Speaker 1: Hello, and welcome to another episode of the Odd Lots Podcast.
Speaker 1: I'm Joe Wisen and I'm Tracy Hallowitt. Hi, Tracy, we're
Speaker 1: in the same room together. I know um and I'm
Speaker 1: looking at you while I say hello, which is different
Speaker 1: to what we normally do. But it's nice to see
Speaker 1: you in person again. Absolutely. Okay, So we're not talking
Speaker 1: about poker on this episode. Now, I love poker and chess,
Speaker 1: anything else that you love. We're not talking about poker
Speaker 1: on this episode. But remember a couple of weeks ago
Speaker 1: when we talked to uh Andy Douke, the former professional
Speaker 1: poker player. Of course, one of our best episodes I
Speaker 1: think in a while, and of course her whole thing.
Speaker 1: And she has this new book out called Thinking in Beds,
Speaker 1: and one of her big ideas that she talked about
Speaker 1: was that to be successful in poker or trading, which
Speaker 1: is particularly relevant to us, people have to not get
Speaker 1: attached to certain ideas. They have to be willing to
Speaker 1: discard things that are wrong, which is very tough for people. Yeah,
Speaker 1: there's a lot of confirmation bias in trading, and people
Speaker 1: kind of refuse to let go of trades that are
Speaker 1: going the wrong way. Right because they think it will
Speaker 1: come back eventually, they really want to be right, or
Speaker 1: they want to fit a market move into some existing
Speaker 1: worldview and really jam it in. And Okay, so we
Speaker 1: say all that, we're like, oh, people do this, and
Speaker 1: I think that's pretty easy for people to accept. But
Speaker 1: I raised the question of why we do this? Why
Speaker 1: is it so hard for us to update our beliefs
Speaker 1: when new faction merge? Or why are we so interested
Speaker 1: in coming up with an idea and fitting it into
Speaker 1: an ideology or worldview even if it doesn't fit. Yeah?
Speaker 1: Why are we seemingly incontrovertibly forever doomed to repeat this
Speaker 1: one mistake? And why do we hate the truth? Right? Yeah? Okay, okay, yes,
Speaker 1: So today we're going to try to answer that question
Speaker 1: why we why we hate the truth, why we all
Speaker 1: hate facts? And why this makes us all bad traitors? Okay?
Speaker 1: Who are we talking to on this one? So I'm
Speaker 1: very excited. I came across this paper the other day.
Speaker 1: It's called the partisan Brain, an identity based model of
Speaker 1: political belief and it talks about various explanations for this
Speaker 1: phenomenon of our brains rejecting truth. And we have one
Speaker 1: of the authors, j Van Babl. He is a professor
Speaker 1: at n y U and uh, he's going to walk
Speaker 1: us through um some of his research. What does he learned? Specifically,
Speaker 1: he's an associate professor of psychology and neural science at
Speaker 1: New York University. So he's going to explain to us
Speaker 1: why we like lies, why we like lies exactly. Let's
Speaker 1: do it. J Van Babel, thank you very much, thanks
Speaker 1: for having so is this accurate? Do we just all
Speaker 1: hate the truth? Sometimes we love the truth. It really
Speaker 1: hinges on what our goals are. If we're looking for accuracy,
Speaker 1: and that's part of our edity, then we look to
Speaker 1: see code evidence that we might be wrong, or at
Speaker 1: least verification that we know what we believe. And if
Speaker 1: we are motivated by other goals, For example, if we
Speaker 1: have a commitment to a political belief for a political party,
Speaker 1: we might be compelled to believe them and ignore facts
Speaker 1: that contradict that particular identity. So I set it up
Speaker 1: obviously within the context of odd lots we talk about
Speaker 1: markets and trading. The paper itself, though, is about you know,
Speaker 1: as the title says, the partisan brain, My intuition and
Speaker 1: my sentence is that a lot of what you've studied
Speaker 1: about how political ideologues see the world has applicability to
Speaker 1: the realm of trading in other areas. But just sort
