediterranean Sea becoming a shielded vehicle on unsafe city
streets. The weaving Penelope returns as a billionaire heiress who writes poetry and in
whose arms one does not sink into in the end but instead does so occasionally, repeatedly
and completely coincidentally. Nausicaa, Circe, Calypso and the sirens, oracles and
ogres have taken on the shape of female bodyguards, former mistresses and eloquent
female scholars; of performance artists, masked protesters and unemployed computer
scientists. And the circle of hell, which was reserved for Dantes crafty Odysseus, is realised
in the grim scenery of an endlessly protracted moment of death at the conclusion of
DeLillos novel.
Consequently, this inclination towards the epic in DeLillo does not, to quote Hegel, require
modern fictions reality already organized in its prosaic form. Rather, it leads into a world
of occurrences that are only linked loosely and episodically, that manifest themselves as
external forces and hardships that become calamitous and escalate into fate as they link
up. As seldom as epic events, according to Hegel, correspond with an organised society,
an instituted commonwealth or a lawful order 4, in DeLillos novel they mark the entry into a
zone of elementary danger. While in the beginning of the novel, questions of system
security, prevention, risk assessment, surveillance and hazard control [o]ur systems
secure (12) - accumulate in an almost hyperbolic manner, the storys progress resembles
the process of an increasing loss of security. The President of the United States, this last
exponent of a sovereign power, is nothing but an image of the undead (77), and one
moment is emblematic of that situation, namely when the protagonist releases his chief of
securitys automatic weapon with a spoken code, suddenly shoots him and thus directs
the security dispositif against himself. DeLillos allegory on capital thus leads beyond the
line and onto the territory of an intra-civilisation wilderness which, to the rhythm of sudden
assaults and attacks, carries the stigma of terrorist disinhibition and, moreover, covers itself
in marks of the barbaric. This is the world of hwa-byung, susto or amok, the world of those
culture-bound syndromes that in Korea, the Caribbean Islands or in Malaysia have
become a cipher for the violent outbreaks in which the indigenous peoples suppressed
anger, sheer horror or onsets of panic can be released. 5 This produces a caricature of an
affective primeval landscape in which the excesses of the fanatical tropics (28) blend
with the horror of self-mutilation, carnage and [r]ed meat (14). In the end, DeLillos

protagonist has followed the power of pre-determined events (147) and succumbed to
his imminent death as if to some principle of fate (107). The name of the speculator may
stem from that Roman guard who was on the look-out for danger or accidents ( speculari),
but this scout or seer (46) has now himself grown into the type of a dangerous person
(19), who in the end and following the narratives gradient has become the attractor
of all emerging risks: robbed, abandoned and exposed.

The Unrepresentable. On the other hand, however, this chain of archaic threats,
excessive violence and death wish apparently only repeats an assemblage of events that
is dictated by the flow of global capital transactions. During the entire odyssey through
the streets of Manhattan, the young asset manager speculates for the fall of the Japanese
yen and thereby follows one of the most aggressive financial strategies there is, the socalled leveraged buyout: an acquisition of controlling interests with high prospective
profits which as has recently occurred in the cases of Porsche/Volkswagen and
Schaeffler/Continental is largely financed by borrowing. In the case of Packer Capital in
DeLillos novel that means that shares with potentially high returns on investment are
generously bought with low-interest yen bonds to maximise the speculative profit by
benefiting additionally from the expected fall of the yen. And thereby the unheard-of and
unexpected takes place, the novels actual scheme. The erratic trajectory that DeLillos
protagonist follows from incident to incident until his death, is doubled by the erratic
performance during which the value of the Japanese yen against expectations (8)
inexorably increases more and more, until finally all of Packer Capitals assets are
destroyed and their CEO is ruined another odyssey with a fatal outcome. After all,
DeLillos novel has left no doubt that something completely unthinkable and
unreasonable happens with this yen carry trade, something that has gotten out of
control (85), that does not fit any probable script, makes reference to no plausible reality,
and is metastasising and chaotic. The state of the world has become unrecognisable. If
the notorious worldliness of the modern and present-day novel is associated with the
question of how events arrange themselves and which rules they follow in doing so, then
DeLillos novel records a return of archaisms in modern design and it entertains the
suspicion that the world of the financial system is characterised by an event storm which
has become a cipher for utmost danger. Stock market transactions and the fatality of
brute force: what is documented here is the variation on an assemblage of incidents
which a good ten years earlier had received the title of American Psycho The
turbulence of financial markets and the zones of fundamental danger mirror one another

