Introductory reading

Introductory viewing

  • Agoric: How it Works & Economic Logic
  • Randy Martin on Derivative Logic—Derivative logic is something more than just financial technique, it is a new value form… I see ECSA, and what we are now building, exactly like he says here, as a derivative, a risk generating practice, a derivative practice which arbitrages, speculates and leverages about being able to act, together, on a certain gap or an opening or an opportunity. You will get this immediately. A beautiful articulation of derivative practice and its connection to dance by Randy (who recently just passed away). Financial platforms of the future (PDF paper—Program of our London Office (August 2015) where the next steps of Robin Hood were pre-launched, tested and developed. Gives a nice overview of the problematic with which we are working at the moment: is the fusion of blockchain technology and finance going to be just an integration of existing financial industry’s business models and political consequences into blockchain – or is it going to be an invention which enables building of new social architecture of finance. (10 min of your time)
  • Robin Hood – the Documentary Trailer by Mette Reizler
  • Agoric Architecture Overview (Part 1) & Part 2
  • Robin Hood on YouTube—Brian Massumi, Jaromil, Vinay Gupta, Ian Grigg, Robert Meister, Andrea Fumagalli etc. on Robin Hood and the future of finance

The Activist Hedge Fund by Brett Scott Brett Scott, the author of Heretic’s Guide to Global Finance, on why he thinks Robin Hood is so important – and most of all, why Robin Hood is never lame. LINK:

Is it art? Is it a hoax? Hedging precarity and protecting the commonfare A discussion about the future and history of economy and future and history of politics with economic anthropologists Bill Mauer and Taylor Nelms, What is the magic forest that Robin Hood is trying to build? (20 min of your time) LINK:

Democratizing the power of finance. A discussion with Akseli Virtanen A good summary of the first two years of Robin Hood, our starting points and aims, how does the Parasite algorithm work in detail, what is minor asset management, how do we see the relationship between art and politics and economy, what is our ethics, what happened at Kassel Documenta(13), why do we think that Robin Hood is a monster. Probably all the questions we have been asked during the first two years in a concise form (30 min of your time) LINK:

Robin Hood is a new concept by Akseli Virtanen
 A more hard core conceptualization of the problem to which Robin Hood corresponds. How is our subjectivity related to the financialization and precarization, what is semiotic inflation, why do we think that economy has become arbitrary power, and how is it possible to find a way out when there is no way out. (45 min of your time) LINK:

From Arbitrary Power to Morphogenesis by Franco “Bifo” Berardi and Akseli Virtanen Robin Hood is an experiment in the creation of new social and economic forms. Why is this important? What is the new form of power Robin Hood is dealing with? How does the financialized economic power function? How is it possible to control the uncontrollable? How is it possible to govern a system that is too complex to be governed? What is the relationship between our inability to know everything and economy? Many basic premises behind Robin Hood can be found here. (30 min of your time) LINK:

Exhaustion of Possible by Future Art Base A map of the territory where Robin Hood operates. (5 min of your time) LINK:

Power at the end of the economy A discussion between Brian Massumi, Maurizio Lazzarato, Peter Pal Pelbart and Akseli Virtanen about the basic premises of Robin Hood: the end of economy as we used to know it and understanding its new nature, organization and relation to our subjectivity. The question of the future begins from understanding the relationship between the exhaustion of the possible at our disposal and how the production of value functions today. Economy is not anymore a matter of “economics”, it captures and exploits something more profound: the process of singularization and production of new modes of subjectivation based on desire. In Robin Hood Stuttgart Office (June 2014) we were trying think this new situation: How does power work at the end of the economy? What are its means of capturing the future already today? How is machinic surplus value produced? How is singular becoming possible when the mechanisms of accumulation do not restrict themselves only to our actual actions in particular time and space but sink their teeth directly into the molecular, aleatory, the uncertain and indeterminate still in the process of becoming? The concepts developed here – like ontopower, arbitrary power, power signs, machinic enslavement, exhaustion of possible, impossible community – may sound excessive and even extravagant, but they are all mapping the territory on which we already walk. They are thinking very precisely about the nature and organization of “n”, the multitude, and how the power must turn in different ways towards “arbitrariness” and “pure power” (Akseli), or “priming” (Brian), “machinic” (Maurizio), “nihilism” (Peter) after all the “ones” are gone. In this wonderland nothing appears anymore the same. (30 min of your time) LINK:

