Contrast misreaction tendency

Definition

Contrast misreaction tendency can be defined as: ”Making wrong conclusions from an obvious difference between two or more things.”

Your brain is a contrast-detection machine

Imagine yourself living 50,000 years ago. You are a hunter-gatherer and you search food in the jungle. Everything looks and feels normal until you notice some sudden movement on the tree close to you. At the moment this happens, all your efforts and attention go to recognizing the source of the movement. This time it is a harmless bird, but it could have been a poisonous snake or some bigger predator. Your brain is scanning contrasts in your environment. It hasn´t really changed in these 50,000 years. Sometimes contrast can lead you to wrong conclusions. Majority of decisions you make because you detect a contrast are right. And majority of these decisions are irrelevant.

Your nervous system doesn´t react to scientific units. Instead, it relies to something much simpler. It relies to differences that are noticed by your senses. You need to have a point of reference, when you are noticing the contrast. The difference between this point and the other point you compare it with is the contrast. The difference between point of reference and the compared point can be anything. You can find contrast between anything like numbers, items, sounds, colors, etc. Without significant difference, contrast is not established. The difference also shouldn´t be too big.

Contrast can be a good or a bad thing

You can use contrast to your advantage. When you need to use some item daily, you can increase its availability to you by putting it to place where the contrast between the item and its surroundings is noticeable. By increasing the contrast between the good things and their reference points, you can make good things more available. You can also put an unwanted item to a place in which there is no contrast between the item and its surroundings. You can also make things more valuable this way.

Deterioration to bad health can happen gradually. Weight can be gained slowly. Gaining few extra kilograms every year. After a decade you start to have problems with your health. Sometimes changes happen fast. For example, magician can put you on a pedestal that moves really slowly around. Then they can make some item disappear, because you haven´t noticed any contrast between the position in which you were when the movement started. Many salesmen use contrast into your disadvantage. For example, real estate brokers can show crappy houses on sale first and then proceed to the descent house. The latter house looks much better than it would look without showing the crappy ones. Anything can be made to look more valuable by doing this. Sometimes you do it to yourself without knowing it. It is hard to protect yourself from it even when you know in advance that contrast will exist.

Rejection then retreat technique is a combination of contrast misreaction and reciprocity

Rejection and retreat technique is simple. For example, a representative of a charitable organization first makes a request he is sure that you refuse to comply. Then he makes another much more reasonable request. The difference between these requests is big. For example, he asks a donation of 100$ first. After your refusal to this request he asks 5$. The probability of you complying gets much bigger than it would have without the first request. There is a fine line between a functioning difference and nonfunctioning difference. If the first request is too unreasonable this tactic backfires. The reason why this tactic will likely succeed is that a person who gets the first request feels responsible to reciprocate by complying to the second request after rejecting the first one. The second reason is that this person also feels like he was the person who had all the power.

How to avoid the effects on this tactic on us? Doing your homework before you go buying stuff and saying to the salesman that you are looking for a particular item could reduce the effect. There are no guarantee it works. You can also be the person who initiates communication by saying you are not interested without listening any requests. Sometimes these requests are so surprising that it is impossible to prepare for them.

And like with other biases, we have different ways of dealing with contrast. Some people have bigger probability of suffering more from contrast misreaction than others. What you should do is follow your behavior in different situations and make at least mental notes for how you behave.

Sources:

Influence, Robert Cialdini
Poor Charlie´s Almanack, Peter Kaufman

-TT

Reciprocity rule

Definition

Reciprocity rule can be defined as: ”You should try to repay, in kind, what other person has provided to you.”

Reciprocity works because of the feeling of indebtedness

When you get a favor, present, invitation or some other action, you start feeling you are in debt for the person who did this for you. It is a natural reaction. You can´t help it. It won´t happen all the time. It is only more probable reaction. If you break this rule of giving back to your helper, it can backfire, when you have the biggest need for another one. In modern society, it is not always necessary. When the survivability depended on the other people, it was obligatory to return the favor. Because most of your brain functions are from that period of time, this reaction is hardwired into your brain. The feeling of indebtedness is less likely to be born, when the repayment is asked by the person who is producing the favor. The obligation to receive a favor is the main motivator in this rule. It reduces your ability to choose whether you want to be indebted or not. Or to choose to whom you want to be obligated to repay.

