Of Synthetic Finance: Three Essays of Speculative Materialism
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Synthetic finance revolutionizes materialism such that we can now create wealth in the process of universally distributing it. While financial innovation in global capitalism provided the conditions for the 2008 financial crisis, it has also engineered a set of financial technologies with universal distributive potential.
This book explains this possibility and demonstrates how it can be achieved through the use of rigorous ontological exposition of the radical, nomadic and distributive power of synthetic finance. It also illustrates that Gilles Deleuze is the heterodox political economist who best reveals its profound material capacities.
This book articulates an innovative method for the study of finance, fundamentally revaluates political economy as a discipline and practice, and inaugurates a research project from which derivative methodologies and approaches to critical finance can evolve. Of Synthetic Finance actualizes a new kind of heterodox political economy called speculative materialism, and advocates a radical project of speculative materialist financial engineering.Both of these are predicated on the deployment of the latent, nomadic, monstrous capacities of synthetic finance to create and universally distribute risk and cash flow.
This book is a must read for anyone interested in critical finance, the financial crisis and the future of political economy.
too the spirit of such a project must proceed.10 But even if we are willing to grant that economic properties do not so much eternally ‘belong’ to assets as that they constitute their plastic and decentered essence, how do we reconcile the notion of the liquidity of an asset with now the liquidity of a market, or even the liquidity of funding? Is liquidity now not exclusively, or even at all, a property of assets? And if it is not a property of assets, where then is it when liquidity is what it
risk. But it is also the case that risk is a property that is just as pliable, just as isolable, and just as contingent as is any other property we have thus far considered. It is merely a matter of once again revising our understanding of what precisely materiality is, in order to observe that the risk – and in particular the risk embedded in maturity – which is the principal source of volatility, unpredictability, and so on in generic financial transactions, is now in synthetic finance
Black truly is here in 1970 mapping the progressive fungibility of financial assets. As we have labored to observe throughout, Black presumes that the economic properties of an asset constitute its dynamic and plastic essence, rather than that there is some kind of inherent ‘being’ to an asset, from which its properties derive their nature. In fact, our reader will see that Black is really just unearthing the material consequences of the fungible and contingent character of economic properties,
the generic asset. But let us keep in mind that prior to the exchange of the CDS, neither party to this synthetic exchange need be originally exposed to any risk or cash flow connected to the referent. Ownership-of, or exposure-to, the referent is not a requirement for transacting a synthetic financial exchange – which means that neither the protection seller nor protection buyer need be the obligor, or creditor, in the preexisting generic financial exchange. But to the extent that the protection
senior secured bond of Marx Corp. But this need not have been the case; PB could have just as readily transacted the same swap without owning the debt obligation of the Marx Corp. bond, since the requirement placed by the other two classes of exchange (i.e., classical exchange and generic financial exchange) on the unity of risk and physical possession is altogether dropped from a synthetic financial exchange. That is to say – and importantly – there has still been an acknowledgment of