Thursday, April 25, 2024

"Capitalizing Truth: Pragmatism and the Logics of Capital"

We've looked at the definition and etymology of speculation a few times, more after the jump.

In the meantime, here, coming in at a different angle of attack, the blog of The Journal of the History of Ideas:

In the winter of 1891, a young John Dewey published an article in a student newspaper at the University of Michigan, where he had just begun to teach. The article, a response to what Dewey felt was a regrettable trend toward obscurantism in philosophers’ writings about truth, was titled “The Scholastic and the Speculator.” Dewey proposed a division between two ways of knowing what is true. The first way was to find a real quality of the world—a fact, or equally a moral principle—and pluck it from its context to lend it an air of universality. This was the “Scholastic’s” method. It involved “taking a thing out of relations and keeping it out” (151). “Not to put too fine a point on it,” Dewey continued, but “the Scholastic was an embezzler.” He “sav[ed] and stor[ed]” without ever giving back. Yet “this abstraction, this saving cannot be all there is to the matter,” Dewey insisted. “These must have some end, some use. What is it?” (152).

The answer came with the second way of getting at truth. “Intelligence must throw its fund out again into the stress of life,” wrote Dewey. “It must venture its savings against the pressure of facts” (152). This was the method of the Speculator, whose procedures Dewey elaborated with an extended economic metaphor:

Every judgment a man passes on life is perforce, his ‘I bet,’ his speculation. So much of his saved capital of truth he invests in the judgment: ‘The state of things is thus and so.’ The current of fact sweeps in this judgment and returns it to him with interest. His guess, his venture has won: the logicians call it verification. Or the stream of fact carries away his investment and he never sees it again. His speculation was against the set of the market and he has lost. (154)

Dewey’s economy of truth was financial. Truths were never fixed. They were contingent social creations that gained (or lost) their value over time and through their reception in the ever-changing “stream of fact.” This fluctuation of value and the uncertainty it generated were inevitable—and, what is more intriguing, they were necessary for the generation and discovery of future truths. The speculator did not know if his beliefs would make it out there in the world. Without that risk, the entire process of speculation would make no sense. Uncertainty was a happy precondition of those investments, those wagers, which brought new truths into being.

And yet if Dewey’s metaphor nodded to the productive capacities of finance, it also struck a note of caution. Healthy speculation had its limits. “There is a speculation which exists just for the sake of the speculation,” Dewey cautioned (154). The key was to remain an investor who stakes his individual funds for a social end. This, Dewey concluded, was the proper kind of truth-seeker: one who “both saves and spends, yet neither embezzles nor gambles” (154). To a striking degree, Dewey’s vision presages the model form of investment that John Maynard Keynes would lay out many decades later in his General Theory. For capitalism to work, Keynes argued, capitalists must not speculate wildly and must not hoard their money under the bed—two forms of equally destructive liquidity fetish. Instead, they must use their liquidity toward long-term, productive investments. As with capital for Keynes, so with truth for Dewey....


From February 2, 2009—remember February 2009, it was in all the papers, Great Recession about to end, but not quite yet, 50%+ decline in the S&P 500 with one last out-the-door whack on the longs about to commence. Good times:

Where in the Bear are We?
Our two guiding principles right now, are:

Anything past settlement date is long term.
Anything long term is terminal....


....One etymology of the word speculation:

c.1374, "contemplation, consideration," from O.Fr. speculation, from L.L. speculationem (nom. speculatio) "contemplation, observation," from L. speculatus, pp. of speculari "observe," from specere "to look at, view" (see scope (1)). Disparaging sense of "mere conjecture" is recorded from 1575. Meaning "buying and selling in search of profit from rise and fall of market value" is recorded from 1774; short form spec is attested from 1794. Speculator in the financial sense is first recorded 1778. Speculate is a 1599 back-formation.
That is not the etymology grandmother taught me. Hers had to do with Italian merchants keeping watchtowers manned to spot sails over the horizon, enabling those who could see furthest to sell off inventory before goods-ladened ships made harbor and crashed the market. More like this etymology at Wictionary:
From Latin speculātus, past participle of speculor (look out), from specula (watchtower), from specio (look at)
Either way, the current market does not lend itself to either contemplation or seeing over the horizon....