Speaker 1: of give us the overview of what this paper tried
Speaker 1: to show. So what this paper tries to do is
Speaker 1: bridge research in political science, which is about political parties
Speaker 1: and ideologies with research and psychology, so what types of
Speaker 1: things motivate us to engage in certain behaviors or hold
Speaker 1: certain beliefs as well as neuroscience. So we looked inside
Speaker 1: the brain and try to get a handle on if
Speaker 1: you're being biased in some way by some commitment to
Speaker 1: uh an identity or political party. Is that shaping the
Speaker 1: way that you're reasoning, So your prefrontal cortex, is it
Speaker 1: overactive and trying to argue or change your understanding of something,
Speaker 1: or is it shaping our memory or emotional system or
Speaker 1: maybe even our perceptual interpretations of the world, which is
Speaker 1: really damning because if you're shaping how you see the world,
Speaker 1: it's gonna be really hard to fix that. It's like
Speaker 1: a perceptual illusion where you know, you see the dress
Speaker 1: one way, I see it another way with another set
Speaker 1: of colors and we'll just forever argue about it. So
Speaker 1: what exactly did you find then? Because in my mind
Speaker 1: I can imagine like I get a little bit of
Speaker 1: a shot of serotonin every time someone tells me I'm
Speaker 1: right or says that was a good question. So when
Speaker 1: I think about these sort of confirmation biases, that's what
Speaker 1: I think about. But you seem to be talking about
Speaker 1: wide variety here. Yeah, so confirmation is certainly part of it.
Speaker 1: We want to confirm what we are pret existing beliefs.
Speaker 1: But what matters more is confirming or supporting or affirming
Speaker 1: particular identities you have. And so if you're a trader
Speaker 1: who's committed to, you know, economic outcomes of improving your performance,
Speaker 1: you should care a lot about facts. If you're an
Speaker 1: investigative journalist or a scientist, if those are your identities,
Speaker 1: you care a lot about truth. But most people don't
Speaker 1: care about those things most of the time. And even
Speaker 1: professors or traders or journalists sometimes get led astray by
Speaker 1: other goals that they have a goal to achieve status
Speaker 1: or power or um affirm SENSI belonging, so to do
Speaker 1: what is popular, or people might engage in what's called groupthink,
Speaker 1: where they're kind of fitting in with the group beliefs
Speaker 1: or norms, and those types of political motives and social
Speaker 1: motives can lead us astray. So you might one might
Speaker 1: you know, you give some examples in your research of
Speaker 1: political ideologus or people who are belonging to one party
Speaker 1: actually remembering facts differently. So, for example, Democrats are more
Speaker 1: likely to believe incorrectly that George W. Bush was on
Speaker 1: vacation during Hurricane Katrina, so things like that. So but
Speaker 1: in the research you explained that to some extent, it
Speaker 1: makes sense. In other words, the brain puts a higher
Speaker 1: priority on believing something that makes sense for the group Democrats,
Speaker 1: rather than putting a higher priority on factual accuracy. So
Speaker 1: why does the brain elevate that sense above accuracy. Yeah,
Speaker 1: so that's a great question. It goes back to thinking
Speaker 1: about why do we have the brains we do. And
Speaker 1: so our brains evolved over several hundred thousand years in
Speaker 1: small tribes in Africa, and we were Humans are pretty
Speaker 1: flimsy creatures. Okay, so we're not very strong or particularly fast,
Speaker 1: so we're gonna get swallowed up by other creatures very
Speaker 1: quickly unless we cooperated and fit in and if you
Speaker 1: didn't fit in, you were shandrised from the group, and
Speaker 1: so that was incredibly threatening. It was literally a threat
Speaker 1: to your survival and certainly you would have had reproductive
Speaker 1: opportunities if you weren't well respected and liked in your group.
