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As the financial crisis fastens its grip ever tighter around the means of human and natural survival, the age of the algorithm has hit full stride. This phase-shift has been a long time coming of course, and was undoubtedly as much a cause of the crisis as its effect, with self-propelling algorithmic power replacing human labour and judgement and creating event fields far below the threshold of human perception and responsiveness. But, as the articles in this issue by Alberto Toscano, Bogdan Dragos & Inigo Wilkins, and Benedict Seymour relate, the adoption of algorithmic tools begun by financial traders in the 1990s has expanded exponentially since 2008 in response to the intensified profits crisis as much as the maturation of tools. Toscano [p. 68] soberingly illustrates the effects of this shift: ‘In 1945, US stock was held on average for four years; this dropped to eight months in 2000, two months in 2008, and 22 seconds in 2011.’ So algorithms are widely experienced as the replicant horsemen of the apocalypse, swarming through and clogging up markets in their pursuit of tradeable differentials, creating an endless churn of shares which foreclose longer term investment strategies, dangerously automating the assessment of risk and precipitating ‘flash crashes’, hitting labour markets as supply chain management systems react at light-speed to human or material frictions, sucking up huge financial and energy resources to construct the data infrastructures they require, and even creating tens of thousands of unemployed traders as this elite profession falls victim to its own drive towards efficiency.
But our enslavement to the algorithm has as much to do with our conceptions of it as our replacement by it or, better, the capitalist nature of this replacement. Toscano references a literature of ‘materialist micro-sociology’ which opens up the black-box of high frequency trading (HFT) to grasp it as a product of ‘institutional struggles’ over the fixing of legal and technical parameters, and not just the cognitively unmappable computational acceleration and automation of mathematics. In his short story [p.94], Seymour imagines a non-capitalist use of algorithms which are simply given a different aim – to solve mankind’s dependency on the value form and hydro-carbons, nix climate change and improve the sum of human happiness – thereby recentering the human and ‘enslaving’ the algorithm to the needs of mortals. Dragos & Wilkins [p.80] highlight a different finality to HFT than the chaos inducing repetition compulsion of the algorithm itself, namely that of high entropy and noise saturation peaks. As with all isolated systems, they argue, the market is ruled by the second law of thermodynamics which states that entropy will tend towards a maximum.
HFT’s attempts to eradicate information differentials (e.g. bid-ask spreads) end up offsetting more noise/entropy onto the system as a whole, as it ‘browns out’ the networks with price requests and the sub-millisecond turnover of trades. If the first two writers stress the algorithm’s operation within the logic of capitalism, one which as Marxists they also understand as both an effect and imprisonment of the human development of reason, Dragos & Wilkins widen the focus to think about how HFT is also determined by natural and physical forces; how capitalism precipitates high entropy. While none of these analyses understand algorithmic behaviour as strictly ‘out of control’, they do nevertheless diverge around the contextual frame in which its autonomising force can be understood. For Toscano and Seymour, algorithms exist within a human driven techno-social development which has unleashed the autonomising power of exchange value. For Dragos & Wilkins, the human evolves as much within the ontological sway of technology – amongst other physical, chemical and biological processes – as vice versa.
The ways in which capital’s will to autonomy meets material limits, and the material realm is reciprocally shaped by the forces of abstraction, is naturally as much a problem for city dwellers, farmers, artists, anti-capitalists and philosophers as capitalists themselves. Returning to Marx, Toscano reminds us that the more production is driven byexchange value and hence exchange, the more the physical conditions of circulation become a problem for capital in its bid to ‘annihilate’ space through time. Similarly, Dragos & Wilkins point out that the (paradoxical, because inimical to profit) pursuit of total efficiency or ‘zero information friction’ results ‘in the non-dialectical destruction of whole swathes of economic actors largely at the base of steep energy gradients’.
This ‘resurgence’ of the physical sees, for instance, finance capital blasting holes through the Allegheny Mountains to lay fibre optic cables to shave sub-millisecond times off trades between Chicago and New York. It also sees the migration of circulating capital into real estate speculation and rent extraction – discussed by Neil Gray in his extended review of David Harvey’s Rebel Cities [p.126] – during capitalism’s long profits crisis from the early ’70s until today. A ‘spatial fix’ which impacts in the material realm of social reproduction, with more or less insubordinate results across the decades. In both scenarios, automatic intensification causes the resurgence of material frictions: the physical terrain that circulating commodities or trades must cross as much as the social and physical densities of cities.
Artists are likewise provoked by the compulsive effects of automation upon the visual realm. John Houck, who has made this issue’s cover and artist’s project, has spoken of his desire to pierce virtual objects and their recursiveness. ‘I wanted to reclaim them and make them physical’, he said in an interview for Lay Flat magazine, ‘[...] To overlay an intuitive system on a combinatorial system was the way out of the dead end of a predictable notational system.’ And in his article on the so-called New Aesthetic – a term given to the involuntarily aesthetic effects arising from networked computational and technological assemblages – Curt Cloninger insists on the aesthetic as residing in the affective responsiveness of humans and not within any notional aesthesis of the inorganic.
The escalating circularity between technological intensification and capitalist omnicrisis has become an oppressive and bewilderingly abstract battleground upon which the question of social survival, aims and values is being fought out. To what degree do we see reasoning and technological systems as autonomous from human determination? Can human society challenge its domination by abstract systems (of value) to create new, non-lethal ones? To what degree are we symbiotically integrated with them? How are they extending the limits of humanness or preventing its necessary development? When John Houck folds the print-out of a software driven index graph, re-photographs it and then adds a digital fold, can we still tell the difference between the two folds? Does the manual act of folding do something more than create a delusional sense of the human empowerment to affect our conditions? Or is exerting force against virtual systems, without fantasising our release from them, something we need to learn to do as elegantly as Houck?
Josephine Berry Slater <email@example.com> is Editor of Mute
Featuring: Manifesto for a Theory of the ‘New Aesthetic’ - An irreverent guided tour of the ‘New Aesthetic’ by Curt Cloninger | The Missing Factory - John Roberts considers why work remains absent from film and culture more generally | Barbara Says – Industry Does it Faster - Roman Vasseur reviews the Artist Placement Group’s historic brokerage of bureaucracy and art | The Ghosts of Participation Past - Josephine Berry Slater reviews Claire Bishop’s recent book, Artificial Hells | Listener As Operator 3 - Howard Slater finds in jazz a response to the experience of slavery which preserves and propels a collective being | Untitled #m001-#m011, 2,325,600 combinations of 16 grays, an artist’s project by John Houck | Gaming the Plumbing | Alberto Toscano inspects the gap between financial fantasies and the muddy realities of the ‘robot phase transition’ | Destructive Destruction? - How is high frequency trading’s drive to efficiency affecting market dynamics as a whole? Ask Inigo Wilkins and Bogdan Dragos | Fellowship of the Wrong - A code-splitting tale of lightspeed trading run by Benedict Seymour, with illustrations by Rona Tunnadine | The Guest - A short story by Mira Mattar exploring the annihilating power of luxury | The Garden of Earthly Delights - Matthew Fuller wades through the Olympic muck to visit The Crystal World | At the Limit: Self-Organisation in Greece - Anna O’Lory of Blaumachen identifies some limits to current struggles in Greece | Whose Rebel City? - Neil Gray discusses David Harvey’s Rebel Cities from the perspective of the autonomous urban struggles of ’70s Italy
Published by Mute Publishing
Print ISBN 978-1-906496-04-3
Also available as eBook ISBN 978-1-906496-91-3