Photo by Towfiqu barbhuiya on Unsplash
 

The foundation of the stock market (1792)—the very reason for its existence—is price discovery under uncertainty; that is, risk/reward. If, hypothetically, uncertainty were to be eliminated, the ‘market’ would devolve into an entirely different structure. Most all would hold that to be an unlikely occurrence as billions are being invested in the technology of algorithmic computation, expecting ginormous profits from corporate share price jumps, as well as the benefits derived from the unique output algorithms provide; that is the estrangement from the uncertainty of decision making. “Being right” is the purpose algorithms are optimized to perform in pursuit of efficiency. To know all there is to know and will be known.

However, there is a price for the comfort of “being right all the time.” That is the willing surrender of the right to be inefficient, wrong, or self-defined, in exchange for guaranteed stability and a transparently managed, frictionless life in stasis. Should the ensuing globalist autocratic technocracy actually succeed, the veritable Stock Market as it has been known would be incompatible with assurances of determined “Algo-Outcomes” and be relegated to a serviceable utility.

The Loss of Friction and the Black-Scholes Model, which underpins modern financial derivatives (like options), assumes a frictionless market—no transaction costs, no restrictions on short selling, and continuous trading. It is a theoretical ideal, but a conceivable technocracy pushes the concept to the extreme, eliminating not just technical friction but epistemic friction -- the friction of not knowing the future.

In current markets, the risk premium—the extra return an investor demands for bearing uncertainty—is the driver of profits. In a hyper-optimized system where the future is highly predictable (a managed outcome), the variance approaches zero (σ→0). Therefore, the risk premium must also approach zero. If there is no reward for risk, capital only flows into assets that guarantee a small, stable return, effectively eliminating speculative investment. Stasis.

Arbitrage opportunities exist because of temporary inefficiencies and information asymmetry (friction). When the computational infrastructure described is complete, all relevant information will be ingested and modeled in real-time, instantly correcting any pricing error. Arbitrage would become instantaneous and reserved only for high-frequency trading algorithms, making it inaccessible and non-profitable for human or slower institutional players.
Theoretically, it be assumed that the Algo would have anticipated the inefficiency and corrected it before it manifested… A Vonnegut for the moment.

Short selling thrives on unanticipated loss—the surprise news, the political shift, the unexpected flaw in a company's business model. If the Algo-Exchange is optimized to eliminate problems and manage political outcomes, the probability of a company suffering a catastrophic, unforeseen loss approaches zero. The algorithms will have already priced in the slow, managed decline or, more likely, orchestrated a managed consolidation or acquisition (no messy bankruptcy). All accomplished in the internal, secretive darkness of data bank processors.

Furthermore, as algorithmic pricing and techo-management become increasingly prevalent, any sudden, aggressive shorting would be immediately flagged as a potential destabilizing variance. The technocracy’s purpose is to maintain predictability, making speculative bets on failure an act of sabotage against the managed outcome.

The market's role as a driver of innovation and conglomeration would fundamentally change: the Algo-Exchange only invests in what the algo-model predicts will work for the interests of the technocracy and its autocrats.

Acquisition, the messy, unpredictable process of hostile takeovers, ego-political maneuvering, and market surprises, becomes an administrative process. If the Algo-Exchange determines that Company A would be X% more efficient as a feature of Company B, the merger is executed as a necessary step for global optimization. In this "flat" market, the Algo-Exchange transforms from a volatile, high-stakes casino into a highly efficient administrative utility. Its function would shift from speculation and risk discovery to passive, utility-style capital allocation. Stasis.

Capital is no longer managed by millions of competing biases but by centralized, highly sophisticated AIgo systems (managed by the auto-technocrats). The goal is not "beating the market" but generating a precise, steady, and pre-calculated social dividend. Risk would be a controlled input, not a variable to be exploited. It would be priced with near-perfect accuracy, eliminating the potential for outsized profit. The price of a stock would no longer reflect speculation about its future, but a near-perfect, real-time reflection of its optimized utility within the managed economic system. But do not mistake the appearance of “evenness” as a precursor to socialism and the wealth and the power it commands will continue to reside with a percentage of the one percenters.

A cynical projection: The demise of friction will be the epitaph written by the algorithmic utopia of certainty.

The cost of comfort and managed outcomes could result in the liquidation of the entire apparatus of financial risk and reward as we have know it. The friction of the market will be gone, replaced by the relentless, digital hum of perfectly executed code. In the frictionless market, capital allocation becomes cold and purely administrative. The reward for risk (σ→0) vanishes. The system is perfectly efficient and stable -- a perfectly preserved, sterile artifact of capitalism, incapable of generating the novel energy required for disruptive growth owing to circumstance and innovation.

Stasis in ancient rhetoric, literally meant a "standstill" or "position," and the process of Stasis Theory was a tool for productive conflict. It was used to find the precise point of disagreement (fact, definition, quality, or policy) so that debate could be focused and rational. Contrarily, technocracy’s goal is to make the decision-making process and you (but not your money) unnecessary.

The techno-trajectory: not a coup, not a formal technocracy, but a gradual displacement of democratic agency by economic–algorithmic gravity that does not rely on conspiracy; it relies on structure.

Power no longer needs to govern to rule -- Historically, autocracy required visible control of institutions. What I am describing is different: If a cohort of firms: control capital flows, intermediate transactions, define optimization criteria, and supply the decision tools themselves, then policy follows feasibility, not ideology. There is no opportunity for dissent as there is no forum to present the contrary or an audience to listem.

This is governance by pre-selection of the possible. Algorithms don’t vote, don’t testify, don’t have standing—but they decide: creditworthiness, insurance risk, employment filtering, pricing, logistics, energy dispatch, and information visibility. When these systems become embedded across sectors representing a third (or more) of GDP, they function as de facto regulatory frameworks, yet: they are proprietary, optimized for efficiency, not legitimacy, and insulated from democratic correction. That is not technocracy in the classical sense—it’s auto-political infrastructure devoid of ethics or morals and the potential to corrupt them as an influence.

The technocrat’s “shadow council” does not need to coordinate as they share incentives, share models, share efficiency metrics, and share dependence by governments and markets and so--produce emergent alignment. The result is what you might call structural oligarchy: not rule by decree, but rule by dependency. Governments become customers; citizens become data exhaust.

Why resistance is futile -- Democracy is slow and deliberative. The “Algo’s” are: fast, opaque, adaptive, and justified by “neutral optimization.” Opposition to the “Algo’s” is framed as: anti-growth, anti-innovation, irresponsible, or simply “outdated” or worse, subversive. This creates a moral inversion: efficiency becomes virtue, and dissent becomes friction. The most subversive element is not control—it’s habituation--people stop asking who chose this, and instead ask how do I adapt. That is where democratic erosion happens—not through repression, but through resignation. Stasis.

More By This Author:

The Auto Market's Unwillingness To Bend: A Looming Economic Catastrophe
Synchronicity: Denying The Unexplainable
Facts Can Still Be Propaganda, When Manipulated