Arnold Kling  

How Rude

Self-Promotion... Unassorted Links...

Charlie Rose interviews Michael Lewis, and the interview just gets better and better as it goes along. Here are some of the phrases that are used to describe the Outsiders, the money managers who were right about the subprime bubble:

"bothers people"
"socially cut off"
"not hearing the signals"

By the same token, they could not be heard by the Insiders, who Lewis describes by saying "people see what they are paid to see."

In 1999, I was a partner in a Dotcom that I had founded. We sold to a company that went public. At the time, I was profoundly convinced that Dotcoms were a bubble. In effect, selling our company amounted to shorting into the bubble. Meanwhile, while a lot of the proceeds from the sale were tied up in restricted stock (so that we had to hold onto it for at least twelve months), I started my first blog, which I called The Internet Bubble Monitor, to joke about and warn readers (not that there were many readers) about the bubble.

In fact, even before the deal to sell our company was put together, I wrote Arithmetic in a Bubble, which was cited after the bubble popped in Hal Varian's New York Times column (of course, he was one of very few readers).

It is hard for those of us perceived as rude, blunt, and socially cut off to be heard by the financial establishment. It is much, much harder to get our views in play in the political establishment.

I should point out that Lewis spotlights the following quote from Tolstoy, which should please Robin Hanson and Jeffrey Friedman:

The most difficult subjects can be explained to the most slow-witted man if he has not formed any idea of them already; but the simplest thing cannot be made clear to the most intelligent man if he is firmly persuaded that he knows already, without a shadow of doubt, what is laid before him.

Comments and Sharing

COMMENTS (5 to date)
SydB writes:

Wait. Most of the time you're telling us that nobody can predict the future. Now you're telling us that we should all be listening to the rude, blunt, and socially cut off. They're apparently the predictors.

Not trying to be rude, blunt, and socially cut off, but you do realize that you frequently contradict yourself in your blog, don't you?

Count me confused.

Alex J. writes:

You have to be disagreeable in order to be right when everyone else is wrong. That doesn't mean that every disagreeable disagreeing person is right.

Eric H writes:

It is only the rude, blunt, and socially cut off that are willing to try and see the extended order for what it is. Perhaps it is their very nature that allows them to do so.

Being a vital part of the extended order requires one to buy into the order's social conventions. Those that are courteous, diplomatic, and socially connected are less inclined to study the extended order of which they are a part, perhaps because they are expending most of their energy and capital being courteous, diplomatic, and socially connected. Membership in the extended order prohibits one from getting a clearer picture of how the order operates.

Rebecca Burlingame writes:

It seems that the rude, blunt and socially cut off have a hard time changing their stripes as well. Sure, from time to time it's easy to join in the camraderie of the what, me worry? crowd but then it just seems to make more sense to focus on what can be done about the problems and hope someone wants to know while one is still alive!

Robin Hanson writes:

I am indeed pleased. Most rude folks do not see clearly, but those who do see bad news clearly and tell others must seem rude, which reduces the incentive to see clearly. Good for Arnold that he happened to have an easy way to short the bubble; too bad most of the rest of us did not.

Comments for this entry have been closed
Return to top