[FRIAM] CSSSA April Webinar

Sat Apr 5 19:51:50 EDT 2025

Great topic overall, and one I have wanted to be thinking about in some community that will fill in for the time I don’t have to put into it seriously.

After the big crunch of 2008, there was a lot of talk about the position of Ireland relative to Germany.  Ireland borrowed money from German banks and then spent it on German-maufactured (luxury and practical) durable goods, the manufacturers of which (and their employees) put the money back into the German banks.  Net result was that all the money was where it had been but the Irish were holding a debt-service obligation and some durable goods.  My colleague Duncan Foley had an interest on these circular flows and how they pumped structure into different forms.

What the Irish didn’t put it into was infrastructure or other investments that would generate income to pay interest on their borrowings. They did buy up a bunch of residential property hoping to generate tourist income (and because, I have read, Irish have a thing about owning homes, and will pursue it far beyond their own needs for residences).  When tourism suddenly became impossible because a small percentage of bad assets froze a very large percentage of liquidity, the Irish were left with debt service obligations and no income from which to pay them.  

The moral I took from the story was two sides:  For Ireland: focus on income-generating capacity, which is enough of a challenge already for a small and island country.  For Germany, follow your own due-diligence rules, and don’t make loans that do not evaluate as generating the capacity to pay interest on them.

The extent to which the U.S. has been in this relation with the entire rest of the world since the end of WWII (at least) is one I would like to understand.  I have heard talk that the whole structure of the U.S. economy is based on expansion that requires the offshoring of borrowing to avoid what are called “crowding out” effects on domestic spending.  That’s what the foreign purchase of government debt gets U.S. fiscal planners, and the trickle-down of that to various consumers (citizens, companies, the government itself) shows up as the trade deficit in goods.

If it were only manufacturing, there would already be a story to tell.  A complicated one, too.  Capital and goods can move across borders, but laws don’t, so things like (lacks of) worker conditions and environmental protection are what really is the “comparative advantage” of offshored job sites.  In the early days, you could say Whatever: the US has become a service economy and we’ll let the rest of the world manufacture things.  That leaves aside the non-retrainability of people, who then go into rustbelts etc.  But that is all known story.

Even before big AI, though, just big communication was already offshoring many of the service jobs too.  Coding can (with complicaations, I understand) be done anywhere there is training for it, and things like call centers for commerce or “customer service” are easy to offshore.  So it happens sector-wise, but more and more of everything in the US gets offshored.  And with that, the income-generating capacity of whatever borrowed money gets spent on seems like it should diminish.  So more Ireland-like as the tourism business diminnished.

I have heard some talk, which probably has its own swamp online but I have not gone to look for it, that part of this national-crypto push is somebody’s idea of a plan to allow the US to continue to offshore debt as the proper dollar weakens, or possibly is abandoned as a reserve currency for most of the world.  Presumably through extortion and coruption channels, given who is dong it.

Clearly, my own mind is a fog of little fragments of this and that that I hear, from people I think are reputable and have at least local understanding.  But I very clearly do not have anything like a big picture that would enable me to navigate events back-of-the-envelop, and understand what they mean.

