53 votes

This is financial advice

11 comments

  1. brandt
    Link
    When Prophecy Fails is a 1956 book detailing three social psychologists' study of how members of a UFO cult reacted when their predicted date of the apocalypse failed to materialize. This is the...
    • Exemplary

    When Prophecy Fails is a 1956 book detailing three social psychologists' study of how members of a UFO cult reacted when their predicted date of the apocalypse failed to materialize.

    This is the intro:

    A man with a conviction is a hard man to change. Tell him you disagree and he turns away. Show him facts or figures and he questions your sources. Appeal to logic and he fails to see your point.

    We have all experienced the futility of trying to change a strong conviction, especially if the convinced person has some investment in his belief. We are familiar with the variety of ingenious defenses with which people protect their convictions, managing to keep them unscathed through the most devastating attacks.

    But man’s resourcefulness goes beyond simply protecting a belief. Suppose an individual believes something with his whole heart; suppose further that he has a commitment to this belief, that he has taken irrevocable actions because of it; finally, suppose that he is presented with evidence, unequivocal and undeniable evidence, that his belief is wrong: what will happen? The individual will frequently emerge, not only unshaken, but even more convinced of the truth of his beliefs than ever before. Indeed, he may even show a new fervor about convincing and converting other people to his view.

    They suggest that this phenomenon can occur when five conditions are met. This table from the book's wikipedia article puts it nicely:

    Condition Effect
    "1. A belief must be held with deep conviction and it must have some relevance to action, that is, to what the believer does or how he or she behaves." Makes the belief resistant to change.
    "2. The person holding the belief must have committed himself to it; that is, for the sake of his belief, he must have taken some important action that is difficult to undo. In general, the more important such actions are, and the more difficult they are to undo, the greater is the individual's commitment to the belief." Makes the belief resistant to change.
    "3. The belief must be sufficiently specific and sufficiently concerned with the real world so that events may unequivocally refute the belief." Exposes believers to the possibility of their belief being disproved.
    "4. Such undeniable disconfirmatory evidence must occur and must be recognized by the individual holding the belief." Exerts pressure on believers to abandon their belief.
    "5. The individual believer must have social support." While an individual might be unable to resist the pressure to abandon their belief in the face of disconfirming facts, a group might be able to support each other to maintain the belief.

    That internal reenforcement in their beliefs works like a flywheel of delusion.

    It's been years since I read it, but I remember it being a fascinating read. Here's a link to it on Amazon.

    20 votes
  2. DefiantEmbassy
    Link
    I remember seeing the posts in November 2020 about GameStop, and thinking it was insanity. And then it blew up, and part of me was kicking myself for not getting in on it - albeit, I could never...

    I remember seeing the posts in November 2020 about GameStop, and thinking it was insanity. And then it blew up, and part of me was kicking myself for not getting in on it - albeit, I could never have gotten into it due to a lack of any capital.

    The fact that it continued is insane to me. But the front page posts from /r/superstonk I'd seen clearly hadn't prepared me for the outrageous stupidity within this. Jesus.

    As always, Dan Olson is killing it. Ever since "In Search of a Flat Earth", his videos have just elevated to another level.

    17 votes
  3. Omnicrola
    Link
    Dan Olsen is back with another multi-hour deep dive. Really love his content, I'll come back and comment more once I've actually watched the entire thing.

    Dan Olsen is back with another multi-hour deep dive. Really love his content, I'll come back and comment more once I've actually watched the entire thing.

    11 votes
  4. [2]
    teaearlgraycold
    Link
    I feel like I'm in a rare category of people. With all of the waves of the Internet's favorite "get rich quick" schemes from the last decade I've managed to be involved, maybe even make a little...

    I feel like I'm in a rare category of people. With all of the waves of the Internet's favorite "get rich quick" schemes from the last decade I've managed to be involved, maybe even make a little money, and never get pulled in too deep.

    • Bitcoin - I mined Bitcoin in my parent's basement back in 2010 or 2011. I was "only" mining 2 or 3 Bitcoin per week. In total I mined about $20 worth and spent it on VPS time.
    • Litecoin - Similar deal. Mined about $50 worth and sold to buy computer hardware in 2013.
    • Ethereum - Bought a few ETH around 2015 and sold for a small profit of around $100.
    • GameStop - Bought a few stock option contracts early in the week when it went to the moon. At one point I was making $10,000 per hour. Ended the contracts at +$150,000. My friend that got me in on it said it was going even higher, so when my contracts closed I bought back in. For a while it kept going up and it got as high as $350,000. Then it all came crashing down and I was lucky to get out my initial investment. It was clear it was just memetic pump and dump to me.
    • NFTs - Made my own NFT and got about $50 for the various versions that got minted.

