Out of the frying pan, into the… water? NYC on the Hudson River at sunset. // Photo: Neel Mehta, FLUX
Episode 254 — October 8th, 2026 — Available at read.fluxcollective.org/p/254
Contributors to this issue: Justin Quimby, Erika Rice Scherpelz, Ben Mathes, Neel Mehta, MK, Boris Smus
Additional insights from: Ade Oshineye, Dart Lindsley, Jasen Robillard, Jon Lebensold, Laura Eberly, Lisie Lillianfeld, Robinson Eaton, Spencer Pitman, Stefano Mazzocchi, Wesley Beary, and the rest of the FLUX Collective
We’re a ragtag band of systems thinkers who have been dedicating our early mornings to finding new lenses to help you make sense of the complex world we live in. This newsletter is a collection of patterns we’ve noticed in recent weeks.
“The foundation of cooperation is not really trust, but the durability of the relationship.”
— Robert Axelrod, The Evolution of Cooperation (1984)
💰🎲 The nature of the bag
We live in interesting times. As anxiety grows over bond rates, supply-chain disruption, or new plagues, and as government stability ping-pongs through the information ecosystem, we see more and more people become aware of the K-shaped economy. This is an economy where a booming and prosperous middle class becomes a history lesson, not a lived reality. This is a zeitgeist where the phrase “permanent underclass” has blossomed in the past 18 months.
The K-shaped economy changes the nature of day-to-day lived experience, but the impact goes beyond that. In game theory, huge differences exist between players playing an infinite game vs. a finite one. In an iterated infinite game, there’s an incentive to cooperate, at least to some degree. Malicious and destructive tactics accumulate distrust and ill-will from other players, resulting in fewer benefits for the malicious player. In finite games, non-cooperative behavior can result in a player winning significantly more before walking away. Those are short-term gains… but when the short-term is all there is, those are the only gains to be had.
The short-term players “got their bag.” When “the bag” means generational wealth, it can make otherwise distasteful tactics feel justified. The end, one might say, justified the means. But in these short-term gains, “the bag” often comes at a cost to others, exacerbating the differences between the haves and have-nots.
We see this in the crypto and financial worlds. In every crypto rug-pull, a few small groups of insiders are “bag takers,” while the vast majority are left “holding the bag.”
Let’s add a third dynamic: the opportunistic outsider. These are the people who see opportunity in an environment with massive economic upheaval. California’s Gold Rush (1848-1858) saw vast fortunes minted by those who “sold shovels” to prospectors. The aftermath of the US Civil War saw some Northerners, pejoratively called “carpetbaggers” by Southern Democrats, moving South to make their fortunes during the Reconstruction era (1865-1877). One specific example is that, in 1870, Northerners controlled 21% of the South’s railroads (by mileage); 19% of the directors were from the North. By 1890, they controlled 88% of the mileage; 47% of the directors were from the North.1
Unlike those who “got their bag”, the opportunists are not necessarily using immoral means, but they’re often resented nonetheless. They are the outsiders who figured out how to play the game better than those who “earned” their way there.
But not all shovel-sellers are the same. One might make a fortune from the rush and disappear. Or they might make tools that remain useful when the rush is over. They might become part of the community. Both spot an opportunity; what they leave behind is different.
That suggests another dynamic: the builder. Builders may be opportunists, but their opportunity is win-win, not zero (or negative) sum. A general store might open to sell supplies to prospectors, then become the place where people trade news and find work while they buy what they need long after the rush ends. These are choices about the rules of the game. If more people benefit from another round, more people have a reason to keep playing together.
Every gold rush has those who “get the bag” and those who “hold the bag.” It has the opportunists and the builders. This is a dynamic that seems to arise when fortunes are to be made and there are few options between being a winner and a loser. This sort of environment primes people to take risks, the sort of risks that lead to a win or a loss. Many are treating AI as the current gold rush. So as the AI engine continues to churn away and more people chase their bag, consider whether you want to play the finite game or choose a different set of rules and take the odds on a cooperative, infinite game.
Although, perhaps the choice isn’t entirely up to any one player. Be it finite or infinite, a game is something we play together. So in the game of our economy, relationships, and value systems, how might we build tools and institutions that give people a reason and a way to stay in the game for the long run?
🛣️🚩 Signposts
Clues that point to where our changing world might lead us.
🚏🎨 Someone vibe-coded open-source versions of Adobe’s top seven creative apps
A veteran software developer used Claude Code to develop free, open-source versions of seven Adobe Creative Suite apps: Photoshop, Illustrator, Premiere, Lightroom, Acrobat Pro, After Effects, and InDesign. These apps, built entirely in the popular language Rust, are “clean-room reimplementations” of the famous (and famously expensive) Adobe products, and are compatible with Adobe’s official formats. One reviewer found these apps glitchy but useful and close enough to the originals.
🚏🧲 Germany’s far-right and far-left party teamed up to propose ending Ukraine aid
The recent parliamentary election in the eastern German state of Saxony-Anhalt led to a shakeup: the infamous far-right AfD party won the most seats and fell just a few short of an outright majority. The other mainstream parties show little interest in working with AfD, so it seems to be allying with the far left-wing party BSW; the parties would combine for a slim majority of seats. One of AfD and BSW’s first acts will be proposing a joint resolution that would call for ending military aid to Ukraine and lifting sanctions on Russia. (Observers note that states have no impact on foreign policy, so the resolution would be purely symbolic.) While AfD and BSW may seem to be strange bedfellows, both are Eurosceptic populist parties and are considered to be culturally conservative — which brings horseshoe theory to mind.
🚏🫎 A Colorado wildlife overpass (the world’s largest) reduced animal collisions 91%
Highways can be highly harmful to wild animals, acting as walls that lead to habitat fragmentation; animals that try to cross the highways often collide with cars, endangering beast and human alike. In 2019, Douglas County, Colorado (not far from Denver) built the world’s largest highway overpass: a massive, grass-covered bridge that lets animals walk above the road. The 209-by-200 foot bridge has been credited for reducing wildlife collisions by 91%; the collision reduction means the overpass will pay for itself in 15 years, according to the state’s department of transportation. The overpass was designed for the pronghorn and elk that roam the area, but biologists have noticed that bears, deer, coyote, and other animals have used it as well.
🚏🪙 California is banning public officials from making memecoins
Gavin Newsom, the governor of California, recently signed a bill that will ban the state’s public officials, who includes elected officials and state government employees, from making memecoins, or joke cryptocurrencies whose value depends solely on hype and which are usually intended for quick pump-and-dumps. The bill also bans companies from launching memecoins using “the likeness or image of a public official.” Besides the potential harm to consumers (nearly a million “investors” lost $3.8 billion on a Trump-themed memecoin), the governor warned that memecoins could let public employees corruptly profit off their office.
📖⏳ Worth your time
Some especially insightful pieces we’ve read, watched, and listened to recently.
How to Write with LLMs (Final Ward) — Proposes two simple rules to make LLMs enhance your writing process rather than “pasteurizing and jacking it with corn syrup”: never use a single word the LLM suggests to you, and avoid encouragement from AI (which leans toward sycophancy). Instead, use LLMs as copyeditors; if they flag a problematic passage, you can ask another fresh LLM to compare the original and revised versions and pick the better one.
A Series of Vignettes From My Childhood and Early Career (Jason Scheirer) — Argues that every generation confidently predicted programming’s imminent death. In 1996, the author’s mentor warned that OOP would create “a library of objects, like books on a bookshelf” where “business people just snap the object libraries together like LEGOs,” but the work just migrates up one abstraction layer each time.
Barbarity and Civilization: Explaining Wanton Violence in the Conduct of War (Dead Carl and You) — Examines the US’s current “fruitless bombing campaign against Iran” through the lens of Carl von Clausewitz’s military theories, seeking to explain why a presumably rational modern state would waste its energy and matériel on unproductive violence. Military historians in the Enlightenment thought that advancing “civilization” would lead war to become more refined and less violent, but Clausewitz posits that advancing development just increases states’ potential for violence. Plus, bureaucratic institutions can still commit inefficient violence if their leaders get emotional or if policymakers believes that said violence is actually useful.
Heart Rate Variability Biofeedback: How and Why Does It Work (Frontiers) — Introduces HRV, an up-and-coming idea in physiology. Turns out the pressure wave produced by the heart and breathing are deeply intertwingled. By breathing at a certain frequency (~6 breaths a minute), one can increase HRV temporarily, and also exercise the neuroplasticity in the baroreflex, increasing resting HRV.
🔍📆 Lens of the week
Introducing new ways to see the world and new tools to add to your mental arsenal.
This week’s lens: ground truthing.
Customers love our new feature! 1,000 uses in the first week. Hurrah! Then someone notices that 900 came from the same hundred accounts. They were all trying repeatedly to finish one task. It turns out the feature wasn’t really good. It was bad. Really bad. So bad it hardly worked.
We frequently turn to the idea of ground truth, not as a noun, but as a verb. This is the moment where a set of beliefs experiences a temporary “mark to market.” Delusions collapse back into empirical data. This collision with ground truth can be organizationally and culturally disruptive since it pierces the veil of load-bearing polite fictions. “We’re doing well.” “I know what’s going on.” “We will survive the next year.”
Sometimes we accidentally (or intentionally) manufacture the need for ground truthing. When we greenshift status so that the news gets just a little bit better each level it goes up the hierarchy, then we are creating the need for ground truthing down the line.
Why only a temporary correction? Because in a world of geologically active ground, some truth is shifting. Many things are stable — this isn’t relativism! — but almost all of us have key parts of our worldview that belong to the more molten aspects of reality. So we ground truth today just to find ourselves wrong tomorrow. For example, it turns out that “Ha ha! AI hallucinates” never became truly false, but agents, LLMs running tools in loops, made hallucinations much, much less relevant. (In fact, you could say that tool use allowed agents to ground truth, thus making this example relevant on two levels.)
To avoid the sort of major corrections that disrupt an organizational culture or a personal belief system, we need to be in a consistent process of building new ground truth. When we do so, then the ground truth can be more easily known, adjusted for, and by its own absorption, become irrelevant. This process cannot be saved up for later. We always have to be building new ground truthing mechanisms, or else our existing mechanisms will calcify.
© 2026 The FLUX Collective. All rights reserved. Questions? Contact flux-collective@googlegroups.com.
Klein, Maury. “Southern Railroad Leaders, 1865–1893: Identities and Ideologies.” *Business History Review* 42, no. 2 (1968).