Eric

> On Apr 6, 2025, at 6:47 AM, Stephen Guerin <stephen.guerin at simtable.com> wrote:
> 
> Here's a web version of Marcus's prompt:
> "write an html/javascript ABM of U.S. trade that considers the deficit, debt, trade imbalances, and international capital flows."
> 
> this runs directly in the Claude web context with no downloads or setup.
> 
> And here is copying the page and deploying to play with the dog. 
> 
> https://guerin.acequia.io/sandbox/marcus-claude-economy.html
> 
> Old joke applies:  ""It's not that the dog talks well, it's that it talks at all."
> _________________________________________________________________
> Stephen Guerin
> CEO, Founder 
> https://simtable.com
> stephen.guerin at simtable.com 
> 
> stephenguerin at fas.harvard.edu
> Harvard Visualization Research and Teaching Lab
> 
> mobile: (505)577-5828
> 
> 
> On Sat, Apr 5, 2025 at 3:24 PM Marcus Daniels <marcus at snoutfarm.com> wrote:
> 	• Download Github Copilot.  Add Python module.
> 	• Get a Claude Console subscription.  Select Claude Sonnet 3.7 in Github Copilot.
> 	• Open the Chat window and select Agent.
> 	• Enter “Can you write an ABM of U.S. trade that considers the deficit, debt, trade imbalances, and international capital flows.  Watch project be populated.
> 	• Press Run.
> 	• Play with dog.
> 
> 
> From: Friam <friam-bounces at redfish.com> on behalf of Pieter Steenekamp <pieters at randcontrols.co.za>
> Date: Saturday, April 5, 2025 at 3:45 AM
> To: The Friday Morning Applied Complexity Coffee Group <friam at redfish.com>
> Subject: Re: [FRIAM] Fwd: CSSSA April Webinar
> 
> I listened to the above webinar on Agent-Based Modeling (ABM) in Economics and Finance, and would like to share a few reflections:
> 
> It would be wonderful to see this discipline develop further. In fields like transportation planning, ABM has already matured to a point where it arguably outperforms traditional top-down approaches. A few years ago in South Africa, ABM was used in planning a major public transport upgrade in Gauteng. I followed the project closely and, in my view, it was a great success. My friend Johan Joubert led the modeling effort, and the results were impressive.
> 
> But let me return to ABM in the context of Economics and Finance.
> 
> I understand that building effective ABM models in these domains is significantly more challenging than in transportation. Yet, imagine the value if it becomes a reality. The U.S., for example, is grappling with major economic issues: a growing federal deficit, mounting government debt, a persistent trade imbalance, and a population—especially the lower half—feeling economically left behind. Wouldn’t it be exciting if ABM could contribute to practical, data-driven solutions to these kinds of complex problems?
> 
> I was a bit disappointed that the webinar didn’t mention the potential integration of ABM with AI models in the context of Economics and Finance. There’s so much potential here. Large language models (LLMs) could help generate more nuanced and adaptable ABM scenarios, while ABM could provide rich, dynamic environments to train and refine AI models—especially reinforcement learning systems aimed at supporting policy-making. I’m optimistic that this kind of synergy will emerge in the near future.
> 
> 
> 
> On Sat, 29 Mar 2025 at 09:53, Stephen Guerin <stephen.guerin at simtable.com> wrote:
> 
> 
> 
> 
> 
> ---------- Forwarded message ---------
> From: Computational Social Science Society of the Americas <newsletter at computationalsocialscience.org>
> Date: Fri, Mar 28, 2025, 7:10 PM
> Subject: CSSSA April Webinar
> To: <stephen.guerin at simtable.com>
> 
> 
> 
> View this email in your browser
> 
> 
> 
> Dear CSSSA members,
> We are very excited to host Robert Axtell and Doyne Farmer discussing “Agent-Based Modeling in the Economics and Finence” in our 2025 webinar series on Wednesday, April 2nd, at 10 am (ET) . Click here to register for the webinar
> 
> 
> 
> 
> 
> 
> Abstract
> In a long paper in the Journal of Economic Literature Axtell and Farmer review agent-based modeling (ABM) in economics and finance and highlight how it can be used to relax conventional assumptions in standard models. ABM has enriched the understanding of markets, industrial organization, labor, macro, development, and environmental economics. In finance, substantial accomplishments include understanding clustered volatility, market impact, systemic risk, and housing markets. A vision is presented for how ABMs might be used in the future to build more realistic models of the economy. Hurdles that must be overcome to achieve this are discussed. Their paper includes more than 800 references including many from adjacent fields.
> 
> Biographs
> Professor Axtell is the author, with Joshua Epstein, of Growing Artificial Societies: Social Science from the Bottom Up (MIT Press). His research has appeared in Science, Nature, Proceedings of the National Academy of Sciences, as well as in leading field-specific journals such as The Journal of Economic Literature, The American Economic Review, The Economic Journal, and many others. His research has been reprised in newspapers (e.g., Wall St. Journal, Los Angeles Times, Washington Post) and science magazines (e.g., Scientific American, Technology Review, Wired). For the past decade he has been using microdata on individuals to build large-scale models of the Financial Crisis of 2008-9 (with JD Farmer, Oxford, and J Geanakoplos, Yale), the dynamics of business firms (with O Guerrero, Turing Institute), and natural resource exploitation, e.g., fisheries (with UC Santa Barbara, Oxford, and the Ocean Conservancy). The research on companies is described at length in a forthcoming book, ‘Dynamics of Firms from the Bottom Up: Data, Theories, and Models’, due out next year, which uses U.S. micro-data on firm sizes, ages, growth rates, networks, and locations to create a model at 1:1 scale with the American economy.
> 
> Prof. Doyne Farmer is an American complex systems scientist and entrepreneur with interests in chaos theory, complexity and econophysics. He has published papers in Science and Nature as well as leading economics journals like the Journal of Economic Behavior & Organization. He is Baillie Gifford Professor of Complex Systems Science at the Smith School of Enterprise and the Environment, Oxford University, where he is also director of the Complexity Economics programme at the Institute for New Economic Thinking at the Oxford Martin School. Additionally, he is an external professor at the Santa Fe Institute. His current research is on complexity economics, focusing on systemic risk in financial markets and technological progress. He has recently published a book entitled ‘Making Sense of Chaos: A Better Economics for a Better World.’
> 
> CSSSA Secretary is inviting you to a scheduled Zoom meeting.
> 
> Topic: CSSSA April Webinar
> Time: Apr 2, 2025 10:00 AM Eastern Time (US and Canada)
> Join Zoom Meeting
> https://us02web.zoom.us/j/82181451627?pwd=uYQJrmdphT9pefWvGKbhQgxQby3beG.1
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> Passcode: csssa2025
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