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Anchoring And The Bandwagon
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Anchoring And The Bandwagon

by The MoleJanuary 13, 2017

I’ve been tangentially following the news at a safe distance over the past week and frankly felt tempted to pinch myself every once in a while, just to make sure that I’m not just experiencing some surreal nightmare. And perhaps to take a shower just to be on the safe side. As a rule I have kept political discussions at a minimum here at Evil Speculator in order to stay on mission (i.e. banking coin) and to not pollute the discourse with emotionally charged exchanges. But the current train wreck over the latest allegations involving President-elect Trump and a supposed Russian sex trap involving urination was just too sweet to pass up. Probably not in the way you think however. Rather it serves as a great example of two cognitive biases – anchoring and the bandwagon effect. Both are closely related.

Anchoring

So first of all ask yourself this: What do we really know about this whole sordid affair? Did we see an actual video of what allegedly happened in Russia? No we did not. What we did see were a lot of allegations and hearsay without a single credible shred of proof. And no matter what your political orientation and no matter how much you may wish that it may be true, this usually should be the very moment where you simply fade out the noise and wait for proof.

Unless of course you are professionally involved in this – in which case using it to your political advantage is fair game. Politics is war and if you’re a politically engaged Democrat then you certainly won’t miss out on an opportunity to smear or discredit a person you believe is the next anti-Christ and a disaster for America. And clearly if you’re an active Trump supporter then your job is to fight these allegations tooth and nail, or perhaps even use it against the opposition.

And yes, I get it. For many of you arguing about politics is not only a passion but also a release from many of the frustrations and problems you may be experiencing in your own life. But it’s important to always remind yourself of how all this is affecting you as a person. Ask yourself how clickbait like this may be anchoring you into thinking patterns which may easily be exploited by outside parties. Also ask yourself how pressing your emotional buttons may affect your own discourse with people who oppose your core beliefs. Does it make you more angry at them? At minimum spending time immersing yourself into the subject is a personal investment you will have to justify. Because it is time you could have spent improving yourself, enriching the lives of your friends and family, or just simply working hard to get yourself into a higher tax bracket. Always remember, if you’re not paying for it then you’re most likely the product.

Anchoring is a very devious practice which apparently seems to have been perfected to a science by social media outlets and most recently the mainstream media. You have to realize that by exposing yourself to a carefully crated set of information you are being effectively anchored into particular thinking patterns that will later affect your personal decision making process. It may even create psychological stress which on a long term basis may lead to a whole host of physical diseases. Even worse, it actually opens you up for mental manipulation in other areas that affect you professionally, trading of course being one of them.

I admit that it’s extremely difficult to resist anchoring and it takes constant practice and mental discipline. If I tell you to not think about an elephant and a mouse right now then it’s most likely exactly what you’re envisioning in your head. That’s how easy it is. And suddenly we’re thinking about elephants, feisty rodents, and who knows what else – it’s a slippery slope.

The Bandwagon Effect

So why are we even talking about Trump and sex tapes in the first place? Because everyone else is, that’s why. But who started it and why? Maybe there really is fire because there appears to be smoke. After all everyone seems to be believing it – are are they? Or is someone simply crying wolf to further a particular political agenda? The latter may be unfair or morally detestable but we all know that life ain’t fair and there are no rules in love and war. Politics is a full contact sport and nobody cares about the losers. Who again ran against Bush and Clinton in 1992?

It was Ross Perot – who by the way put up some really cool charts! But you get my point. When it comes to controlling the most powerful political position on this planet things have a tendency to get dirty and there are no second winners. Discrediting your political opponents is the name of the game and until society as a whole evolves toward a more enlightened median there’s nothing we can do about that.

But what we can do is retain control of our own thinking process. Because it’s effectively being highjacked on a constant basis without you even realizing it. Especially in the mainstream media as well as in the financial media. Just because everyone is talking about something does not necessarily mean that it is true. Unless of course it has been proven without doubt. So next time you come across some juicy headline the best thing you can do for yourself is to simply ignore it. Because if there is actually any proof available at the time then you can be damn sure that it’ll be mentioned right below that headline. Which actually makes controlling what you let past your mental gate surprisingly easy.