This act of giving a favor, present, or other thing doesn´t need to be wanted. You don´t really have to want anything to feel indebtedness. The pure act of someone doing something for you can be enough. The similarity of the favor given in return is the key. If you are not able to give anything similar in return, reciprocity rule doesn´t work properly. The obligation to return the favor diminishes. Sometimes it totally disappears. You can produce the need to repay a bigger favor by producing a small favor first. Free sample is a way to use this rule. A small and free sample is given to potential customers in the hope of getting a bigger response from them. A free piece of bread is used to sell the whole loaf of bread. This piece of bread is a gift and it can create a reciprocity effect. Commercial products have smaller effects than real favors. Some concession professionals like salesmen can also ask a big favor from you that they are sure you are going to decline. Then, they will ask a smaller favor. By requesting something big first, they create a possibility for themselves to reciprocate first. In reality, they are aiming for the smaller favor all the time.

Reciprocity rule is stronger, when external and internal pressure are combined

A group of people do not like to see person´s who are not willing to reciprocate. They are disliked by the group. Sometimes they are even discarded from the group. This doesn´t happen if group knows that person is unable to repay the favor for some reason like a special circumstance or capability. All the favors within the group should be repaid. If it is not possible to act completely in a similar way, another way that is close the initial favor should be applied. Attacking the person who does the favor is a worst thing you can do in a group. Combining this external pressure to produce a repayment with an internal pressure makes reciprocity effect more powerful. This rule creates concessions in two ways. First, it creates an internal pressure to respond in kind. Second, it is the obligation reciprocate a concession by applying external pressure from the group to comply with the request to reciprocate.

Preventing reciprocation rule for not happening

First I would like to say that this rule is good for the world. It is also good for you, most of the time. Sometimes it works against you and these occasions should be avoided. You cannot avoid all of them, but you can diminish their effects. The best way to avoid the bad effects of reciprocity rule is to prevent the activation of it. Best way to do it is avoid all the possibilities of this happening. Sometimes you know in advance that you are going to get an unwanted favor. For example, some selling situations work the same way all the time. These situations can have the same sequence of events. For example, notifying the requester in advance that you have no time for anything else than doing the thing you are interested in.

In theory, rejecting the initial response may be enough. However, in practice, it is harder to avoid this effect this way. You also have to probably add something to your response to prevent the chance for other questions. For example, ”I am not interested in giving 100$ dollars for charity or any money at all.” There are many situations in which you know in advance that they use favors for getting what they want. At least here in Finland, they offer you some coffee and something with them in order to make it easier to comply their requests while they are selling something. In my own life, I have mostly been in a situations where some investing brokerages or marketers have done this. You can make a decision in advance that you will be there only for the coffee. This makes it harder for the requester to make you comply to their request.

As with all the other biases, reciprocity effect works better when it is combined with others. One of them is a contrast misreaction tendency, which is a topic in the next week.

Until then,

-TT

Simplifying through elimination

Most people want more friends, more money, more items, and more everything. Most often, this is the hardest way to improve. Eliminating the unnecessary things from your life is probably easier for you. It benefits you as much as focusing on the most important things. Addition is much easier than elimination. Most often, your outcomes suffer through addition. It is more probable that eliminating things will improve your outcomes.

Elimination is hard, because world gets complicated all the time. You have too many tasks, people, and clutter in your life. The amount of all the things in your mind, at home, and at work is enormous. Most of them are useless. Even most things in your laptop and in your smartphone are useless. You waste your most important commodity, time, to these useless things. And even most people in your life have negative influence on you. You waste your time with them. All the useless things just make your life more complex. If you want to have a simpler and more enjoyable life, you should reduce the amount of things in it. You may have to hurt somebody´s feelings. You have to pay the price to get better outcomes in your life. But it is worth the effort.