    Really it seems like if you're aware of these things early enough you can consistently make money. You just need to know to quit when you're ahead. None of these ended up making me rich, but I guess I'm better off than all of the people that lost money!

    People still talking about GME in 2023 want to will one of these events into existence. What's sad is they're out there burning their money. The next big "get rich quick" scheme will come around some day and they'll be too bankrupt to have any real shot at it. They're beating a dead horse.

    10 votes
    1. RobotOverlord525
      Link Parent
      Dan Olson made a very similar point when he observed that these people ironically made themselves easy targets for hedge funds and short-sellers. If you're aware enough of the insane cult when...

      Dan Olson made a very similar point when he observed that these people ironically made themselves easy targets for hedge funds and short-sellers. If you're aware enough of the insane cult when it's just gaining steam, you can exploit their predictable irrationalities for profit.

      4 votes
  5. Pioneer
    Link
    Just watched this video and it's a really decent analysis for anyone who hasn't seen the GME madness. I remember it popping off in 2021/2022 and an old colleague of mine was giving me stick for...

    Just watched this video and it's a really decent analysis for anyone who hasn't seen the GME madness.

    I remember it popping off in 2021/2022 and an old colleague of mine was giving me stick for not throwing cash at GME back then. I distanced myself from him at that time (No-one should get grief for not taking advice) and I have no idea what happened, but he's still at his job that he hates, so.

    But the final piece is great. No-one deserves to be grifted, that much is true. But this is just maddening to watch happen to people globally.

    9 votes
  6. Fiachra
    Link
    I remember thinking of the cryptocurrency shitcoin movement, specifically the part focused entirely on getting rich by baiting publicity from Elon Musk, as people with big regrets at having missed...

    I remember thinking of the cryptocurrency shitcoin movement, specifically the part focused entirely on getting rich by baiting publicity from Elon Musk, as people with big regrets at having missed the boat on the Dogecoin boom and trying to recreate it, cargo-cult style. But this video has given me a new perspective on these financial conspiracy theories: the ones most focused on recreating the one-time event aren't just people who missed the boat, they're the ones who bought in too late and got stuck holding the bag. Those are the only people motivated enough.

    So not only did the promise that everyone would get rich off the hedge funds' losses not materialise, but the GME movement has lasted longer because its promises didn't materialise, because the people who lost big turn into true believer nutcases. Also explains why the bitcoin bubble reinflates itself every year or so.

    5 votes
  7. [3]
    RobotOverlord525
    Link
    I just finished it and, honestly, it's a little depressing. I have a sense that he may be reducing them to monoliths a bit too much. The u/[deleted] joke in the end credits is actually kind of an...

    I just finished it and, honestly, it's a little depressing.

    I have a sense that he may be reducing them to monoliths a bit too much. The u/[deleted] joke in the end credits is actually kind of an admission that some people do get out. That there is a bottom for at least some of these "Apes."

    But there are some truly insane diehards, just like there were with Qanon. And with crypto, though the floor hasn't completely dropped out of that.

    These social media cults are so strange. They're like cults with no cult leaders. It's like everyone is both cult member and cult leader at the same time, which is kind of antithetical to the whole idea of a cult. But I just don't know a better way to explain it.

    Dan Olson needs to do a video on the Wellness cult. But I would imagine that is less well represented on Reddit and Twitter as it seems to be more prevalent on Instagram, YouTube, and TikTok.

    3 votes
    1. [2]
      teaearlgraycold
      Link Parent
      What’s the Wellness cult?

      What’s the Wellness cult?

      1. RobotOverlord525
        Link Parent
        It would be things like the fad obsession with oxalate, as described and debunked here. I don't have a random interest in this topic. Unfortunately, I had a family member tell me I had oxalate...

        It would be things like the fad obsession with oxalate, as described and debunked here.

        I don't have a random interest in this topic. Unfortunately, I had a family member tell me I had oxalate poisoning recently as a way to explain my psoriasis/eczema, GERD, and hand tendinopathy. And sadly this wasn't just a one-off, either.

        1 vote
  8. Nemoder
    Link
    I feel like one thing this video didn't really address was the entertainment factor. While I'm sure once the memestock stuff started making headlines lots of people jumped onboard to try to make...

    I feel like one thing this video didn't really address was the entertainment factor. While I'm sure once the memestock stuff started making headlines lots of people jumped onboard to try to make money on it I suspect a huge amount of smaller investors didn't really believe any of the conspiracy garbage. They just wanted to see what would happen for fun and didn't really care about the returns. Not much worse than buying a ticket to a pop concert for them.

    2 votes