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The Edge of Chaos
Sandpiles and Crashes: How Systems Tune Themselves to the Brink
The last essay left a loose end. Markets can sit near a critical edge where small shocks cascade, but critical points are usually finely tuned, so who keeps a market balanced there? The answer, found in a pile of sand, is that nobody does. Some systems walk to the brink on their own, and that is where their crashes come from.
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The Edge of Chaos
Crashes Without a Cause: Markets as Phase Transitions
Big market moves often show up with no news to explain them. A hundred-year-old model of magnets shows why. When people copy each other strongly enough, a market can hold two moods at once, and the smallest nudge tips it from one to the other. We build the model from scratch, with pictures, then turn it on markets.