Moral Outrage
Whew! God help us!

Bankers and politicians lie 93% of the time

Behavioral science tells us that bankers and politicians are lying to us 93% of the time.

So it’s 13 times more likely Wall Street is telling you a lie than the truth.

One of America’s leading behavioral finance gurus, University of Chicago Prof. Richard Thaler, explains: “Think of the human brain as a personal computer with a very slow processor and a memory system that is small and unreliable.”

That’s why they win. Why we lose. Our brains are pre-programmed to cooperate in their con game.

Barry Ritholtz, the financial genius behind “Bailout Nation,” recently summarized it in the Washington Post: “Humans make all the same mistakes, over and over again. It’s how we are wired, the net result of evolution.”

Humans have something “akin to brain damage,” says Ritholtz. “To neurophysiologists, who research cognitive functions, the emotionally driven appear to suffer from cognitive deficits that mimic certain types of brain injuries.

“Anyone with an intense emotional interest in a subject loses the ability to observe it objectively: You selectively perceive events. You ignore data and facts that disagree with your main philosophy.”

[Excerpt of a MarketWatch article]

Advertisements

2 Responses to “Bankers and politicians lie 93% of the time”

  1. Re: POLITICIANS – The St Petersburg Times of Florida and Congressional Quarterly of Washington, DC created http://www.politifact.com, a fact-checking website that helps voters separate fact from fiction in claims made.

    The PolitiFact team checks the accuracy of speeches, TV ads, interviews and other candidate claims and communications, rating them on the ‘truth-o-meter.’ In the event that a politician should, shock-horror, make a u-turn on a particular policy.

    It ain’t pretty.

  2. Re: BANKERS – Analysts miss projections 80% of the time, a huge failure rate. So why would anyone listen to them?

    Because it’s part of the game. The analysts who estimate various stock earnings are doing so because they are in the universe of stocks they analyze and recommend buy-sell-hold.

    In over 90% of the cases, Wall Street analysts have “buy” recommendations on the stocks they follow.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: