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Saturday, August 24, 2013
Economic Collapse – A Black Hole Syndrome
Economic Collapse –A Black Hole Syndrome By Dejenie Alemayehu Lakew
Mathematics justifies that
greed and extreme selfishness: causes economic collapse of societies.
Any system that is established from
relations between different groups in the system and the forces created
there off, continues to exist if the relations remain fair and forces that are
created from the relations remain on balance and valid to all parts. When one
of the forces dominate to the extent of diminishing the strength or eliminating powers
of others, then only a force of pulling towards the dominant group remains and
that leads to the collapse of the system.
I have few examples to validate this fact.
Example 1. Black hole -
galactic giant star that loses it’s force of balance against it’s own gravity.
The only force left that acts on it, is
its own gravity and the forces of pulling outward that emanate from itself and from
its surroundings that keep the balance of forces, in order the structure ( star) to exist, disappear due to its immense weight. The star
then collapses to either a mini size star or ultimately goes to its demise to a formation of a dark matter
of infinite density called a black hole where nothing escapes from it, and everythingaround sucked and devoured including light. Therefore the shining star
of a galaxy disappears from its starhood existence due to imbalance of forces
that holds it.
Example 2. Preys – predators in an ecosystem. We create an
ecosystem of the following things: grass, rabbits and foxes. Rabbits eat grass
and foxes consume rabbits and therefore rabbits are preys to foxes and foxes
are predators on rabbits. We can write mathematical models that studies this
system and consider different scenarios Their continuous co-existence is guaranteed only if they keep their desires in balance and greed in control. That
is, the rabbits should not eat all the grasses available and run out of food
and there by endanger their existence and threatens the existence of the foxes as well
since foxes consume rabbits. Similarly if the foxes get extremely greedy and
selfish and eat all the rabbits in certain time interval, then that is again a recipe for destruction of foxes as they will not have any thing to eat after
sometime as no rabbits left to live, reproduce and multiply. Therefore, greed
and extreme selfishness of the predators lead to the destruction of the vibrant
ecosystem of the two living species.
A mathematical model called Lotka-
Volterra of differential equations studies such relations and some other
similar systems in which species compete for resources, living areas, etc. or
others cooperate and live together creating a vibrant system that works for all
involved. But in the prey – predator model, the extreme case scenarios are that when foxes
are increasing in huge amounts and eat more rabbits, then the rabbits number decreases considerably to the point of disappearance. But there is always a perfect
condition in which the two species live together indefinitely, by keeping
selfish desires in check and live for ever or be greedy and extreme selfish but
disappear together for ever.
3. Economic systems - systems formed from fiscal relations between
different sectors of a human society. In such systems, there are groups called
consumers that purchase services products and utilities and companies that
produces them, and the the fiscal/financial
relations created between them should indeed be healthy, honest, fair, ethical
and above all humane so that the economic relations formed and the forces of
the financial transactions created, stay on balance and remain valid for all
participants so that the economic structure created exists indefinitely.
Here we can look at two kinds of relations that are prevalent in such
(I) Type I : Relations within
companies or intra companies in which companies compete to get more markets and more customers
– their relations can be considered as competition to annihilate, in which the
existence of one is a treat to the growth and welfare of the other and
therefore working hard and playing any tricks to eliminate
the other is the motto of the game. Here is what capital theorists call it monopoly comes
(II) Type II : Relations between the
populus or majority consumers and companies – this relation is similar to the
prey - predator model in which companies play as predators while the majority
consumers as preys – they need each other but for wrong goals, from each sides
perspective. However, the economic relations created between these two groups,
consumers and companies, should again be healthy, fair, truthful or honest and
above all ethical and humane. If companies develop extreme greed and selfish
trends, losing sights of connecting to their consumers as their humane benefit
partners, and completely disregarding the difficulty of financial resources and
fiscals troubles of working people, taking an imaginable and unreasonable
amount of profits from these consumers, then a black holesyndrome will be
created between these two partners of the economy, which eventually lead to the
collapse of the economic system they created.
Case in point: The demise of real estate in America – real estate companies
and banks related to real estate business that offer loans for home buyers, were blinded by extreme profit making to an
unbearable height, wiping out the financialcapabilities of their customers to
the point of being unable to pay their
timely bills, resulted in the abandoning
of homes by huge numbers and led to the complete collapse of the real estate business itself and bankings associated with it. The actual mathematical
justification here is very trivial. If a company uses a profit maximizing
function in which the inputs are from variables that are available based on the
input-response systems of the state of the economy, then trivially, one or more
of the inputs were put falsified, such as the capability of the consumers to sustain paying bills, while their income was dwindling by the day. Thus, the
calculations lack honesty, not being
truthful and therefore violates few of the fundamental rules of credit – trust
and the ethics of reporting facts
This again is a an example of a system that loses its stability by loosing
the forces of balance and fairness that
form the system and thereby creates its own destruction.
Lesson learnt: Although we do not have control over things that exist
outside of our power, such as stars changed to black holes, but we can avoid catastrophes on things we humans created to serve our selves and can have a
control over and make them function properly as needed in a robust way and make
them exist indefinitely. This is possible by keeping the forces that form the
system in balance and making human transactions ethical, fair, honest and
Conclusion: In relational
existence, such as an economy, or other social matters, the innate behavior of species to damage self
to the welfare of others called altruism/selfless
is a very remote possible antithesis of
what is termed as selfishness/extreme
greed - benefiting self on the welfare of others. But between the two extremes,
selfless and selfishness, there is a golden mean – virtues of cooperation to the welfare of all and
even in some sense of positive competition
for betterment and growth, as long as the games are played by ethics and correct
rules, following principles of trust, honesty and responsibility, so that the
forces involved remain operational, valid and on balance so that all parties involved
remain partners of the process/system
and the system continues to exist indefinitely – with no black hole syndrome.
 Rees M.
J., Volonteri M. Massive black holes: Formation and Evolution (2007).
 Dennis G.
Zill, A First Course in Differential Equations with Modeling Applications, 9th
 Fehr E.,
Fischbacher U., The Nature of Human Altruism, Nature 425 (2003).
 Axelrod R.
and Hamilton W D., The Evolution of Cooperation, Science 1981.