The critical mass of events endlessly argued over by economists resembles a picture puzzle in which reason and unreason, order and chaos, a foreseeable course of world events and sheer unfettered contingency appear as indistinguishable. Questions, exegetical efforts, and controversies of this kind weigh all the more heavily since they bear on the validity of one of liberal economic theory’s oldest and most deep-seated convictions: the conviction that market activity is an exemplary locus of integration mechanisms, harmonization, appropriate allocation, and hence social rationality, and that it demands to be represented in a coherent, systematic way. That is why it seems justified to identify, at the very heart of these disputes in the explanatory attempts occasioned by financial crises, the reprise of a problematic that only older attempts to establish a theodicy had been compelled to address with comparable [p.16] systematic rigor. Given that the capitalist economy has become our fate, given too our propensity to look to profit and economic growth to satisfy some remnant of the old hope for an earthly Providence, modern financial theory also cannot avoid confronting the baffling question of how, if at all, apparent irregularities and anomalies can exist in a system supposedly based on reason. In Leibniz’s terms: Which events appear to be compatible (and hence “compossible”) with which other events? Are relations between these events law-governed and if so, by which laws? And how can the existing economic world be “the best of all possible worlds”?
In any case, the questions that Kant used to test whether attempts at a theodicy were at all tenable would have to be directed, by analogy, to justifications of the current financial system. Here too it would be necessary to demonstrate that what seem to be “counterpurposive” and dysfunctional conditions are in fact nothing of the sort; or that they should not be judged as brute facts but as the “unavoidable consequence of the nature of things,” as tolerable side effects of a generally satisfactory world order; or that they are to be ascribed, in the end, to the flawed nature of “beings in the world,” the limited foresight of unreliable human actors.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), pp.15-16.
[There is] flagrant disunity as to how one payment incident relates to another and which forces of reason or unreason drive financial activity, provide its dynamics, and motivate its anomalies. This problematic is further complicated by the question of what the play of economic signs actually refers to. In other words, what do movements on the share market indicate? How are price fluctuations on stock exchanges and financial markets to be read and interpreted? What do they have the power to represent?
This semiotic question in turns suggests a peculiar ambiguity in finance economics. On the one hand, “fundamental analysis” concentrates on comparing price movements on financial markets with basal economic data: with factors like productivity, returns, cost structures, forecast dividends, discount rates, current accounts, or purchasing power. [p.13] Such factors provide a well-founded reference point for semiotic events and a realistic or objective orientation point for pricing. From this more or less classical perspective, finance price and stock market quotations hover in the long term around the intrinsic value of companies or even whole national economies. Market trends and cycles would in this view be merely the more or less direct expression a mute economic reality, which will ultimately assert itself thanks to its true and real underlying value. […] A substantial frame of reference can thus be glimpsed beneath the fluctuations on currency and stock markets, with their shifting indices and quotations, and sufficient grounds for them can be found in the fundamental economic data.
On the other hand, the common practice of “technical analysis” operates with a form of observation that strictly disregards these referential dimensions. This is the mantic art practiced by banking and stock exchange personnel who, duly initiated into the mysteries of operations research and computational finance, glean prognostic clues for short-term investment decisions from the charts alone, that is, from their analysis of price movement characteristics. […] Better than all other data — the intrinsic or nominal value of shares, for example — these patterns supposedly reflect the true state of the market; they suggest the shape of things to come and confirm the expressive power of graphs to uncover hidden rhythms in the fluctuations of share market and currency transactions.
Joseph Vogl, The Specter of Capital (Stanford: Stanford University Press, 2015), pp.12-13.