Speculation has always fused an insurance function with gambling on volatility.
Evidence
Historically, speculators have been seen as both insurers of and gamblers on financial systems. On the one hand, they correct misvaluations, taking on risks others avoid and thus preventing markets from overheating, while on the other hand mastering short-selling games and betting on volatility. From Weber’s “unscrupulous speculators” to Marx’s “commodity fetishizers” and Polanyi’s “fictitious value-dealers,” the function of speculative finance as a motor for capitalist dynamics has long fascinated students of capitalism. Pierre-Joseph Proudhon (1857) memorably distinguished between productive speculation (a formidable force driving economic futures, able to “create something from nothing”) and unproductive speculation (the immoral and unjust trading that plays the stock market like a lottery, leading to inequality and exploitation of some classes by others). But at its core, the art of speculating always encompasses an imperfect knowledge of the future and the acceptance of high risk; it combines the Lutheran fatalism of an inexhaustible human desire for accumulation with the ingenuity that Adam Smith believed speculation fosters. — Aris Komporozos-Athanasiou, Speculative Communities, 52
Categorization
- DEFINE: Establishes the twin insurance/gambling identity of speculation that recurs throughout, useful for defining homo speculans.
- XREF: Proudhon’s productive/unproductive split connects to the book’s later assessment of whether counter-speculation reclaims or concedes ground. — connects to: Insurance and speculation share a structure of betting on contingent futures. — Aris Komporozos-Athanasiou, Speculative Communities: Living with…, 416; The derivative is a single instrument fusing insurance motives with betting motives. — Aris Komporozos-Athanasiou, Speculative Communities: Living with…, 90