Complexity

I caught this analogy of blogging to punk rock in the latest issue of Wired and thought it disagreeable and ironically uninsightful enough to pass on to fellow blog readers and bloggers. Double ironically it was written by a blogger who's also produced Natural Born Killers. Here's a bit of the post:

I was chatting with a good friend of mine today who went to high school with Jack Abramoff and remembers him simply as a "weird fat kid" and we got sidetracked onto the subject of blogs and cultural energy in general. We both concurred that the blog world has the feel right now that the punk rock scene of the late 70's had, and for much the same reasons…

We thought punk rock and the energetic counterculture it produced would last for ever, but it didn't. It was over quite quickly. Enjoy the blogs while you can. These are the salad days.

Some bloggers and some conformist styles of blogging might be punk like, but blogs and blogging are nothing at all like the short-lived punk rock movement. Blogs are not a fad like Crocs and cabbage patch kids. Some individual blogs might be faddish, but to say that blogs in general are faddish is like saying that movies, the Internet, magazines, music, paper, books, the printing press, and desktop publishing software are faddish.

The blog is just another way to convey information. What I blog about is not governed by any sort of cultural rules. And while punk rock might not have lasted very long, there's always counter culture. It's just always shifting, flowing, changing and evolving like fashion and popular music. I'm not saying blogs will be around forever. Perhaps they will evolve and go the way of 8-Tracks. More likely the technology will improve so much that we will feel compelled to give the new medium a new name so we can laugh at the antiquated technology we knew as blogs.

But there's massive macro unceasing trend that blogging is a small part of. It's the free flow of information and ideas. For hundreds of years, pretty much for ever, people have sought out ways to convey information and ideas more productively. Telephones, pagers, email, cell phones, Vonage, pony express, the telegraph, Indian runners, smoke signals, CB radios, walkie talkies, shortwave, passing information down The Great Wall of China, the printing press to more quickly duplicate and share information, print-on-demand, the Websites, etc… Blogs are just another piece of all that. People were blogging long before we called it that through newspaper editorials, simple Websites, online communities, and radio talk shows.

I have to stretch a bit to tie this to the markets, but it's this kind of lack of ability to see the true nature of something that often causes us to oversimplify the markets. It's not immediately obvious to us to consider that a stock might be governed by supply and demand for stocks in general just as a commodity usually is. We likewise have difficulty understanding that a commodity can at times carry an intrinsic component in its valuation that has nothing to do with supply and demand and everything with speculation. What makes a rare painting worth what people are willing to pay for it? Not the canvas and paint. The value almost entirely resides in the idea that someone else might want to pay more for it in the future than the present price. Commodities and stocks are also priced this way. The influence of this intrinsic pricing component varies through time. Supply and demand for a commodity can be relatively over time, but the intrinsic component varies with the whims of speculators. Since there has yet to be any good way of measuring this component or forecasting its fluctuations, we often choose to ignore it, preferring to simplify the market down to fundamental information or trying to find patterns in the way prices change. Usually one way or the other, but seldom both.

The tie in is that being able to see the true complexity of what blogging is and its potential, is like being able to see the true nature of the factors that move prices in a market.For a Free Trial to MarketSpectator, Mark's Weekly Newsletter, please visit http://www.marketspectator.com