For a Philosophy of the Market: The Case of Elie Ayache

Jon Roffe (University of Melbourne), Elie Ayache

While censorious moral proclamations and weighty political discourse are readily at hand these days in response to any fluctuation in the global market, we for the most part remain without any intrinsic and philosophical account of the market. Given the market’s ubiquity and influence, this seems more than just a minor lacuna in the philosophical demand to adequately think reality.

One striking exception to this state of affairs, though, is the work of Elie Ayache. In his 2010 work The Blank Swan, and drawing on a range of philosophers including Deleuze, Badiou, Meillassoux and Bergson, Ayache argues that the market is a newly formed and ontologically distinct space, what he calls the “privileged medium of contingency.” For Ayache, market trading, and more specifically the trading of financial instruments called derivatives, are revelatory of the nature of the market as such.

My goal in this paper will be to discuss four points: 1) Ayache’s (Bergsonian) critique of the notion of possibility and his reassessment of the role of predictive modelling in our understanding of the market; 2) the correlative reconceptualisation of the concept of the market as the medium of derivatives (what Ayache comes to call contingent claims); 3) the (Deleuzean) consequences of Ayache’s account of the market; and 4) the potential demise of the market at the hands of automated algorithmic trading (or the replacement of the trader with the mathematician).

Elie Ayache will follow the paper with a response.

Jon Roffe is a Mackenzie Postdoctoral Fellow at the University of Melbourne. He is the author of Badiou’s Deleuze (Acumen 2011) and the forthcoming book of aphorisms Muttering for the Sake of Stars. The founding convenor of the Melbourne School of Continental Philosophy (www.mscp.org.au), he is also an editor of Parrhesia: A Journal of Critical Philosophy (www.parrhesiajournal.org) and the co-editor of a number of books on recent and contemporary French philosophy.

Elie Ayache graduated from Ecole Polytechnique in 1987, traded options in open outcry markets until 1995, co-founded ITO 33, a derivative pricing technology firm, in 1998 and published The Blank Swan: The End of Probability in 2010.

For those interested in Ayache’s work, the following pieces may be of interest:

* Interview on The Blank Swan (http://www.ito33.com/sites/default/files/articles/1005_coverstory.pdf)

* The End of Probability (http://www.ito33.com/sites/default/files/articles/1011_ayache.pdf)