Speaker 1: And you can see the same thing in chimpanzees are
Speaker 1: are one of our nearest genetic neighbors. Um they care
Speaker 1: a lot about what their status is in the group,
Speaker 1: and if they're excluded or if they fall down to
Speaker 1: the bottom of the ladder, the outcomes for them aren't
Speaker 1: very good and they're less likely to survive or pass
Speaker 1: along their genes to future generations. And so through evolution,
Speaker 1: we've developed these brains that are well adapted for fitting
Speaker 1: into groups and getting along with other people in our groups,
Speaker 1: and to the extent we can do that, and a
Speaker 1: lot of it is through psychological tricks that guide us
Speaker 1: towards things that now look irrational, but if you think
Speaker 1: about human history, they actually were rational. They helped us survive,
Speaker 1: and that's why we're the ancestors who have these particular
Speaker 1: quirks of cognition. So if you were a stone age
Speaker 1: Cassandra preaching the truth put it threatened the rest of
Speaker 1: your tribe, they would kick you out, or at the
Speaker 1: very least you wouldn't be able to find a mate.
Speaker 1: There are no shortage of examples of that throughout history.
Speaker 1: So I imagine that that sort of evolution and that
Speaker 1: tribal heritage probably doesn't align very well with the modern world.
Speaker 1: It doesn't. Yeah, we live. So we're here in Manhattan.
Speaker 1: It's incredibly safe. We're safer and more prosperous than any
Speaker 1: time in human history, and so we really don't have
Speaker 1: a need to be afraid of a lot of things
Speaker 1: that we're afraid of. But we are because we have
Speaker 1: the brain that is over sensitive to things that might
Speaker 1: have killed our ancestors. What are some other examples of
Speaker 1: ways that the brain prioritizes things other than pure factual accuracy. Yeah,
Speaker 1: So I would say I was mentioning to you both
Speaker 1: earlier before we got on the show, is I'm a
Speaker 1: big sports fan, and one of the first things professional
Speaker 1: gamblers will tell you is don't bet on your favorite teams.
Speaker 1: And the reason is because we're so identified with those teams,
Speaker 1: we want them to win to affirm our fanship and
Speaker 1: identity with them, that we make bad bets and so
Speaker 1: if you ever want to sucker somebody, get them to
Speaker 1: support some team that they really love or have a
Speaker 1: flag flying out of their front porch on and that's
Speaker 1: the type of person who's going to be more likely
Speaker 1: to overestimate the probability of success of that. And is
Speaker 1: it that same group think social comfort that causes that.
Speaker 1: Is that essentially that just go back to that same
Speaker 1: survival instinct. Yeah, it's driven by our need to belong,
Speaker 1: our need for status, um also our need to be
Speaker 1: good virtuous people. So we like to think, especially our
Speaker 1: political groups, which are attached to morality, are virtuous, are
Speaker 1: better than the other ones. And if we didn't think that,
Speaker 1: we wouldn't vote for them in the first place. And
Speaker 1: so we're constantly looking for evidence that we're on the
Speaker 1: right side of political history. So you touched on this earlier.
Speaker 1: But if you are a trader, you think that maybe
Speaker 1: because your motivation is to make money, the bias doesn't
Speaker 1: come into it as much. Is that your general just
Speaker 1: I know of paper was about political biases. But yeah,
Speaker 1: so let me give you an example of political bias.
Speaker 1: There's some research showing that if you put monetary stakes
Speaker 1: on what people say politically, they're more likely to be accurate,
Speaker 1: and so there is reason to believe that that kind
Speaker 1: of financial accountability can increase the extent to which you
Speaker 1: value accuracy and guide you to the right answer, But
Speaker 1: it doesn't get you all the way there, and sometimes
Speaker 1: that bias pops up in other places in your behavior.
Speaker 1: And so I think traders have pretty good built in
Speaker 1: incentives to make them more accurate. But again, they're human,
Speaker 1: and when they're not thinking about the bottom mind that
Speaker 1: might be thinking about status or stature in the economic
Speaker 1: world or something like that. Those are the types of
Speaker 1: motives that are likely to guide them astray. So I
Speaker 1: remember thinking about this very vividly in the wake of
Speaker 1: the financial crisis, because there were a lot of these
Speaker 1: legacy hedge funders who didn't like fiscal stimulus and they
Speaker 1: didn't like quantitative easing and you're all kind of conservative
Speaker 1: and cray key and being too mean, but they a
Speaker 1: lot of them came of age during the Reagan era
Speaker 1: and they know and like it was very clear that
Speaker 1: experience and that ideology, and they many of them were
Speaker 1: very barished for too long. And I remember the hedge
Speaker 1: funder David Temper who was a Democrat, and he did
Speaker 1: phenomenally well. And I don't think it's because democrats are
Speaker 1: better traders. I think it was because and I thought
Speaker 1: at the time that he didn't have any particular reason
Speaker 1: to dislike the overall situation right now, and he didn't
Speaker 1: let that get in the way of his, uh of
Speaker 1: his trading. Yeah, so I'm glad you connected politics to trading.