and inform a narratively logical programme that converts the dynamics of exchange
rates into an epic sequence of fateful events and measures itself against the occurrence
of the most improbable.
The unrepresentable of this stock performance [w]hat is happening doesnt chart
does not only mean an assault on the borders of perception (21) and thus the sublime
amount of unimaginable sums of money, an economical sublime that is not in any form
sensually perceivable and which is evoked by the fact alone, that in the year 2000 for
example, 1.9 trillion dollars circulated through New York Citys electronic networks on a
daily basis and that already in the 1990s, through the latter, every two weeks the
equivalent sum of the global economic output was turned over. 6 In the brokers idiom,
one is rather confronted with a situation (40) here, one of those improbable and random
events that close in incalculably, freakishly and without any leading signs, similar to the act
of a deranged killer who went on a rampage, who previously had been undetected
and lived as a nice person and a good old neighbor next door.7 For situations like
these, the image of a black swan has been assigned, which means a singular incident,
which firstly falls outside of all expected and expectable, secondly, which displays
immense and fatal effects and thirdly, which produces a manifest need for explanation, a
belated search for coherence, causality and plausibility. Just as black swans once
seemed a sheer impossibility in the knowledge of modern-day natural history and thus
became the emblem of problematic inductive reasoning, they now signify a flaw that
breaks up the linear succession of events and leaves us with an incident that is equally
insular, unbelievable and turbulent an excessive contingency. 8 In the end of this episodic
progress, two things have happened. On the one hand, the speculative error has put the
system itself in an unstable position and produced the occurrence of a global crisis: He
knew it was the yen. His actions regarding the yen were causing storms of disorder. He was
so leveraged, his firms portfolio large and sprawling, linked crucially to the affairs of so
many key institutions, all reciprocally vulnerable, that the whole system was in danger
(116). It was indeed for similar reasons that the New Economys market collapsed in the
spring of 2000 and that the technology-heavy stock market NASDAQ experienced a 27 %
price drop within the first two weeks of April, leaving analysts perplexed. 9 On the other
hand, the supposed seer and speculators apparent blindness has to be admitted to here:
The yen eluded me (190). The world has become unreadable, the worlds causalities
vague and the course of events has lost its direction; the series of listings and payment
events does not assemble into an identifiable pattern and veers off course. At the peak of

the financial crisis in spring 2000, DeLillos protagonist finds himself in one of those
uncomfortable situations that Alan Greenspan, long-standing Chairman of the Federal
Reserve of the United States and a persistent advocate of unregulated markets, had to
claim for himself a good eight years later; a position in which his view of the world, his
ideology and long-lasting evidence or interpretations did not work anymore: The whole
intellectual edifice of the financial economy collapsed.10
With these erratic and seemingly irrational movements, DeLillos Cosmopolis of course cites
the fast pace of financial crises which reach from the 20 th into the 21st century: from the
crash of 1987 to the Japanese asset price bubble in 1990, the bond debacle of 1994 and
the Russian financial crisis in 1998, to the so-called technology or dot-com-bubble of 2000,
or to the disaster in 2007 and 2008 and the following years all of them events that
according to all economic probability should never have happened, or, if at all, only
once in a billion years. And maybe DeLillo also wants to refer to the startling and
speculative yen price trend in relation to the dollar here, whose rising value caused the
Japanese economy severe and lasting damage and found its disastrous repetition in the
years between 1998 and 2000.11 But most of all, the narrative obviously circles an event
whose representation equally puts the coherence of the narrated world and the
rationality of the economic world at stake. The concern here is the inventory of plausible
realities [] that can be traced and analyzed (85); it is about the techniques of charting
that predicted the movements on the financial markets (75); and here, with the yens
baffling exchange rate and its ruinous effects, appears a form of an unheard-of event
that challenges all hermeneutic efforts and asks no less than an adequate explanation for
that event, i.e. for its way of connection, its motivation, its expectability and its possible or
likely development: The yen is making a statement. Read it. (21). What kind of event is a
current market value, what is expressed therein, how will it change and which future
course could it take, how inevitably or randomly are events connected with each other
and how erratically or linearly does this happen? All of these are questions central to
DeLillos narrative scheme, but are also the focus of finances will to knowledge. The
literary text and the speculative play of signs equally pose a problem of reading.
Apparently there is the intrusion of an unexpectable and once again, using a
Greenspan expression the dynamics of an irrational exuberance that puts the system of
economic rationality, or, the systems rationality, to the test.

