Jae Kim

The Measurement Trap: How Backward‑Looking Measurements Destabilize the Systems They Were Designed to Protect

Institutions routinely make consequential decisions from backward-looking measurements — smoothed averages, trend estimates, and filtered signals meant to separate noise from signal. This paper asks what happens when such a measurement feeds back into the system it measures, and...

The Adaptation Tax: How Trailing Averages in Policy Tools Systematically Misprice Downturns

Trailing averages are embedded in the institutional infrastructure that governs monetary policy, banking regulation, and retirement security. Because a trailing average mathematically converges toward the series it tracks, it absorbs economic shocks into its own definition of "no...

The Compound Trap: No Combination of Monetary, Fiscal, or Regulatory Policy Can Offset the Basel Credit Instability

Basel III's countercyclical capital buffer is steered by the credit-to-GDP gap: credit relative to a one-sided Hodrick-Prescott trend that, at the codified smoothing parameter, behaves like an 80-quarter moving average. A companion paper, "The Measurement Trap," showed that a fee...

The Adaptation Tax: How Trailing Averages in Policy Tools Systematically Misprice Downturns

Trailing averages are embedded in the institutional infrastructure that governs monetary policy, banking regulation, and retirement security. Because a trailing average mathematically converges toward the series it tracks, it absorbs economic shocks into its own definition of "no...

The Divergence Theorem for Regime Transition Detection: Multi-Scale Estimator Disagreement as a Cross-Domain Early Warning Signal

Many fields anticipate regime transitions by comparing a fast, recent estimate of a system's variability to a slower baseline — the moving-average convergence/divergence indicator in finance, the Sahm Rule in macroeconomics, rising-variance indicators in ecology — without a share...

Multi-Sensor Convergence as a Regime Detection Signal: The Sensor Convergence Theorem

When several independent instruments observing one system begin to move together, that agreement carries information about the system’s near future. We formalize this as the Sensor Convergence Theorem: under a latent factor model with three scope conditions — sensor independence,...

Multi-Sensor Convergence as a Regime Detection Signal: The Sensor Convergence Theorem

When several independent instruments observing one system begin to move together, that agreement carries information about the system’s near future. We formalize this as the Sensor Convergence Theorem: under a latent factor model with three scope conditions — sensor independence,...

The Divergence Theorem for Regime Transition Detection: Multi-Scale Estimator Disagreement as a Cross-Domain Early Warning Signal

Many fields anticipate regime transitions by comparing a fast, recent estimate of a system's variability to a slower baseline — the moving-average convergence/divergence indicator in finance, the Sahm Rule in macroeconomics, rising-variance indicators in ecology — without a share...