So next time you come across some headline that Trump or Clinton or anyone else you are supposed to care about is engaged in some depraved sexual activity simply look for unequivocal proof accompanying it. If there is none and all you see is a wall of text then it may be better to devote the next ten minutes of your life more productively. I promise that you won’t be missing out on anything.

Evil Speculator Rule #467: Life is short – don’t waste it on rubbernecking. 

Evil Speculator Rule # 532: Control your mind or someone else is going to do it for you.

 


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at various social media waterholes below.
  • Yoda
  • http://evilspeculator.com Sir Mole III

    Guten Morgen.

  • Yoda

    Gluten a bend to you Sir. May the bots leave our stops in peace.

  • kim

    are you guys short? :)

  • evilasevildoes

    no trades?

  • http://evilspeculator.com Sir Mole III

    MLK day on Monday – I’m not doing much today.

  • http://evilspeculator.com Sir Mole III

    I’m about 6′.

  • evilasevildoes

    Enjoy the weekend Mole and Mrs…….looking like DB is up this morning……

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    an elephant, mouse, and full moon.
    well, the full moon was 24 hours ago.
    close enough for gov’t work.

    http://data.whicdn.com/images/61569173/original.jpg

    and to be a spelling nazi, it’s carefully crafted not crated.
    😉

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    I’m on a Guten free diet.
    =P

  • http://www.captainboom.com/ captainboom

    Excellent points Boss. I recently attended a lecture on The Revolution in Neuroscience, which was well done, and fascinating.

    http://www.cfimichigan.org/events/event/w-lecture-011117/

    I took some photos of his slides as reference. He commented that there was a ‘dark side’ to some of this, and one of his slides stated:

    Manipulating People
    – ‘Neuro-marketers’ are putting people in scanners to test the response to advertisements.
    — Brain scans, facial expressions, skin conductance and pulse predict response.
    – Political consultants are doing the same thing

    You can bet Wall Street is doing this, and I suspect we will be beholden to our new robot overlords in more than just the trading arena.

  • http://evilspeculator.com Sir Mole III

    Jeezes – I heard that this was being researched but I wasn’t aware how prolific the practice had become. That’s scary to the max.

  • http://www.captainboom.com/ captainboom

    Yep. Scary indeed. The lecturer indicated that political parties had used these methods in the recent US election. Wouldn’t surprise me if it’s done by all of them.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • http://evilspeculator.com Sir Mole III

    Absolutely it is. The only way to win is not to play – which means keeping your mind insulted as much as possible. Nobody is immune.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    BTW, I *did* finish a bathroom remodel job this past month.
    No, I didn’t go for the gold plating option.
    😉

    http://cdn3.volusion.com/jrdvt.kykgn/v/vspfiles/photos/Gold-Plated-Showerhead-BST039G-2.jpg

    I suppose I’m anchoring in a clever fashion.

    Slippery slope, was that a pun?

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    ..on a more serious note.
    It’s Friday, I don’t do Market entries on Friday.
    Doubly so before 3-day U.S. weekends.

    The QQQ’s refused to roll-over yesterday. (BTFD I guess).
    Safety will be prosecuted today, (metals, bonds, etc)
    I have today off. and a list of to-do’s delayed during the Year-End.

    Cheers!

  • Yoda

    Yes and yes

  • Yoda

    There is something fishy about the open: look at how high the TRIN is

  • Tomcat

    Bonds are being taken to the woodshed… ES is flying higher…everything is GREAT again.
    I have a feeling (and a bet) this will all reverse come inauguration day.

  • Tomcat

    GG,

    A golden bidet is a must!!!

  • ridingwaves

    ok…now I need to get out of the city into some eastern Oregon small town….this is nuts….check this out for more mind control forthcoming

    cash will be a ghost sometime soon in the future…

    http://norberthaering.de/en/home

    we are behind India’s big cash seizure…

  • ridingwaves

    JPM beat on earnings this AM, financials can almost hold up SPX thru that day as their will be a slew of earnings reports next week also…I will keep in eye out for any noticable XLF weakness, that might be where a short will work

  • ridingwaves

    AKAO is just killing it….small float, mentioned here at $5….

