A little over 8 years ago I started writing this blog about the financial crisis. The website became surprisingly popular and within a few months was generating millions of page views per month. It was a scary time and I noticed an obvious trend in my writing – writing about scary things attracted a lot more attention than anything else. But as the years unfolded the world became less scary to me. By 2010 I was fully in the “recovery” camp and trying to explain why the world might not be as bad off as some thought. It was not a well received view at the time and I often felt like I was pushing a boulder up a hill.
It was around this time when I was on a sort of personal crusade to discover the truth of this monetary world. I was among the first (maybe the first?) to debunk many myths in real-time – QE doesn’t cause high inflation, the USA isn’t going bankrupt, the US Dollar wasn’t going to crash, interest rates don’t increase due to government debt, etc. I tried to approach all of these things from an operational perspective. My basic thinking went something like this – I know I am politically and behaviorally biased so I can’t approach these things emotionally. Therefore, I must be operational. I have to think like an engineer. That means understanding the world for what it is and not for what I want it to be. I wrote some popular papers and a book outlining my general views, but they never gained that much traction and that never surprised me. After all, they’re more like owner’s manuals than fictional thrillers. They’re dry, boring and emotionless. My work is far from perfect, but it’s about as far from emotionally driven ideology as you’ll find in finance and economics.
But it was also during this time that I made a more important promise to myself – I promised that I would never sell emotion in exchange for page views and notoriety. I refused to sell fear despite knowing that it would garner more attention for myself. I believed at the time that I would garner greater credibility and provide greater value if I provided the right view instead of the emotionally biased view. But I am beginning to think that I was wrong. I am beginning to think that most people just don’t care about the truth and the facts.
Interestingly, the facts support this view. It’s now become clear that people don’t really care that much about the facts or the truth. A Rutgers University survey recently found:
“The general public has extremely little factual knowledge of the contours of the American labor market or the relative presence of immigrants in the United States. They vastly overestimate the size of union membership in the nation, the current unemployment rate, and the number of foreign-born individuals that make up the U.S. population.”
A University of Chicago research paper recently found that 50% of Americans believe in conspiracy theories. I see it every day in financial circles. But how is this possible? How do the conspiracy theories about hyperinflation, crashing dollar, the unemployment rate, etc. persist when we have almost a decade of real-time data showing us that these theories and myths were totally and completely wrong?
This is crazy stuff. Especially when it comes to the economic data. Americans are distrustful of government data, but the USA has the most transparent and expansive government data sources of any government anywhere. I know because I’ve tried to compile economic data all over the world and no government comes close to the degree of transparency and sheer quantity of data. Is it perfect? Of course not. But it’s abundant and much of it is confirmed by private sources. Still, the post-factual world persists.
It’s crazy to think that more information is making us less informed. But that seems to be the path we’re on. And I suspect the reason for this is that the truth is not what people are seeking out. After all, it’s easier to confirm what you think you already know than it is to learn and accept something you don’t already know. And given the abundance of sources on the internet people have tended to find their news and information where it most conveniently confirms what they think they already know.
Anyone on a quest for the truth is failing (big league or bigly, whichever you prefer) as they’re being drowned out by the con-artists, liars and conspiracy theorists. Sadly, the more we engage these people the more powerful they become. And the more they will tear open the divide that has gotten us here in the first place. The optimist in me hopes we can come together and find more common ground in our views, but the realist in me thinks we are likely to drift further apart as the post-factual propaganda machine wins over the emotions of its inherently irrational audience.