THE DISCURSIVITY OF FINANCECritical to understanding the cultural geographies
of finance is a recognition of interpretive power
struggles, where different sets of scripts and
discourses conjure up different economic worlds.
This is clearly evident in social scientific academic
accounts of financial phenomena (see Leyshon
and Tickell’s 1994 unpacking of alternative
historical geographies and political economies of
the post-Second World War financial order). It is
also apparent in the ways in which economists’
analyses spill over into the object of their study:
economists are not some neutral arbiters or
dispassionate modellers of the system. Just as
economists in general have framed and trans-
formed both the analysisof the economy and its
real mechanisms (for example, Callon, 1998;
McCloskey, 1985),^8 so too have they altered the
terrain of contemporary financial markets.
Economic theories and practices have trans-
formed the derivatives markets (Bernstein,
1993), and the events at Long Term Capital
Management (LTCM) in 1998 provide a perfect
illustration of the interrelationship between the
framers of financial architectures and the archi-
tecture itself. LTCM was set up as a hedge fund
that exploited marginal differences in prices in
different financial markets with an aggressive
use of leverage (or borrowed money). During
August 1998, companies trading with LTCM
took fright after Russia announced a partial
default of some of its debts, precipitating a run
on LTCM and fears that the integrity of the
global financial system would be undermined
(see, for example, de Goede, 2001; President’s
Working Group on Financial Markets, 1999).
Much of the mainstream commentary on the col-
lapse of LTCM emphasized that the company
had been founded by two of the three Nobel
economists who had devised the original pricing
model for derivatives, suggesting that economists
should refrain from engaging with the practices
they describe. However, MacKenzie’s analysis
shows that the relationship between finance and
finance theory is an evolving and codetermining
one:The dominant tendency, over the last thirty years, of ...
the ‘financial innovation spiral’ has been to increase the
truth of finance theory’s typical assumptions ...
LTCM’s fate has provoked some anti-intellectual non-
sense. Mathematical finance is part of the modern
world. The techniques developed out of the research of
Black, Scholes and Merton continue to work perfectly
well in millions of transactions daily, and their aban-
donment would be unthinkable folly. Yet we must also
remember that finance theory describes not a state ofnature but a world of human activity, of beliefs and of
institutions. Markets, despite their thing-like character,
their global reach, and their huge volumes, remain
social constructs, and the feedback loops that constitute
them are intricate, knotted and still far from completely
understood. (2000: 1, 5)Finance, then, has the capacity to act upon
discursive constructs with a speed and efficacy
that academics find it difficult to comprehend.
An intriguing and sophisticated account of the
interplay between the cultures, economics and
spaces of finance is found in Anna Tsing’s
(1999) exploration of the events surrounding
Bre-X. This was a Canadian gold mining
company that claimed to have found significant
deposits of gold in a ‘new’ area of Indonesia. The
‘discovery’ had a series of major impacts: the
destruction of protected forests; claims and coun-
terclaims as to whom the land on which the dis-
covery was found actually belonged; corrupt
relationships with government officials; and
soaring share values for the company (which
rose from 51 Canadian cents in 1993 to C$286.5
by May 1996). By early 1997 the company’s
geologist had mysteriously fallen from a
helicopter (his body was never found, and it was
never clear whether the fall was an accident,
suicide or murder) and the company’s gold dis-
covery was shown to be illusory. Tsing shows
how this story allows us to expose a series of
projects embedded within the discourses of
global finance (see also de Goede, 2001; Tickell,
2000a). While many understandings of finance
are that it has become detached from the material
world (money moves instantaneously as bits of
information) and from geographic space (finance
is globalized, trading occurs ‘around the clock’),
Tsing argues that these undervalue the complex-
ity of what is going on. On the one hand, the
apparent disjuncture between money as sign and
the ‘real’ world of money is a reflection of a
‘conjuring aspect’ of finance, which makes
things appear to be real. On the other, finance is
both performative and discursive in nature:The conjuring aspect of finance interrupts our expecta-
tions that finance can and has spread everywhere, for it
can only spread as far as its own magic. In its dramatic
performances, circulating finance reveals itself as both
empowered and limited by its cultural specificity. Con-
temporary masters of finance claim not only universal
appeal but also a global scale of deployment. What are
we to make of these globalist claims, with their millen-
nial whispers of a more total and hegemonic world-
making than we have ever known? Neither false
ideology nor obvious truth, it seems to me that the
globalist claims of finance are also a kind of conjuring
of a dramatic performance. In these times of heightened124 THE CULTURE OF ECONOMY3029-ch05.qxd 03-10-02 10:31 AM Page 124