The "What is Money?" Show

WiM045 - The Vervaeke Series | Episode 2 | Wisdom and the 4 Levels of Knowing

Sep 9, 2021
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INSIGHT

Price as Data Compression in Markets

  • Value is expressed through individual relevance realized by action, which collectively compresses into a price signal in distributed cognition.
  • This price serves as an objective data compression reflecting demand and supply dynamics in the market system.
INSIGHT

Tradeoff in Data Compression

  • Data compression helps generalize and predict but loses nuance, increasing surprise by novelty.
  • Overcompression is useful in stable environments but fails when radical shifts demand refined discrimination.
INSIGHT

Ecologically Embedded Rationality

  • Human cognition is ecologically embedded, not disembedded or purely computational.
  • Rationality is bounded not only by computation but also by biological and environmental context.
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