Eliminating unnecessary tasks

You waste time by doing the unnecessary tasks. You cannot eliminate all of them. You should then consider delegating them to others, automate them, or minimize their bad effects on you. You have a limited amount of time during the day. And you have even more limited amount of best hours during a day. You should use these hours for the most important tasks in your life. To make sure this happens, you should eliminate all the unnecessary tasks or transfer them to worse hours during your day. Unnecessary tasks have some common characteristics:

• Tasks you don´t like
• Tasks you are bad at
• Tasks that are always interrupted
• Tasks that are not necessary for your life or your career
• Tasks that have done the same way for decades
• Tasks in which your colleagues are useless or unreliable
• Tasks in which the schedule has erupted and the end is not in sight

You can probably define more characteristics for the unnecessary tasks. Everybody doesn´t have the same list of characteristics. Instead of believing in my list, I encourage you to consider your own one and taking necessary steps to diminish their effect on you.

Getting rid of unnecessary items

You have thousands of different items at your home. These items have some costs you probably haven´t thought about. They cost you time, space, effort, mental bandwith, etc. You may even have a garage or some warehouse space for your unnecessary items. You will probably think they are worth more than they actually are. You can probably get some money for them or some favors by giving them to someone else, but that makes your life more complex. All these items have some common characteristics:

• You haven´t used it for a while
• They take too much space
• Their maintenance costs are high
• They were gifts you hate
• They are too difficult to use

It is not easy to let these items go from your life. You may hurt somebody´s feelings, etc. Keep things simple when you get rid of these items. Start with one item that is easy to get rid of.

Eliminating people from your life

Your brains are not designed for having too many people in your life. Some anhropologists have come to conclusion that people can have between 150 and 250 relationships in their lives. The amount of close relationships is much smaller. You should eliminate as many bad relationships as possible to make room for the good ones. There are some common characteristics of bad relationships:

• They drain your energy
• Only one person gets all the benefits from it
• Meeting them is no fun for you most often
• You don´t trust the other person
• The drama is always present in this relationship

Relationships are probably harder to eliminate than unnecessary items or even tasks. You can even have some close relatives that have a bad and uncorrectable relationship with you. You can have friends you have known since childhood. You cannot change others. Therefore, the best way is probably to have some distance from them. Social skills are not my thing. I am bad at them. Therefore, you shouldn´t really believe me. Think yourself and have your own conclusions.

It is harder for you to eliminate things in your life. Whether they are tasks, items, or people, your ego reduces your willingness to get rid of things. You believe that your tasks, items, and people in your life are more valuable they really are. It happens to everyone. My texts are more valuable to me than for the rest of the world, even though it is hard to believe. Simplifying life is beneficial for everyone, maybe except kids. Simplify your life and enjoy better outcomes!

-TT

Anglo-American long term cycle, part 4 Crisis era

If and when Howe and Strauss were right, things could escalate to the full-blown Crisis. Current cycle is in a Crisis era. You can see many commonalities between the era we live now and the era in the end of 1930s. It is possible that all the things happening now are just random noise and I, Howe and Strauss are wrong. Investor Ray Dalio also sees things as we do. World is about to go into the climax of a Crisis era.

The anatomy of a Crisis era

Crisis era lasts normally something between 15 and 25 years. Once has it been very short. This happened during the Civil War in the US. Era starts with a catalyst or catalysts. It can be a burst of an economic bubble, like in the 1929, a Civil War, a declaratio of independence, or some surprise in general election. These catalysts change the mental state of the majority in a country. It can happen suddenly or slowly. Normally change starts from one to five year after the catalyst. Society starts determining itself differently along the period of time. People are more interested in developing institutions than themselves. They start repelling individuals who are more interested about themselves than the community they live in. Some people may start destroying the assets of the rich people. In this era, the differences in the incomes between the rich and poor are the largest. Culture and technology are used for strengthening the behavior for the common good.

Protecting society from the new threats takes over. Problems are exaggerated. When these problems are trying to be solved, the problems get bigger. These solutions are simple and demanding. Instead of solving the reasons for the problems, people focus on the symptoms. Leaders use institutions to solve problems in the society. Leaders are bad during the Crisis. People still believe them and their solutions. The role of a family grows in society. Social interaction grows too. Cooperation is based on survival, not fairness. Some people and generations need to sacrifice their benefits for the common good. This can lead to a division of labor among the gender and age. Children are overprotected compared to adults and women are overprotected compared to men. The promises made about the well-fare of people before the Crisis won´t be kept. It becomes impossible.

