Mar

5

Diagnosing the System, by Stafford Beer (John Wiley & Sons) This books presents an interesting way of looking at organizational structure, but some of the terms could be applied in a financial markets system/context. Here are a few excerpts:

  1. Viable: able to maintain a separate existence
  2. Homeostasis: stability of a system's internal environment, despite the system's having to cope with an unpredictable environment
  3. Invariant: a factor in a complicated situation that is unaffected by all the changes surrounding it
  4. Variety: a measure of complexity: the number of possible states of a system
  5. The Law of Requisite Variety: only variety can absorb variety (Ashby's Law)
  6. Attenuator: a device that reduces variety
  7. Amplifier: a device that increases variety
  8. Transducer: encodes or decodes a message whenever it crosses a system boundary - and therefore needs a different mode of expression
  9. Oscillation: failing to settle down in homeostatic equilibrium, a dynamic system over-corrects itself continuously

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