chapter  6
Sources of financial sociability: networks, ecological systems or diligent risk preparedness?
Pages 17

How is financial sociability to be conceived? This chapter outlines several features of the financial system that pose this issue, though initially in a somewhat oblique manner. One of its main arguments is that to understand such sociality requires coming to terms with a controversial claim as regards the financial system: that it demonstrates many irrational properties. Thus a preliminary problem is to explore further the character of this irrationality. This is the task set for the first three main sections in particular, which widen the treatment of this to be found in Chapter 4 and Chapter 5. In the following section I address the relationship between rationality and irrationality as analogously analysed by Carl Schmitt in The Nomos of the Earth (2003 [1950]). Here Schmitt crucially links the nomos of a rational calculative ‘inside’ with an anomic ‘outside’ that is somehow beyond calculation and therefore ‘irrational’ in his terms (see also Chapter 7). Clearly, to sustain the force of any similar argument in the context of the financial system requires specification of exactly what rationality means in both contexts, something examined at the end of the second and third sections of this chapter, which then moves on to examine the history of the term ‘finance’ to point up the particularity of its modern usage: as a verb indicating to the generalized mobilization of creditors and debtors in an arrangement where there is no final redemption of debts. This is the source of financial crises, it is suggested, which, as a consequence, cannot be eliminated from the financial system through better modelling, regulation or management. Crises are endemic so the problem is to come to terms with this ‘irrationality’, something I will pursue later. It is in the fourth section that the issue of financial sociality as such is addressed head on. Here four senses of such sociability are

invoked: it being conceived as a matter of contract, as a matter of interrelatedness, as a matter of habit and repetition, and as a matter of will and passion. And it is this latter sense of sociability that drives much of the irrationality of the financial system, it is suggested.