During the climax of the Crisis, the role of the people is the strongest. The rage in the individuals has transformed into rage of the community. Protectionism and xenophobia are strongest. The probability of wars is highest. If they are fought, there could be a bitter end with extensive destruction. The probabilities for Civil Wars and revolutions are highest during the climax. Politicians have bigger moral rationales for destroying the enemy than normally. They have no room for compromises in their minds. Common people want an utter destruction of the enemy. Climax of the Crisis is society´s counterpart for nature´s earthquakes and floods. The destruction creates the change in society. It can be good or bad. You cannot know it beforehand. Climax normally happens from one to five years before the end of a Crisis era.

Commonalities between today and 1930s

The catalyst of the former Crisis era concluded in 1929, when the stock market crashed. You can also see that financial crash 2007-2009 concluded this Crisis. Finally central banks had to print money because they had no other way of solving the financial crisis. In the 1930s, there was a Great Depression. This financial crisis was a Great Recession. People didn´t suffer financially as badly as in the 1930s. The recover was faster this time. This recovery haven´t really solved the financial problems of the great majority of people. The former recovery didn´t either. When this happens, the great majority feels that capitalism and democracy do not function well enough for them. Populism increased like it did in the former crisis. Catastrophe is bound to happen, when these problems are not solved. During the 1930s, the dominant world power Great Britain confronted the rising power Germany. Today, there is about to be a big conflict between the dominant world power US and China. A hybrid was is on. It is hard to forecast whether it becomes a full blown conflict that is fought until destruction.

Archetypes during a Crisis era

In a Crisis era, Prophets can be seen more as spiritual elder leaders than active seniors. They highlight their physical weaknesses. They are more interested in religious beliefs and are willing to praise the lord for younger generations. Women are more interested in religion than men. Political leaders are often Prophets during the Crisis. These gray champions demand moral values from the younger people. They also need to understand that their economic wellbeing is diminished during Crisis. Their financial benefits are reduced for the sake of younger generations. Boomers have lived without great financial problems until now. They have to get used to have less money for consumption. Some of them will work after retirement, especially during a climax of the Crisis.

Nomads are in midlife during a Crisis. This archetype has the biggest financial suffering. They have the biggest role in solving problems in society. They have to think about conflicts between there own benefits and the socially acceptable solutions. Their number one goal is survival of the society. They have also the greatest responsibility in getting people to work on common good, instead of their own benefits. Nomads are flexible employees. They are willing to change jobs and their behavior if they are necessary for their survival. A typical success story is an entrepreneur who is known for his technological ingenuity, being flexible, and his cunning plans. Typical failure is a person who takes big risks and do not accept their losses on time.

Heroes represent cooperation during a Crisis. They guide technological development for more communal purposes. Facebook is one good example. Mark Zuckerberg belongs to Hero generation. Heroes work in bigger groups of people than other generations during Crisis. Older generations see them as a generation who works towards its own good, but it is not true. During a climax this is a big thing. Without this cooperation, there would have been a catastrophic solution for each Crisis era. Heroes solve problems through cooperation much better than older generations´ expectations. The behavior and clothing of young adults will become more harmonized. Individuality suffers. They are ready for sacrifices because of the common good. They will use violence if necessary and they are willing to fight for the bitter end. As an employees, Heroes strengthen the role of labor unions during a Crisis. They will also take care of decreasing the differences in income between the poor and the rich.

Artists have only small roles during a Crisis. They are either in the late elderhood or childhood. They are dependent on others. Artists are overprotected as children. They also suffer from losses of parents more than any other archetype. They help adults by doing small chores like cleaning or vacuuming. In the late elderhood, Artists can only follow how the Crisis advances from the side and hope for wellbeing for their last years of life.

I could also speculate about the future, but I will not do that, because I cannot forecast anything.

This is all for the long term Anglo-American cycle.

-TT

Angloamerican long-term cycle, part 3, generational archetypes

As it is with Turnings, there are four generational archetypes. Each archetype has their own common characteristics. These characteristics are found from the majority of each generation. Each generation lasts about a one phase of life. All these archetypes arrive always in the same order. Each archetype has its own way of reacting to events in different phases of life. These phases of life start from childhood, moves through young adulthood to midlife, and ends in elderhood. One can also add late elderhood for the fifth phase, but it is irrelevant in this context. There are not enough people in late elderhood to have a significant effect on events in the world. Each archetype in each phase of life has a different effect on other archetypes. These effects are guided by the long-term cycle with four Turnings.