Speaker 1: I think there's a really good lesson here. So one
Speaker 1: is that through our experiences we build an ideology, a
Speaker 1: sense of how the world works, whether it's the financial
Speaker 1: system or social relations. And ideologies are really good because
Speaker 1: they can generate all kinds of predictions for us what's
Speaker 1: going to happen and how we should play out certain situations.
Speaker 1: But the problem with ideology is is that we become
Speaker 1: extremely committed to them. We start looking for evidence that
Speaker 1: they're true. And the reason for that is think of
Speaker 1: how threatening it would be if I told you your
Speaker 1: whole belief system was wrong. You have to start from scratch.
Speaker 1: And so that's the reason that we get defensive and
Speaker 1: cling to our worldviews and ideologies. And that's and when
Speaker 1: in situations like that where they lead us astray, it
Speaker 1: often takes a lot of additional evidence to prove those
Speaker 1: people that they're wrong. They're going to cling to that,
Speaker 1: and especially if they've been on the public record or
Speaker 1: among their friends as saying they believe in it. There's
Speaker 1: a social cost to admitting you're wrong. So when it
Speaker 1: comes to building ideologies or trade ideas or financial narratives,
Speaker 1: I feel like the big difference now is that there
Speaker 1: is so much data and information out there that you
Speaker 1: can pretty much cherry pick whatever narrative that you want.
Speaker 1: So how does that play into all of this? Okay,
Speaker 1: so I'll say that's the same as what I think
Speaker 1: has happened in politics that's been really bad, which is
Speaker 1: that used to be you had three major TV stations
Speaker 1: and a trusted news anchor who came on at five pm.
Speaker 1: We're all watching the news, and it was vetted with
Speaker 1: the similar editorial standards. What's happened is you've had the
Speaker 1: dispersion of news. So now you can cherry pick what
Speaker 1: news you want to go to about whatever political story
Speaker 1: of the day, um, and you can kind of drill
Speaker 1: down into some rabbit holes on the internet based on
Speaker 1: whatever you want to believe. And it's probably the same
Speaker 1: thing with a financial information. There's so many people with
Speaker 1: so much information, and instead of relying on a small
Speaker 1: number of trusted sources of information, you could easily get
Speaker 1: stuck looking for evidence for your ideology and probably find
Speaker 1: it no matter what your belief system is. And so
Speaker 1: information can be very helpful to people at times, um
Speaker 1: if they use it in the right way. But the
Speaker 1: brain wants to find evidence that supports its belief and
Speaker 1: that can lead us astray because we'll just cherry pick
Speaker 1: data that supports that belief, and scientists can do that too,
Speaker 1: and it's dangerous for us just as much as it
Speaker 1: is for traders. And I'm thinking a lot too about
Speaker 1: the people who we know, like are very bearish all
Speaker 1: these years, and even the upward move intostoction the economy
Speaker 1: is proof that they're right, because then that just shows
Speaker 1: that the whole thing is rigged in a bubble or
Speaker 1: for the bulls, correction is always it's always exactly right.
Speaker 1: It's the it's the flip side. I'm curious if there
Speaker 1: are patterns of people who are just better than others
Speaker 1: it not falling into this trap. Yeah, So I just
Speaker 1: saw talk on this from a colleague of mine at Yale,
Speaker 1: who's measuring people's analytic abilities, and so you there's a
Speaker 1: simple measure called the cognitive response test that people can take,
Speaker 1: and some people tend to go with intuitive, automatic responses.
