Bits and pieces

Some interesting little bits and pieces from around the place.

Trust Barry Ritholtz to nail this:

zombie lie
n. A false statement that keeps getting repeated no matter how often it has been refuted.
Great nugget as always from Barry. I have quoted his ‘zombie bear’ description many times and am happy to have this new ‘zombie lie’ to add to my vocabulary. Loads of examples of both Zombie Bears and Zombie Lies can be found on the Zero Credibility blog (you all know the one I mean).

I’m not a big reader of the mainstream news sites, I don’t have much against them its just that they tend to lag the market and its themes and developments. But this article is great, loads to quote from it, but is best read in full as it highlights the confirmation bias inherent in those pundits with their egos heavily invested in their forecasts, those unwilling to move as the facts change. Bolding is mine.

I’m not saying that all of those advisers who believe another recession is imminent are automatically guilty of sloppy thinking. But many of them are: When the facts on which they base their argument end up changing, they simply look elsewhere to find other facts that support their conclusion.

They remind me of the famous line with which Adlai Stevenson, the Democratic party candidate for president in 1952 and 1956, used to mock his opponents: Here’s the conclusion on which I base my facts.

To be scientific in our approach to the markets, we need to be ruthlessly empirical in following the lead of the data, in whatever direction it might take us, regardless of our preconceived notions.

Finally, a thought-provoking article from Jonah Lehrer:
Does Depression Help Us Think Better?

Thomson and Andrews imagined depression as a way of forcing the mind to focus on its problems. Although rumination feels terrible, it might make it easier for us to pay continuous attention to our dilemmas. According to Andrews and Thomson, the mood disorder is part of a “coordinated system” that exists “for the specific purpose of effectively analyzing the complex life problem that triggered the depression.” If depression didn’t exist — if we didn’t react to stress and trauma with endless ruminations — then we would be less likely to solve our predicaments.

In the spirit of taking a scientific approach Lehrer also states, quite clearly:

It’s an intriguing hypothesis (which is why I wanted to write about it), but the evidence for this “analytical rumination” theory is mostly speculative and indirect. (It’s also worth pointing out that the theory has many critics, who make several important points.)

Like I said, food for thought.

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2 Responses to Bits and pieces

  1. graeme says:

    Double dip is so 2010. When the fed stops printing money then the house of cards will all fall down and the entire financial system will collapse, leaving everyone impoverished except for the people smart enough to buy silver at $50 an ounce.

    Didn’t you here, S&P gave the US a negative outlook. They are heading down the same path as Greece. The fed is printing money to avoid a default. Inflation is being hidden by ‘the gummint’ when they remove food and fuel from the calculations. The government has “manipulated” the recovery by spending money during a recession. Silver margins were hiked to “take down” precious metals and protect wall street. When the fed stops printing money, deflation will rule and we’ll be back in the 1930’s. Because the fed is printing money we will end up like Zimbabwe and will have to get a wheelbarrow to buy a loaf of bread.

    This is all simple, down to earth stuff when you think about it. Sell stocks, buy silver and gold, the result is inevitable!!

  2. fmtrading says:

    Good to have you back Graeme. Yes, the doom is just around the corner, 2012 at the latest I hear. If the black helicopters don’t get me first, that is (or if the aliens abduct me for a good probing).

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