Childhood is a time for growing, learning, and approving the need for protection from older generations. The social role of children hasn´t really changed in the last decades, even though technology and medicine have improved significantly. When the childhood ends, young adulthood begins. In this phase of life, it is time to transform ideas and dreams into projects and plans. It is also time for building a career and starting a family. Midlife is a time for conserving lifestyle, and transferring dreams and ideas into reality. Guiding younger generations is one of the most important tasks at this phase of life. Most people also start realizing their aging and start seeing signs of their transformation towards elderhood. Most people die in this fourth phase of life. This is the time when you can stop caring about your duty towards the society and finish your career.

There is a contradiction to consider, when you think about how the generations are formed. History makes the generations and generations make history. It is not easy to define the generations when new children are born so much every second. So the question is how do you define the generations? First, you need to define the length of each generation. A generation is a group of people who have been born in the same time in history. This time has the approximate length of one phase of life which is around twenty years. One generation has seen the same events at the same time. Second, majority of the generation have similar beliefs about families, gender roles, institutions, politics, religion and future. And majority of them react the same way for the same events. Any individual can still have his own ways of believing and reacting. Third, they have a sense of belonging to a certain generation. For example, Millennials feel they belong to their own group of people. Each generation has also its own biography.

Different archetypes

Prophets are born and raised during a High. They come of age as a narcissistic young adults during an Awakening. When they are in midlife, they cultivate their moral principles during an Unraveling and they become wise gray champions during a Crisis. During this fourth Turning, leaders are usually Prophets. They guide younger generation to a great victory or catastrophe. Other archetypes see them as narcissistic, arrogant, and ruthless. They are principally endowed towards vision, values, and religion. Prophets have the greatest Effect on Heroes, and vice versa. The reason for this is that when Prophets are in midlife, Heroes are in childhood, and vice versa. Some of the Prophets that had big effects on people in history were, Benjamin Franklin, Abraham Lincoln, and Franklin Roosevelt. The best known Prophet today is probably Donald Trump.

Nomads are born and have a liberal upbringing during an Awakening. During an Unraveling, they become marginalized from the society when they are in young adulthood. Their actions are pragmatic during a Crisis in midlife and they accept their destiny as ignored elders during a High. During this Turning, their efforts and actions during a Crisis are forgotten. Some of them are even humiliated with a lack of respect from younger generations, even though they were the most important generation for the victory during the last Turning. Other archetypes see them as practical, cultureless, and amoral. They are principally endowed towards freedom, survival, and honor. Nomads have the biggest effect on Artists, and vice versa. Some of the Nomads that had big effects on people in history were George Washington, Ulysses S. Grant, and Dwight Eisenhower. The best known Nomad today is probably Barach Obama.

Heroes are born and protected during an Unraveling. They have a role as cooperative young adults for solving a Crisis. They are then guided by some Prophets and middle-aged Nomads for getting the best possible result from the Crisis. During a High, they are arrogant middle-aged people and during an Awakening, they are strong and effective elders. Other archetypes see them as selfless, capable and mechanistic. They are principally endowed towards community, technology, and prosperity. Heroes have the biggest effect on Prophets, and vice versa. Some of the Heroes that had big effects on people in history were Thomas Jefferson, John F. Kennedy, and Ronald Reagan. Most known Hero today is probably Mark Zuckerberg.

Artists are born as overprotected children during a Crisis and they are senstive yound adults during a High. They function as undecided middle-aged leaders during an Awakening and are emphatic elders during an Unraveling. Others archetypes see them as open-minded, emotional and undecided. They are principally endowed towards competence, due process, and pluralism. Artists have the biggest effect on Nomads, and vice versa. Some of the Artists that had big effects on people in history were Theodore Roosevelt, Woodrow Wilson, and Colin Powell. The best known Artist today is probably Warren Buffett.

Next week, I will publish a text about an ongoing Crisis. Until then,

-TT