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Mitch SMith


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Should we trust the invisible hand?

James B Glattfelder outlines an emergent entity in his study of transnational company data.

Is this entity trustworthy?

Please state your reasons for trust or otherwise on the assumption that this emergent entity exists.

I'd also be interested in your opinion of whether the entity outlined in the math is essentially separate from the people who created it?


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  • Feb 16 2013: Adam Smith's Invisible hand is one aspect of the natural side of macroeconomics. The alternative is for a brave new world type of socialism to take over. Without the ability to compete for business we would be forced to purchace and consume only what the associated badly organized and run kind of totalitarian state might be able to offer.

    In fact the implied theorem of Adam Smith (with this hand, is that it is the most efficient way for the macroeconomy to function) is when the power of competition enables everyone to retain his/her right to choose. Thus we seem to have very little choice but to accept this invisible hand in our affairs unless there are drastic changes which have already been seen both in literature (brave new world, 1984, animal farm, atlas shrugged) and in practice (the fall of comunism in the USSR, the failure of kibbutz society to be economical) for us to come to any other conclusion.
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      Feb 17 2013: Hi David,

      Many thanks!

      Here is where I want to go.

      For my part I will offer that Stalanism is not socialism.

      Personally, I question the principle of competition - things were never that simple. It has a place, but reciprocity is not the only force of community. There is also communality and dominance. These are not clearly articulated by the reciprocal free market moderated by currency.

      I also have problems with currency - i tis, as the name suggests, the measure of current value. It assumes that stored surplus in the form of savings is invested in the trust of future surplus - but I observe that the inherent risk in trust drives hedging behaviours that are not risk mittigation, but risk displacement (aka - ponzi schemes). And that the institutionalisation of usury results in the concentrations of wealth identified by Glattfelder.

      Please be careful to resist political descriptions of systems - the most productive socialist community on planet Earth is the USA - has been since the founding fathers.

      (Edit: I think that Smith's work has been skewed by media somewhat - he was not talking about competition in the sense of dominance, but in the sense of reciprocity .. thanks very much! I think we have identified the infection in the hand! Currency does not operate on dominance - it operates on reciprocity - exactly like evolution! So who has injected this infection? I would look to the ponzi schemers - insurance - and to the usurers - central banks. Next .. the math .. but nt quite yet - there is another dros to pull from the forge: there is a BIG difference between dominance and leadership - consider the Greek Democracy - leaders were nominated and had to be forced onto the throne reluctantly)

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