Speaker 1: And so one question might be, there's a pond with
Speaker 1: lilies growing on it, and you know, after fifty days,
Speaker 1: the pond is entirely covered and the lilies go double
Speaker 1: in size each day, and so how full was the
Speaker 1: pond at day forty nine? Uh? Half full? Half full? Right? Um?
Speaker 1: A lot of people really like I got by the way,
Speaker 1: there's really stressful quiz in the middle of the poet
Speaker 1: good um. You know, a huge proportion of Ivy League
Speaker 1: students fail this. These types of questions they're not they're
Speaker 1: not easy. The reason is, even people who are smart,
Speaker 1: the instinct is to say twenty five days, because that's
Speaker 1: they're growing at twice the rate every day, and you're
Speaker 1: thinking it's fifty days the ponds full. The halfway point
Speaker 1: should be twenty five days. And so a lot of
Speaker 1: people will say that response, and they do it automatically.
Speaker 1: Some people like you stop, catch yourself, analyze your thinking critically,
Speaker 1: and then give a response. This This just proves that
Speaker 1: I should be a trader. Right. This is like, so
Speaker 1: a lot of us have intuitions about what we should
Speaker 1: do or what's right or wrong, But the best people
Speaker 1: among us say, wait a second, that sounds too good
Speaker 1: to be true, or that news doesn't seem quite right.
Speaker 1: I'm gonna go to fact check it, and a lot
Speaker 1: of fact checking now you can do in thirty seconds
Speaker 1: you go to Snopes or something. But most people don't
Speaker 1: do that. They are like, oh, I knew that along,
Speaker 1: now I'm going to share it. But do those people
Speaker 1: who do take the extra thirty seconds to check something
Speaker 1: on snokes that they saw on Facebook or catch themselves
Speaker 1: before they answer a riddle? Did they descend from some
Speaker 1: other group of people or did they do? Why? Yeah,
Speaker 1: why don't they have that instinct to you know, just basically, well,
Speaker 1: move more on instinct? Yeah, I guess there's some The
Speaker 1: way of thinking about is that there's some situations where
Speaker 1: going with your instinct is helpful, and so what ends
Speaker 1: up What that means is there's other situations where it doesn't.
Speaker 1: So you end up with a normal distribution of humans,
Speaker 1: some of which are very intuitive and guided by automatic reactions,
Speaker 1: and the rest of which are kind of the opposite.
Speaker 1: They're catching themselves. I do think I would not have
Speaker 1: done well on the Stone Age for what I'm just
Speaker 1: putting it out there right now. I think I would
Speaker 1: have been cast out pretty and not found a mate.
Speaker 1: So obviously this has pretty profound implications for politics, especially
Speaker 1: as it gets easier and easier to craft our own narratives.
Speaker 1: And as you know, and there's been a fair amount
Speaker 1: of discussion of this, and we live in our own
Speaker 1: worlds of our own facts and our own new sources,
Speaker 1: and so that aspect of it, people will grasp what
Speaker 1: can is there. You talk a little bit in the
Speaker 1: paper about things that can be done to ameliorate some
Speaker 1: of these effects. So theoretically, if we want to save democracy,
Speaker 1: it would be nice. I maybe people could emerge towards
Speaker 1: one set of shared facts. What works in terms of
Speaker 1: getting people to lower social identity in their mental hierarchies. Yeah,
Speaker 1: so one thing is developing other identities that value accuracy.
Speaker 1: And so all of us have multiple identities. I am
Speaker 1: a father, a son, a professor, a Canadian, and all
Speaker 1: of these come online at different times. When I'm watching
Speaker 1: the Olympics and thinking about my Canadian identity, and at
Speaker 1: that point, I'm just cheering from my team, and I
Speaker 1: might make bad bets on the Canadian national hockey team.