  • StockTalker

    Smells badly

  • BobbyLow

    I understand that the NYSE is closed on Monday but are Futures as in Crude open as usual?

  • Tomcat

    I am pretty certain all US markets are closed.

  • http://evilspeculator.com Sir Mole III
  • BobbyLow

    Thanks. I checked a little further and I believe the CME is open. Whenever I look at CME and or ICE Schedules they always appear a little fuzzy to me. I think the only days that they are totally closed are Christmas Day and possibly New Years Day.

    My main concern is to be holding a Short Crude ETF and have Oil rocket on Monday and not be able to do anything about it until Tuesday. So I’ll probably close this position by the COB today.

  • StockTalker

    signal breaking down

  • Yoda

    Thar she blows

  • StockTalker

    Future have abbreviated hours

  • Tomcat

    I hear you. Which is why I covered part of my crude short.

  • OJuice

    referring to…

  • Yoda

    tape

  • BobbyLow

    I’m glad you said “covered part of your short” because I was struggling with taking all of my short position off. So I changed my mind and only took 1/2 off at BE so I’m holding on to the other half of my short over the weekend. My system is still calling for short crude and yesterday’s follow through on Weds Bump up has fallen apart. So for me, it’s worth a shot to hold on to a 1/2 position.

    I’m also holding my Long TLT because this morning’s drop has a “we were only fooling” look to it.

  • ridingwaves

    one thing in your favor BL is that 11/30 gap up… it would be a good target for the shorts to cover…..and it sticks out like a sore thumb….gaps have been getting covered in lots of sectors over last cple mos. or maybe I’m seeing things…

  • BobbyLow

    What you are saying makes sense. Crude jumped over $4.00 that day. I think that was when Opec said they had a “firm” agreement to cut production. Fortunately I had a buy signal on 11/16. :)

    I have no idea where price is going to end up. I don’t trust anything Opec says or what the EIA says either so I guess we just have to follow price.

  • Yoda

    well I guess the “boys” have decided otherwise and nail the tape at the high.

  • ridingwaves

    Junior miner play for the gray mare freaks….VGZ
    the GPL gap that I wrote and posted a chart about 2 months ago….played out though it took longer than expected.
    thinking this could play out the same….of course dollar and silver itself will have to play along….
    today the 20,50 and 100 sma’s are all bunched up…I’m long here with .90c stop….if it goes below it could go to .71….my target is 1.55-60

    https://s30.postimg.org/6g0tulp7l/vgz_gap_fill.png

  • rmwaddelljr

    Bravo for this article! Not because of the political example, although true in every way; rather, as a purveyor of ill gotten gains, these biases and others are the main reason for retail and professional failure. In most Market Wizards’ experiences (first time around the block), how many blew their accounts? Why did they do so? The most difficult adversary we face is ourselves. It’s true in every arena, including my own (note the pix). My motto: Practice until you can’t get it wrong! Not: Practice makes perfect (not if you practice imperfectly) :)

  • Ronebadger
  • http://evilspeculator.com Sir Mole III

    Practice until you can’t get it wrong.

    I like that one. Thanks for posting that. In martial arts they tell us that it takes 10,000 repetitions to properly learn/understand a technique. However as you stated already, it’s important that you practice the right thing because wrong/detrimental patterns can easily be internalized as well. Which is why men of the past instinctively sought out renowned masters to learn their craft.

    Absent such a master it takes a highly developed sense of objectivity and focus on results to extract any lasting knowledge. The scientific process still espouses that process to this day but it is increasingly being diluted by a focus on feelings and concerns over fairness.

  • Mark Shinnick

    Non-responsibility values; the encroachment of growing ignorance upon scientific reason; the inverse of Renaissance.

  • http://evilspeculator.com Sir Mole III

    Happy MLK day everyone!

  • http://evilspeculator.com Sir Mole III

    “We all have to decide whether we walk in the light of creative altruism or the darkness of destructive selfishness.” – Martin Luther King

  • Billabong

    Also, too many on one side … spec shorts on long bond…

  • Billabong

    It can also go the other way like Saudi announcement on tapering the production cut within 6 months…

  • Mark Shinnick

    Simple;Awesome

  • http://evilspeculator.com Sir Mole III