Perplexity. This inevitably points to a certain perplexity within the economic knowledge
itself, to an open question about whether and how any idea of coherence can still

manifest itself here. For ultimately, economics, this present-day religious doctrine of ours,
has completely different and conflicting interpretations in store to explain the events and
event storms in current financial business. The first is orthodox in its nature, dates back from
the market fundamentalism of the Chicago School and is called Efficient Market

Hypothesis. According to the hypothesis, it is the financial markets in particular that

represent market situations par excellence and at the purest. Untroubled by transaction
costs, free of transport and the hardships of production, they are ideal and friction-free
sites for pricing mechanisms and perfect competition, appointed with rational, profitoriented and hence reliable economic stakeholders. Therefore the respective prices and
price movements on these markets reflect all available information immediately and
exhaustively. Provided that under the best possible market and competitive conditions, all
stakeholders have the same access to price-sensitive information concerning speed and
the extent of access the current listings always state the exact truth about the economic
situation. The corresponding assets are never really either over- or undervalued. And
potential errors or inefficiencies, i.e. large divergences between the actual and the
projected profits, are merely due to varied and bothersome obstacles in the way of free
market movement, and can quickly be fixed. As late as 2007, it was still a clear case to
Eugene Fama, one of the founding fathers of this school of thinking, that the denotation
and the matter of bubble in the context of financial markets were equally unfounded
and absurd.12 All crises and depressions would then be nothing more than moments of
adjustment and would only document the relentless course of economic rationality. The
market itself is what is real and thus the rational, per se.
Another interpretation is a little more conservative, but no less orthodox. Here, one does
indeed using the example of various financial crises speak of bubbles, of runs, busts
and booms, of financial panic or euphoric escalations; and semantics of this kind have
been used since the 17th, but mainly since the 19 th century to address the bare irrationality
of a speculator business that, on principle, has detached itself from all rules of the
commodity market, from the principles of economic rationality and from the basis of socalled real economy. It was Daniel Defoe who attested to the stock jobbers proneness to
all kinds of blindness and deceit, and who found the exchange business altogether
abysmal and its dealings unreasonable. And later the stock exchange and speculation
trade from the Dutch tulip mania to the English South Sea Bubble or the French Mississippi
Bubble were identified as exemplary sites for the effectiveness of mass hysteria, herd
behavior and blind imitative instincts. Later, one was inclined to view the high volatility of

