Musings Report #31 7-30-16 The High Cost of Honesty in a Sea of Low-Cost BS
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Welcome to July's MUS (Margins of the Unfiltered Swamp)
The last Musings of the month is a free-form exploration of the reaches of the fecund swamp that is the source of the blog, Musings and my books.
The High Cost of Honesty in a Sea of Low-Cost BS
Longtime correspondent Michael M. recently recommended this long-form article The Market For Lemons, The Market For Bullshit, And The Great Cascading Credence Crash Of 2016.
Michael's comments were thought-provoking:
"Honesty requires more time to analyze if bullshit is being peddled and customized towards you (after you have honestly presented your opinion)."
"Technology is primarily being used to replicate bullshit quicker and at almost zero cost."
Michael had previously sent the following comments in response to a link in Musings 27 on honesty:
"THE ABILITY TO BE HONEST is a very good point. I understand it as having the strength and time (!) to carry the consequences of being honest.
Being honest makes you more vulnerable, for as you become predictable, you are easier to game and you have fewer options to respond to weird/ crazy/ offensive behavior.
You dearly need extra time to constantly ask yourself if offers or opinions presented to you (after you have honestly presented your opinion) are true, or marketing versions (BS) that have been tailored for you."
The gist of the "market for BS" article is that BS is now so cheap to distribute and so over-abundant that the "market for BS", i.e. its believability, will soon crash.
Our first reaction might be to cheer such a loss of confidence in the BS narratives that support the status quo, but the author of the article goes to some pains to show that widespread acceptance of BS narratives has positive attributes:
1. we all share a common ground of narratives that enable a variety of shared goals and transactions
2. these transactions are generally low-cost because the cost of challenging the narratives has been reduced.
Put another way: a world in which BS has depreciated to zero is a world in which everything must challenged and the cost of sorting truth and honesty from BS is permanently high.
Once faith in BS drops to zero, every opinion is equally suspect and equally "true" until costly investigation proves otherwise.
Michael's comments invite an exploration of the high costs of honesty in a system in which technology enables the nearly-free propagation of BS and the nearly-free automation of BS responses to opinions that were achieved by honest (and therefore high-cost) effort.
In this way, BS is like cheating in school: the cost of cheating is low and the rewards if the "mark" (the teacher) accepts the BS as real are high. In comparison, the cost of learning the material thoroughly is very high and the rewards (a good grade) have been depreciated by BS (grade inflation to quell student-parent complaints about low grades--everyone gets a B for showing up and BS often earns a A).
The ability to form honestly reached conclusions is costly in terms of time and effort, and it's "cheaper" to accept BS. As the author of the article observed, just as Gresham's Law holds that bad money will drive out good money (as people hoard the good money and use the bad money as quickly as possible), BS drives out honesty and honestly reached conclusions.
Michael also points out that the cost of maintaining honesty is high, as media and technology inundate us with BS designed to persuade everyone in our profile of views/purchases.
What can we conclude from the high cost of honesty in a world of nearly-free BS?
1. One way to lower the cost of maintaining honesty is reduce the inputs of BS from a fire hose to a trickle by limiting exposure to both mass and targeted media.
2. Decentralized, distributed systems such as bitcoin enable trusted transactions without the high costs of centralized verification, authentication, etc.
3. Dealing exclusively with honest people and truthful institutions lowers the cost of being honest.
4. As the cost of propagating BS drops to near-zero, the value of honestly achieved analyses and conclusions rises proportionately.
5. The ability to remain honest in a sea of BS is akin to holding gold coins in an economy of lead coins coated with a microscopic layer of gold to appear "solid gold."
From Left Field
Patrick Deneen explains how kids have become a generation of know-nothings
"What our educational system aims to produce is cultural amnesia, a wholesale lack of curiosity, history-less free agents, and educational goals composed of content-free processes and unexamined buzz-words like 'critical thinking,' 'diversity,' 'ways of knowing,' 'social justice,' and 'cultural competence.'"
How the pieces are falling into place for another global financial crisis
The Unbearable Transience of Alpha
With hedge funds responsible for the majority of global trading in several asset classes, the sell side realized there was a market for complexity.
The Public Shaming of England’s First Umbrella User: This pioneer of weather management was pelted with insults and trash.
IMF admits disastrous love affair with the euro and apologises for the immolation of Greece
Americans Blow $27.8 Billion a Year by Being Lazy (via Joel M.) -- health is priceless....
'The graveyard of the Earth': inside City 40, Russia's deadly nuclear secret (via Chris M.)
MH370 pilot's flight simulator plotted course over southern Indian Ocean -- after 2 years of denial the pilot had anything to do with the loss of the aircraft...
5 Reasons Why Trump Will Win (via GFB) -- good to see Moore note that this is the only way left to push a thumb in the eye of a pathologically greedy Elite...
An Auction House Learns the Art of Shadow Banking (via Maoxian) -- Need $35 M loan? Just ask Sothebys...
Chinese Communist Party’s New TV Ad Asks, ‘Who Am I?' -- slick advert shows the CCP is worried about its decaying image... more BS in a sea of BS,,,
The Top 10 Films of 2015 (via Maoxian) -- didn't make me want to rent/borrow any of them...
Seven Signs of Ethical Collapse -- how many top US companies qualify, based on their BS "one-time charges" accounting?
"If one does not know to which port one is sailing, no wind is favorable." Seneca the Younger
Thanks for reading--
charles |
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