Robin Hood Athens Laboratory Robin Hood is at the moment taking on a new and more monstrous form. Just like Bitcoin broke the taboo of money and showed that money can be engineered, we are now engineering in similar way more financial instruments. We are developing a series of new P2P financial services that correspond to the needs of new kind of economic operators, precarious workers, makers, co-creators, peers, collaborators, movements –which are often collective– and simply do not have available means of finance that would correspond to what they want to do, and how and when they want to do it. What kind of tools of economic creation would you need? (10 min of your time) LINK:

Welcome to the wild side of finance
 A short discussion made after our Milan Office (May 2015) which introduces some of the next moves of Robin Hood: digitalization of the cooperative, why we are interested in blockchain, what is the Hood Note, what is Robin Hood doing in Milan Universal Expo, and what are the Robin Hood Projects in which we are about to start investing (30 min of your time) LINK:

The Tale of Robin Hood Retold by Tiziana Terranova
 Robin Hood is more poetics than business in any traditional sense. It is rethinking the relation between financialization and social cooperation. It is about subjectivity and its “becoming”. It has implications to understanding how imagination, or learning from things that have not happened yet, can be used to creating new social architectures. Robin Hood is a play in the future, and as a play, it requires the engagement of its members, or “operators”, for making it real. To assess it with rational financial logic is to undervalue its true meaning and potential strategic impact: It is an aesthetic rather than a calculation, and a minor rather than a major enticement to novel thinking and to the creation of new opportunities, even when they are precarious. (10 min of your time) LINK:

Is it possible to use capital against capital? Carlo Vercellone on Robin Hood LINK:

Zero Magic/Sting: shorting target identification algorithm development => we will have the next working session on this later this week. Some specifications attached.

Fuck Basic Income, we want basic equity (with options)

=> How do we shift from individual precarity to collective/transindividual metastability? What is the metramorphic passage from debt- to equity-based economy. This is, in a nutshell, the line of flight out of sedentary finance ECSA is trying to draw.

ICO as a Ritual: Offering an Offer

=>The economic logic of the offer starts from taking seriously the nature of the derivative and the gift, as recently articulated by Appadurai, Lee, LiPuma et al. As these authors observe, the gift is the opening of an interval. The offer, as ECSA conceives it, is an invitation to inhabit that interval and be invested by it. In other words, the offer is not only durational but also possesses a directionality, which is given to it through the movement of the gesture that invites in. Thus the offer is an invitation to participate in that movement too – i.e. in the choreographies of different kinds of currencies and flows of values – and to speculatively engineer a new social kinesthetics (as Randy Martin beautifully puts it), based on the making and sharing of new time, space and relations

Bob Meister on Production Liquidity (attached, this is also in the Derivatives book, which Skye sent you already?)

Dick Bryan on HouseHold Union (attached two chapters of a new book manuscript)

Is it possible to think (and act on) historical justice through financial derivatives? A summary position of Robert Meister’s new work on “Option of Justice”

a. Starting point: financialized capitalism preserves and increases the cumulative value of past injustice without appearing to keep continuing it.

b. We must ask why these cumulative gains should accumulate so largely to the ongoing beneficiaries of past injustice.

c. How to bring this question into politics (that it can’t be done at the moment is one of the biggest problems): The DEMAND FOR JUSTICE can be articulated as an _OPTION ON THE ACCUMULATED WEALTH OF SOCIETY_and not merely as a claim for a more equitable distribution of the income derived from goods and services.