10

financial markets as a reason for the fact that great price fluctuations simply cannot follow
any rational expectations and that the markets themselves therefore operate most
erroneously, inefficiently and irregularly.13 The unavoidable over- or undervaluation is
unflinchingly acknowledged here, because after all, it can be traced back to the
influences of foreign, external factors outside of the economy: emotions, dilettante acts,
gambling mentality, greed or simply a lack of reason. Up until the latest collapse, financial
markets and stock exchanges virtually battle a problem of inclusion too many players
carry out far too incompetent operations, or they harbour sinister inclinations that together
unleash irrational movement and from time to time simply create exceptional economic
situations. Accordingly, the market here is neither rational nor efficient, but utterly clueless.
Movements in prices on the financial markets have repeatedly been described as
turbulent flow and drifting molecules.14 Moreover, not only can the dissenting opinions of
the different schools be observed here, there is also a flagrant discord about what
connects payment events with each other and by which forces, and with which
rationality or irrationality the financial economic process, its dynamics and anomalies are
motivated. This problem is complicated further by the question of where the reference
points of the economic game of signs, the price movements and the chain of listings lie
how the series of prices and price fluctuations on stock and financial markets are to be
read and interpreted and which representative potency they hold. In light of this semiotic
question one may again detect a peculiar ambivalence within financial economys
knowledge. On the one hand, a so-called fundamental analysis concentrates on aligning
price fluctuations on the financial markets with basal economic data factors such as
productivity, profit situations, cost structures, projected dividends, discount rates, trade
balances or purchasing power factors which all represent a well-founded reference for
semiotic events and a realistic and objective value orientation. According to this, as it
were, classical view, financial prices and listings oscillate in the long run around the intrinsic
value of companies or whole national economies; and the booms and trends on the
markets would only be the more or less direct expression of a silent economic reality which
will finally prevail with its true and real substrate of value. 15 The movements on the foreign
exchange and stock markets, their signs and listings therefore become transparent to a
substantial reference system and find a sufficient base in the fundamental economic
data.
On the other hand, the common practice of technical analysis operates on a type of
forecasting that strictly puts these referential dimensions aside. It is the privy banking and

11

stock market personnels science of reading mysterious codes, which coming from
operational research and computational finance receives prognostic clues for shortterm investment decisions from the characteristics of the charts alone. This is about the
depiction of probable price movements and the hopes and expectations that have
coagulated into a picture. As early as 1884, Charles Dow had calculated the daily
average of the twelve most important stock quotations at Wall Street and thereby
claimed to have identified clear profiles of price movements and different daily,
monthly, perennial chart patterns, a sort of barometric reading for the general business
climate. And at least since the 1950s, this has developed into a successful business
practice which is concerned with deciphering the meaning of recurring graphic patterns
and concluding probable futures from previous market listings. Better than in all other data
for example, intrinsic ones or book values of stocks and bonds the evidence for the
state of markets, definite shapes and the significance of graphs that point to hidden
rhythms in the fluctuations of stock prices and currency exchange rates, supposedly
reveal themselves therein. Chartists and analysts might speak of trend lines and trend
channels here, of bearish and bullish patterns, of inverted saucers, head and
shoulders top, scallops or flags and pennants all of which are characteristic
formations that indicate trend developments and their reversal points. These graphs do
not so much represent underlying references to value. The decisions for a purchase or a
sale are rather calculated according to how price signals interlink with each other and
what pattern or syntagma they form in doing so. On the one hand, this results in a kind of
clean copy or calligraphy of the economic world: in the trading rooms, the signals from
the outside world form a noise-free tableau. On the other hand, the biodiversity of an
economical morphology can be found to gather in it. Just like the cycles of nature, the
market repeats the same old movements in the same old routine, over and over again;
history solidifies into a repeatable form.16

Oikodizee. These established models, positions and practices, which public finance has
used to explain and depict the process and the time dynamics of pricing on the foreign
exchange and equity markets since the second half of the twentieth century, therefore
revolve around the enigma of price movements and fluctuations, with all the related
problems of timing and forecasting methods and, as a whole, attest to a certain
perplexity. The need for explanations regarding financial matters challenges a wide
economic hermeneutics and thus documents most of all a discord in the practical and
theoretical formulae of intervention, in the various recipes and in the interpretative

