Monday, May 16, 2016

Everybody is Lying - A New Opportunity

If you approach any given problem, politics, economic, medicine, education...  the problem is everyone is lying.  People know it, and no longer trust the hegemon, hence the outlier (pun?) candidates.

I was speaking with an int'l banker of a top-notch bank and to my question as to what degree negative interest rates affected his work, he replied in effect nothing compared to the fact everyone is lying.  The facts used as a basis for loans are lies, so making loans is hard.  Well, that same bank is now state's witness to avoid prosecution on gold price manipulation, a form of lying.

Back in the 1970s I was radicalized on medicine by my godfather, and MD, who kept pointing out the science was fraudulent on medicine.  What about the watchdog, the FDA?  Regulatory capture: the regulators are owned by the regulated. He is now deceased but this would not surprise him:
“It is simply no longer possible to believe much of the clinical research that is published, or to rely on the judgment of trusted physicians or authoritative medical guidelines. I take no pleasure in this conclusion, which I reached slowly and reluctantly over my two decades as an editor of the New England Journal of Medicine.”  – Dr. Marcia Angell, a physician and longtime editor-in-chief of the New England Medical Journal (NEMJ) (source)
and this...
“The case against science is straightforward: much of the scientific literature, perhaps half, may simply be untrue. Afflicted by studies with small sample sizes, tiny effects, invalid exploratory analyses, and flagrant conflicts of interest, together with an obsession for pursuing fashionable trends of dubious importance, science has taken a turn towards darkness.”  – Dr. Richard Horton, the current editor-in-chief of the Lancet – considered to be one of the most well respected peer-reviewed medical journals in the world. (source)
Yes, we are all on our own.  We are now living in chaos, and the only route out is to escape to anarchy. Self-employment is anarchy, properly understood, for you serve yourself best by serving others best.

So what is the opportunity? let me go back thirty years when I was pursuing a master of arts.  My program obliged me to take a statistics course, something to dread.   The professor announced the first day it was absurd that we would learn statistics in one semester, so instead of teaching us to do statistics,  he'd teach us to be consumers of statistics.  He teach us to test the study, spot failures, look for valid and reliable, in essence when it was science and when it was junk.

Now, at the time there was a database called ERIC, in which resided any educational research that mattered.  The term paper was to find an example of science in that database and test all of the elements of the study, demonstrating we students knew good work when we saw it.  Well! by the end of the course, I was into a dozen studies all of which quickly failed to meet the test, so I visited the professor with the complaint that I could not find any science, so far it was all junk.  He had the most wicked grin on his face.  He replied, "That's right, it's all junk. You passed."

I'd say another problem with lending credit is truth does not matter, since there is no rational limit to what you can "fund."  The hegemon can fund it all.

You win a gold medal by 2/10ths of a second.  In the next 40 years, the ability to spot BS will be a decisive factor, and the ability to spot science exponentially valuable.  If we return to benecredit (interest-free, asset-based vendor financing), you'll only be funded if you are accurate.

The professor who taught the class has long since retired.   I certainly cannot teach his course.  If anyone knows of a good stats teacher who wrote a book of teaches online, I'd be delighted to promote him on this blog.  If you are expert and want to deliver a course through schools noncredit, I'll send you a book on how to, gratis.

Prerequisites to business start-up:  Ogilvy on advertising and statistics as a consumer.

Feel free to forward this by email to three of your friends.


Luke Avedon said...

I like the old book "How to Lie with Statistics" by Darrel Huff.(

Per everyone is lying:

Perhaps why honesty is such a good 'Unique Selling Proposition.'

Best, Luke