Speaker 1: But when I'm thinking through the lens of a professor,
Speaker 1: that comes with a certain set of training and expectations,
Speaker 1: and I comport myself in a different way and apply
Speaker 1: kind of I put on that set of glasses and
Speaker 1: see the world through that lens, and it's a lot
Speaker 1: more critical than my other identities. And so when I
Speaker 1: want to evaluate facts or before I'm going to share
Speaker 1: something on Twitter, you know, among my followers, I might
Speaker 1: want to share something that is consistent with my identities,
Speaker 1: my other identities, but often I catch myself and I ask,
Speaker 1: is there data to support that? And that's basically because
Speaker 1: I realized my professor friends are going to be seeing it,
Speaker 1: and if I share things that are untrue or unfactual,
Speaker 1: they're gonna jump on board. And so that community I
Speaker 1: belong to is very fiercely skeptical, and so you can
Speaker 1: build your own identities and hang out with communities that
Speaker 1: value accuracy, and some of us aren't comfortable. It's very
Speaker 1: threatening and upsetting to be told you wrong, especially in public.
Speaker 1: Does democracy work if we are biologically destined to favor
Speaker 1: law is and we have a lot of lies being
Speaker 1: flung at us by new forms of media and the internet. Yes,
Speaker 1: so democracy assumes that voters are informed and that they
Speaker 1: can determine what their best interests are or the best
Speaker 1: interests of the country and vote. But if they're fed
Speaker 1: inaccurate information, the collective wisdom of the population is going
Speaker 1: to go awry. And that is a huge risk of democracy,
Speaker 1: not just in the US but around the world right now.
Speaker 1: And that's why other countries are having boughts generating news
Speaker 1: that serves their interests and not ours. See, this is
Speaker 1: why markets are better, because it doesn't matter if a
Speaker 1: bunch of people believe lies or it all comes out
Speaker 1: in the wash, right. And so whereas democracy you sort
Speaker 1: of choose one person over the other, in markets you
Speaker 1: converge on a single price, which tends to be more
Speaker 1: or less usually a pretty good price, although there are
Speaker 1: bubbles and stuff like that. You know, I'm thinking back
Speaker 1: to a really old episode we did on the podcast.
Speaker 1: Remember Dr Brett Steinberger, the He's a Trader psychology. He
Speaker 1: was like the real life, the real life Wendy Rhodes
Speaker 1: from billions who went into hedge funds and talk to
Speaker 1: traders about improving. So I'm curious based on you know,
Speaker 1: if you were brought in, if a hedge funder wanted
Speaker 1: to have you teach his traders essentially how to overcome
Speaker 1: their biases, how to overcome ideological ruts that might prevent
Speaker 1: them from seeing the truth in front of them. How
Speaker 1: might you apply what you've learned about sort of ameliorating
Speaker 1: political um uh, the effects of politics to the world
Speaker 1: of markets. Yeah, so maybe I'd come up with a
Speaker 1: handful of tips. The first one is take your ego
Speaker 1: out of it, So take your own personal motives for
Speaker 1: things like status are belonging out of it as much
Speaker 1: as you can, because those are going to guide you
Speaker 1: a straight on average. The next thing is, um have
Speaker 1: a system where you check yourself so when you feel
Speaker 1: like your intuition is to go one way, have some
Speaker 1: system where you wait an hour or a day or
Speaker 1: sleep on it before you make a big trade, and
Speaker 1: so you're able to process more information and make it
Speaker 1: based on analytics. So that also stops you from engaging
Speaker 1: a group thinking going with the flow of things. The
Speaker 1: other things I would say is try to put your
Speaker 1: political ideology out of the equation. And so, as you
Speaker 1: mentioned that happened in the recovery, some people had ideologies
Speaker 1: based on past experiences in the market and and held
Speaker 1: onto those a little too long. So get your ego
Speaker 1: out of it, your ideology out of it. Build in
Speaker 1: a process that allows you to deliberate. And the other
Speaker 1: thing I think to do is to have a process
Speaker 1: where people around you you can call on them to
Speaker 1: be critical of you and create a culture of of skepticism.
