7/16/2009

Why do conspiracy theories work


Why did the market go up yesterday?
Oh it was the PPT at work

Why you should not trust the employment figure or inflation figure?
Oh the govt manipulates them

What causes bubbles in market?
Goldman Sachs

Why are gold prices down?
Oh the govt manipulates the gold prices.

If you look around in the market , you will see such conspiracy theories all over the place. We have become a nation of conspiracy theorists. Everything is a conspiracy according to some people.

Where do such conspiracy theories come from and why do they work? Understanding them can make you a better trader.


  • There are leaders and followers
  • There are good leaders and there are bad leaders
  • Every leader has a agenda.
  • Some leaders have positive agenda some have negative agenda.
  • Leadership is about :
    • ability to "attract" followers
    • make followers "believe" in certain things
    • prevent other leaders from "poaching" followers
    • take followers from point A to B "willingly"
  • Mental model manipulation is at the heart of successful leadership
  • Autocratic leaders control,followers by use of force. But that is coercive leadership model where the followers are not "willingly" following "the great leader".
  • Leaders manipulate followers mind using communication.
  • Positive leaders change followers mind using rational and positive messages.
  • Negative leaders change followers mind using conspiracies and irrational arguments.
  • Behind every conspiracy theory are leaders who are trying to get "willing" followers.
  • Most people are followers.
  • There are very few leaders in the world, but there are vast number of followers.
  • Big and consequential changes happen in the world, or in a company, or in your life if you come across good leaders.
  • If you study history, you would see that every big change in the world was bought about by a good leader.
  • There are many failed leaders in the world. In the absence of good leaders they attract followers using mental manipulation.
  • Conspiracy theories are very good way to attract followers.
  • Conspiracy theories can explain in simple terms things to followers.
  • Powerless followers love conspiracy theory because it allows them to rationalise their failure and externalise the problem. They create a complex web of conspiracy theories to explain away everything. If you try and expose their logic with rational thinking and arguments, they will throw more nuanced conspiracy theories.
  • The conspiracy theory proponents have their own rules of economics not proven by any existing economic theories. They are pseudo economists.
  • Religions, cults, political parties, labor leaders, media commentators and so many other people with access to media use conspiracy theories very skillfully to "attract" and "retain " followers. Scratch deeper when you hear somebody propogating a conspiracy theory and you will find a leader trying to influence you. That person has some motive for it.
  • If you want to understand how to manipulate minds study either religion or advertising.
  • Both the disciplines use simple communication tricks to " influence" and "change" your mind. They do it with velvet gloves and leave no finger prints behind.
  • If you do not control your mind, there are several outsiders waiting to influence it.

Why is understanding how conspiracy theories work is important to trading, because you trade what you believe. People trade their beliefs, not necessarily what will make them most money. Classic example of that are gold bugs and perma bears.





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Do you have a trial?

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To sign up go to www.stockbee.biz and follow the sign up process. The site uses Paypal for payment processing.

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