d. To be politically effective we need to understand the forms of hands-on power that could be used collectively to threaten financial dis-accumulation (= asset price collapse) in much the way that the option of a General Strike threatened the dis-accumulation of industrial capital. So, if the Welfare State was the political price exacted for NOT exercising the option of a General Strike, there should also be political price for_ NOT_ exercising the option to bring on a liquidity crisis by collective action aimed to “occupying” (possessing) the forms of collateral that are presently in our control and that financial system literally “counts on” being able to _RE_possess. This includes the collateral for our own debts and also our expected payments which function as collateral for other debts.

e. We can measure now approximately the political price of restoring liquidity: in 2008 the U.S. government preserved the liquidity of global money markets (the Shadow Banking system) by swapping $5-13T of illiquid private debt for U.S. government debt, thereby providing the financial system with a supply of safe collateral.

f. FINANCIALLY, this meant that the general formula for pricing all financial options (Black-Scholes-Merton) had become a technology for manufacturing synthetic public debt (the equivalent of U.S. Treasuries) out of private credit and other forms of capital. So, when these synthetic Treasuries became illiquid, and thus worth less than government obligations, their theoretical equivalence had to be PERFORMED, AND THUS MADE TRUE, by swapping them for real US Treasuries at par in whatever quantities were necessary to stabilize the financial markets.

g. POLITICALLY, this meant that the capitalist state no longer borrows more in order to spend more, as it did in Keynesian capitalism; in austerity capitalism it, rather, spends less so that it could borrow more cheaply. Here, the option of justice is taken off the table (valued at zero) in order to use the state’s debt-creating power to preserve the liquidity of capital markets and, thus, the value of accumulated wealth.

h. Our response to austerity capitalism should think creatively about “liquidity crisis” as the chokepoint of financialized capitalism—threatening to destroy up to 100% of the market value of accumulated wealth. Wasn’t the restoration of liquidity a_ NATIONALIZATION_ of the means of financial production that redirected (and reprivatized) flows of funds and collateral without then SOCIALIZING them?

i. Could we think of a coordinated response – at the level of policy, creative communities and social movements – that uses the techniques of finance to subvert and reverse its own tendency to widen the cumulative effects of past injustice? The point: to exact a political price for ROLLING OVER, rather than exercising, THE OPTION OF JUSTICE.

j. That price should be roughly comparable what the bankers on Wall Street exacted in 2008 when they threatened to blow themselves up along with the global financial system if they could not exchange bad private sector debt for risk-free government obligations at 100 cents on the dollar. If we consider justice as the PUBLIC PRICE of preserving the liquidity of financial assets then the amounts available to finance historical redress are potentially very high.

k. The point: we can consider asset values as a multiple of GDP (Piketty’s approach) that multiple, when leveraged, could be 5x, 7x, 13x, perhaps even 75x larger. There is a basis for choosing any of these multiples and pricing the roll-over of justice accordingly. The point is that the number is very large: THERE’S PLENTY FOR EVERYONE if we treat historical justice as an option.

l. Politics is about keeping the option of justice in play. This has never been more valuable than today. Footnote: about Piketty

Piketty’s attention is on the distinction between asset values (capital market) and revenues (GDP). His point in caricature: asset growth exceeds GDP growth, and the possibility of reversing that is the result of very exceptional circumstances like war, depression etc. So, he sees two different things: asset growth and revenue/income growth. But: he has no theory of asset pricing. Consequence: asset growth is justified only if it keeps pace with the speed of income growth. But, looking from Bob’s perspective, the phenomenon Piketty identifies as “possible” is in fact a constitutive of capitalism. The logic:

  1. The point of creating surplus value is to accumulate it
  2. To accumulate it, you have to preserve it
  3. To preserve it, you have to get something that constitutes a hedge
  4. Previous thinking: the only way to hedge is expansion of your investment in raw materials and fixed capital
  5. This requires increasing production and that is why income growth and asset growth need to be linked
  6. Early1970’s on financial theory engineered a way to manufacture hedges, risk free, in whatever supply is necessary for demand, without going through the production process.
  7. That is why creation of financial products has grown so much faster than the forms of accumulation that require the creation of non-financial products. And that is also why production sphere lost its place as a choking point.

Internal docs