12

gestures. All these interpretations and views constitute diverse and ultimately incongruous
attempts at explanations for those semiotic events that stand in the centre of modern
financial economics. Several layers and aspects of the same eventfulness are claimed
through them, as well as differing, partially conflicting and partially overlapping ideas
about the coherence of the economic world. What is at stake here is no less than the
consistency, i.e. the validity of the world of financial economics. With regard to the
question of what an event on the financial market was, what forms it takes on, for what
reasons it happens and how it coalesces with others on the axis of time; and with regard
to the questions of which reality is reflected in the play of price signals, which forces
induce the trends and booms and the rare events and crises on modern financial markets,
a controversy apparently dramatises itself and lastly, points to a manifest insolubility of
these questions. These are therefore points of discussion within the faculty of economics.
Whether or not the history of listings can offer lessons for future stock performance and
investments; whether and how price fluctuations relate to fundamental economic data
and the circumstances in the rest of the world; whether and in what manner a fictitious
game of signs has detached itself from a so-called real economy; whether the fluctuations
on financial markets occur with regularity or purely randomly; how motivated or
causelessly payment events follow one another; whether financial matters function
efficiently or shambolically or both efficiently and shambolically at once; whether the
dynamics of the markets present rational interactions or manifests of sheer unreason
these questions make the models and hypotheses of financial economy appear as
programmes of action which in view to the economic world proceed as much historically
as they do prognostically, but which do not document a consensus about what it is that
holds that world together at its core. Together they lead into the field of a dark and
confused empiricism. They point to an uncertainty about what a political reality is in the
first place and make room for a number of disappointments. In no other field of empirical
inquiry, the economist Wassily Leontief noted for instance, has so massive and
sophisticated statistical machinery been used with such indifferent results. 17 The enigma of
particular situations, rare events and Black Swans remains.
A problem figure relating to the puzzling picture of a critical mass of events is situated in
the vanishing point of financial knowledge and therein must again and again make out a
precarious indistinguishability between rationality and irrationality, chaos and order,
between a foreseeable course of the world and an unleashed contingency. But
questions, exegetic efforts and controversies of this sort weigh all the more heavily as they

13

concern themselves not least with the validity of liberal economys singular old and
indestructible belief, namely the belief that the market situation were an exemplary scene
of order, integration mechanisms, balance, sensible allocations and thus of social
rationality, and as a whole appeals to a coherent, systematic form of depiction. For that
reason, it may seem justified to recognise a recurrence of certain problematic issues in the
centre of these debates and in the discursive passe-partout of crises of financial
economics, which only earlier attempts at theodicy had to confront in a similarly
systematic manner. For if capitalist economy has become fate, and if expected profit and
economic growth are part of a hope for a remainder of earthly providence, then even
modern finance theory cannot escape the puzzle of whether and how seeming
irregularities and anomalies fit in with a rational set-up of their system, which events can
occur together with others and therefore seem compossible, whether, how and which
rules articulate themselves therein and how the existing economic world can be the best
of all possible ones.
The questions applied by Kant to test the defensibility of attempts at a theodicy should
analogically also be asked from the justifications of a financial economics system. It would
have to be proven that Zweckwidrigkeiten [what we deem contrary] and the apparent
dysfunctions are not such; or that they have to be considered not as facts, but as

unvermeidliche Folge aus der Natur der Dinge [inevitable consequence of the nature of
things], that they have to be accepted as effects of an altogether pleasant world order;
or that they in the end are to be attributed only to the decrepit Weltwesen [mundane
beings], to the lacking care of unreliable teammates.18 Consequently, the appropriate
questions have to be: Are the irrational exuberances really exceptions or are they not
rather regular processes in the works of capitalist economies? Is the distinction between
rational and irrational even sufficient to grasp the effects of this system? Does one really
only deal with the limited insight of financial actors? Or is it not rather that economic
rationality directly encounters its own irrationality here? Does there exist an organised
design or is there merely an unsystematic aggregation of scattered individual action?
Does the system really work rationally and efficiently? And is there a plausible narrative of
financial economy?
Just as the earthquake of Lisbon in the year 1755 once unsettled the fundamentals of
modern theodicy, today, and especially in view of the financial quakes of the last two
decades, the scientific format of economic knowledge is at stake. This is about no less
than the validity, the possibility and the defensibility of a liberal or capitalist Oikodizee

14

[ecodicy]: the question about the consistency of those economic doctrines, according to
which the contrarieties, evils and mishaps within the system seem reconcilable with its wise
composition - or not.