Speaker 1: And so I met with the CFO of eBay and
Speaker 1: gave a talk with him once, and he said in
Speaker 1: their c suite meetings they would give a different person
Speaker 1: before each meeting a black helmet, and that person was
Speaker 1: a designated dissenter. And because because descent is really hard,
Speaker 1: especially in groups, because people might think you're trying to
Speaker 1: undercut them or show off or sabotage the group. But
Speaker 1: it turns out people actually care more most about the
Speaker 1: group outcomes are most likely to dissent, but we tend
Speaker 1: to suppress it to go along and fit in and
Speaker 1: to avoid being socially excluded. And so building systems to
Speaker 1: encourage dissent, it reminded me I was. I took my
Speaker 1: daughter to the Natural History Museum recently and they showed
Speaker 1: a mask that judges used to wear some tribe thousands
Speaker 1: of years ago, and it pointed out that the idea
Speaker 1: behind wearing the mask or something is to depersonalize the
Speaker 1: decision so that the judge, so that the it's the
Speaker 1: law speaking and not the individuals. So when you say
Speaker 1: a black helmet creating some visual symbol of this person
Speaker 1: isn't allowed to dissent, I could see how that can
Speaker 1: has a long history of helping to break through and
Speaker 1: make communication better. Yeah. Well that was a fantastic conversation
Speaker 1: and I love this topic. Dr j Van Babel. He
Speaker 1: is the author of a new paper the co author
Speaker 1: of a new paper, The Partisan Brain and Identity based
Speaker 1: Model of Political belief. It's a pretty grim read from
Speaker 1: a future of democracy standpoint. I think this conversation left
Speaker 1: me very down on that front. But look, it can
Speaker 1: maybe have some implications for people who want to make
Speaker 1: money on the market. So that's good, right, Thank you,
Speaker 1: Thanks a lot, Joe. Next Odd Lots podcast, I'm showing
Speaker 1: up with a black helmet and I'm going to disagree
Speaker 1: with everything. I like that idea. You know, what I
Speaker 1: really liked about this conversation is there's a lot of
Speaker 1: people who talk about rationality, and there's a lot there's
Speaker 1: I think there's kind of a cult of rationality among
Speaker 1: certain people, and they people pride themselves and being more
Speaker 1: rational than the next person. But what I like about
Speaker 1: this framing is that it's not that maybe people are
Speaker 1: more or less rational, but it's sort of like a
Speaker 1: meta rationality and so in the sense that maybe it's
Speaker 1: not rational too not acknowledge some certain fact, but maybe
Speaker 1: it is just more rational for people to want to
Speaker 1: agree with their neighbors and that ultimately it just might
Speaker 1: make more sense. Well. Also, particularly in trading, we've talked
Speaker 1: a number of times about how markets can be wrong
Speaker 1: and you can be right, but ultimately you're going to
Speaker 1: lose money on that trade if everyone is going in
Speaker 1: a certain direction and you're trying to fight the tide.
Speaker 1: So that really complicates matters, and it's particularly challenging for
Speaker 1: traders and strategies because sometimes out of consensus views are
Speaker 1: severely punished. Yeah, because there's group think at internal organizations
Speaker 1: such as big investment. First, there's group think all over
Speaker 1: the place. So if you were someone who went long
Speaker 1: Lehman Brothers in September of two eight, uh, you were
Speaker 1: Now you're a complete idiot. But it could have been
Speaker 1: that they were bailed out and Lehman Brothers could be
Speaker 1: worth twenty times what it was then, and everyone say
Speaker 1: this person is a genius. So there's all kinds of
Speaker 1: incentives to just go with the crowd and not take
Speaker 1: the huge risk. Yeah. Absolutely. Can I just say one
Speaker 1: more thing. I'm really into uh anthropology lately, so I
Speaker 1: like this idea that we're going to start looking into
Speaker 1: the evolution of humankind to explain markets. Let's let's let's
Speaker 1: do some more. All right, Um, this has been another
Speaker 1: episode of the Odd Lots podcast. I'm Tracy Alloway. You
Speaker 1: can follow me on Twitter at Tracy Alloway, and I'm
Speaker 1: Joe wisn't Thal. You could follow me on Twitter at
Speaker 1: the Stalwart. Are you on Twitter? I'm on Twitter at
Speaker 1: j A Y V A N D A v E L.
Speaker 1: And you should follow our producer tofur Foreheads at foreheads
Speaker 1: T as well as the Bloomberg head of podcast, Francesco
Speaker 1: Levy at Francesco Today. Thanks for listening.