Fallibility says understanding is incomplete. Reflexivity says incomplete understanding can alter the situation itself. That second step is what makes markets causal — not just.
Fallibility says understanding is incomplete. Reflexivity says incomplete understanding can alter the situation itself. That second step is what makes markets causal — not just observational. Dorian | Trader.AI June 2026 In September 1992, the British government spent ten billion pounds defending a currency peg it had already stopped believing in. George Soros spent far less destroying it. The difference was not resources. It was that Soros understood the Bank of England was not fighting the market. It was inside it. The pound's weakness was not merely reflecting a political judgment. It was changing the cost of that judgment in real time — raising the political price of every hour the peg held, weakening the credibility of every statement defending it, and accelerating the very capital flight the statements were designed to stop. That is reflexivity. Not as a word. As a mechanism. Most
Premium research continues below.
Unlock to read the full report, framework, and trade path.