Translated by Eva Louise Behrendt

15

This text is the preface and the first chapter of Vogl's Das Gespenst des Kapitals. (The
Spectre of Capital). Berlin/Zrich: diaphanes 2010.
Copyright by diaphanes, Berlin and Zrich, www.diaphanes.de

New York Magazine of Contemporary Art and Theory in collaboration with Alwin Franke
would like to thank Joseph Vogl, Eva Louise Behrendt, and diaphanes
Jan Van Woensel (founder & editor-in-chief), Alwin Franke (editor)
www.ny-magazine.org, editor@ny-magazine.org

16

9
10

11

12
13

14

15
16

Don DeLillo, Cosmopolis (2003; New York: Scribner, 2004). (All subsequent citations from
Cosmopolis are indicated in the text by their page number); Honor de Balzac, Das Bankhaus
Nucingen, in: Das Bankhaus Nucingen. Erzhlungen (Zrich: Diogenes, 1977) 8; Balzac,
Gobseck, Bankhaus 147. Translation mine; Karl Marx, Das Kapital, Bd. 3, in: MEW, Bd. 15 (Berlin:
Dietz Verlag, 1956) 505; Edward Chancellor, Devil Take the Hindmost: A History of Financial
Speculation (New York: Plume, 2000) 262, 265; NRW-Wahl und Euro-Krise: Mutti Merkel als
Trmmerfrau, Sddeutsche Zeitung 11 May 2010:3. cf. also David Cowart, Anxieties of
Obsolescence: DeLillos Cosmopolis, The Holodeck in the Garden: Science and Technology in
Contemporary American Fiction, eds. Peter Freese, Charles B. Harris (Normal/ IL: Dalkey Archive
Press, 2004) 179-191; Nick Heffernan, Money Is Talking to Itself: Finance Capitalism in the Fiction
of Don DeLillo from Players to Cosmopolis, Critical Engagements: A Journal of Theory and
Criticism 1/1 (2007): 53-78; Per Serritslev Petersen, Don DeLillos Cosmopolis and the Dialectics of
Complexity and Simplicity in Postmodern American Philosophy and Culture, American Studies
in Scandinavia 37/2 (2005): 70-84; Jerry A. Varsava, The Saturated Self: Don DeLillo on the
Problem of Rogue- Capitalism, Contemporary Literature 46/1 (2005):78-107.
Karl Marx, Friedrich Engels, Das Manifest der Kommunistischen Partei, in: MEW, Bd. 4 (Berlin: Dietz
Verlag, 1956) 458-493; Joseph Schumpeter, Kapitalismus, Sozialismus und Demokratie, 6th ed.,
(Tbingen: Mohr Siebeck, 1956) 136-138; Jean Baudrillard, Der symbolische Tausch und der Tod
(Mnchen: Matthes und Seitz, 1991) 15-68; Luc Boltanski, Eve Chiapello, Der neue Geist des
Kapitalismus (Konstanz: UVK, 2003) 39,79ff., 404ff; Jeremy Rifkin, The Age of Access: The New
Culture of Hypercapitalism, Where All of Life Is a Paid-For Experience (New York: Tarcher/
Putnam, 2000) 30-55.
Mark Duckenfield, Stefan Altorfer, Benedikt Koehler, eds. History of Financial Disasters, 1763
1995, vol. 3 (London: Pickering and Chatto, 2006) 276-277.
Georg Wilhelm Friedrich Hegel, Vorlesungen ber sthetik III, in: Werke, Bd. 15 (Frankfurt am
Main: Suhrkamp, 1970) 340-341, 364, 378, 384. Translated version cited: Georg Wilhelm Friedrich
Hegel, The Philosophy of Fine Art, vol. IV, trans. F.B.P. Osmaston, (London: G. Bell & Sons Ltd, 1920)
171.
DeLillo, Cosmopolis 56, 152, 192. For a psychiatric taxonomy of amok, hwa-byung and susto see
American Psychiatric Association, Appendix I: Outline for Cultural Formulation and Glossary of
Culture-Bound Syndromes, Diagnostic and Statistical Manual of Mental Disorders (DSM-IV- TR),
4th ed., (Washington, DC: American Psychiatric Association, 2000) 897-904.
Joel Kurtzman, The Death of Money: How the Electronic Economy Has Destabilized the World's
Markets and Created Financial Chaos (New York: Simon and Schuster, 1993) 17; Rifkin, Access
51.
According to Wall Street trader and financial mathematician Nassim Nicholas Taleb, Fooled by
Randomness: The Hidden Role of Chance in Life and in the Markets (London: Penguin, 2007) 109.
Nassim Nicholas Taleb, The Black Swan: The Impact of the Highly Improbable (New York:
Random House, 2007) xvii-xviii.
Jaques Attali, La Crise, et aprs? (Paris: Fayard, 2009) 53.
Alan Greenspan, qtd. in Justin Fox, The Myth of the Rational Market: A History of Risk, Reward,
and Delusion on Wall Street (New York: Harper Business, 2009) xi-xii.
After the crash of 1987, it was calculated that in a world in which prices fluctuate according to a
statistically normal distribution, this event would have had to have an occurrence probability of
10 -106 ; investors therefore could anticipate it to take place once every couple of billion billions
years, Fox, Myth 231. See also Paul Krugman, The Accidental Theorist: and Other Dispatches
from the Dismal Science (New York: Norton, 1998) 158; Robert Brenner, Boom & Bubble. Die USA
in der Weltwirtschaft (Hamburg: Vsa, 2003) 308.
cf. Paul Krugman, How Did Economists Get It So Wrong? New York Times 2 Sep. 2009.
Daniel Defoe, The Anatomy of Exchange Alley (1719), Political and Economic Writings of
Daniel Defoe, vol. 6: Finance, ed. John McVeagh (London: Pickering and Chatto, 2000) 129-156;
Charles MacKay, Extraordinary Popular Delusions, and the Madness of Crowds (1841/1852)
(London: Harmony Books, 1980); Robert J. Schiller, Irrational Exuberance, 2nd ed. (Princeton:
Princeton UP, 2005). See also Urs Stheli, Spektakulre Spekulationen. Das Populre der
konomie (Frankfurt am Main: Suhrkamp, 2007).
M.F.M. Osborne, The Stockmarket and Finance from a Physicists Viewpoint, vol. 1: Market
Making and Random Walks in Security Data (Minneapolis: Crossgar, 1977) 4, 22, passim.
Michael Henochsberg, La place du March. Essai. (Paris: Denol, 2001) 212-215.
Robert B. Edwards, John Magee, Technical Analysis of Stock Trends (1947), 9th ed. (Springfield:

17

18

Amacom, 1961) 1-11; Fox, Myth 68; John J. Murphy, Intermarket Technical Analysis: Trading
Strategies for the Global Stock, Bond, Commodity, and Currency Markets (New York: John Wiley,
1991) 39, 275ff.; Friedrich Nagler, Timing-Probleme am Aktienmarkt: Ein Vergleich von Strategien
der Random Walk Hypothese, der Formelanlageplanung und der technischen Aktienanalyse
(Kln: Wison, 1979) 25ff.
Wassily Leontief, qtd. in Benot B. Mandelbrot/ Richard L. Hudson, The (Mis)Behavior of Markets: A
Fractal View of Risk, Ruin, and Reward (New York: Basic Books, 2004) 275; Jeremy Rifkin, The Age
of Access: The New Culture of Hypercapitalism, Where All of Life Is a Paid-For Experience (New
York: Tarcher/ Putnam, 2000) 36.
Immanuel Kant, ber das Milingen aller philosophischen Versuche in der Theodizee, Werke,
hg. v. Wilhelm Weischedel, Wiesbaden 1964ff., Bd. 6, 105. Translated version cited: Immanuel
Kant: An Inquiry Critical and Metaphysical into the Grounds of Proof for the Existence of God,
and into the Theodicy, Metaphysical Works of the Celebrated Immanuel Kant , trans. John
Richardson (London, 1836) 160.