“It is difficult to get a man to understand something when his job depends on not understanding it.” – Upton Sinclair
Michael Lewis’ The Big Short covers events leading up to the economic crisis of 2007-2008 from the perspectives of a handful of investors who, independently of one another, cashed in on an opportunity of a lifetime. By figuring out what nobody else on Wall Street noticed, grasped, or wanted to understand, the renegades made hundreds of millions of dollars.
The entire time a single doubt haunted most of them. How was it possible they were the only ones who understood something so obvious?
For starters, unlike everyone else on Wall Street, the mavericks did their homework which confirmed what the smart money (on the losing side of the bets) refused to consider — housing prices were bound to fall and the mortgage market was certain to collapse.
Still, right up until the renegades’ predictions materialized, hedge fund billionaires, institutional investors, peers, rivals, friends insisted the outliers didn’t know what they were talking about, the media ignored them, and regulators who did agree to listen were less than impressed with what they heard.
The savviest Wall Street players were so sure of themselves they offered irrational odds that made it possible to turn relatively small bets into mega-payoffs. One group, made up of three amateur investors working out of a garage, parlayed a combined $110,000 savings into more than one hundred million dollars.
On a dopaminergic level
The Big Short is actually about insanity. More specifically, it’s about the insanity resulting from dopamine-induced addictions to money, power, acceptance, approval, and status.
What could be more insane than out-of-control psychopaths pulling down tens of millions a year to come up with ways to screw anyone stupid enough to fall for their scams? I’m talking about lunatics with enough money to bribe credit rating agencies and buy enough members of congress to legitimize illegalities and then reward (instead of persecuting) the reprobates for reckless, inane, insane, and criminal behaviors that destroyed economies, careers, and lives.
Ignoring herds of stampeding elephants
To his credit, Mr. Lewis does an incredible job writing about the mass insanity. At the same time, he didn’t acknowledge the insanity’s existence or question what could possibly make so many intelligent individuals behave so deceptively, despicably, insanely, and (let’s be honest) unbelievably stupidly.
I believe he conveniently avoided noticing the obvious because, like the Wall Street gurus who bankrupted their companies, he didn’t want to know.
Though I’ve yet to read it anywhere, I’m convinced a key symptom of insanity (in addition to lying, cheating, stealing, and destroying) is the ability to ignore, deny, and even dismiss the existence of the widespread insanity plaguing our species. Sane people don’t lie, cheat, pollute, collude, wage wars, or destroy.
A method to ignoring the madness
Acknowledging the rampant insanity comes with an implied obligation to investigate the possible causes of both the insanity and widespread dishonesty required to ignore the insanity. In turn, even rudimentary probing comes with the threat of discovering the source of the pathology, which is addictions to insane behaviors that, in insane societies, are considered normal, acceptable, and even admirable.
Addictions reduce all choices, behaviors, likes, dislikes, and beliefs down to protecting and triggering dopamine flow. The difference between addicts is how the neurotransmitter is triggered. Some use drugs, others use gambling, social media, food, sex, safety, power, acceptance, approval, attention, status, heroin, and belief systems.
The cast of characters in Mr. Lewis’ book were addicts who use money to trigger the same dopamine squirts junkies trigger with heroin. The similarities between money and heroin addicts include an infinite capacity for self-deception, lying, cheating, and stealing coupled to a total indifference to any damage the addicts cause their victims.
The differences highlight why money addicts are so much more destructive, reprehensible, and despicable than junkies.
- Junkies can only inject so much heroin before overdosing. For money addicts, too much money is never enough.
- Junkies tend to limit their destruction to themselves and small numbers of friends, loved ones, and victims. Money addicts wreak untold havoc on huge numbers of victims.
- Junkies have to hide their needles and stashes or risk jail for using an illegal dopamine-trigger. Money addicts get away with flaunting their addiction to a totally legal dopamine-trigger.
- Most people understand the absurdity of junkies destroying their health to score dopamine squirts in primitive brains. Very, very, very few grasp how insane it is to allow money addicts to ruin economies, environments, and lives to score the exact same dopamine squirts.
There are money addicts worth tens of millions of dollars desperately trying to make more, more, more. And though clever enough to acquire what they don’t need or actually want, none of them are smart enough to understand that what they do want, what they crave, is the dopamine triggered by expectations of acquiring the money. And, because they’re addicts, they don’t care who gets hurt or what’s destroyed, as long as they score the dopamine highs that leave them miserable and craving more dopamine.
On a personal level
As someone who understands the futility of trying to explain the blatantly obvious to the conveniently ignorant, it was refreshing to see so many examples of dopamine turning seemingly intelligent and rational individuals into defensive, offensive, argumentative, dismissive, and irrational ignoramuses.
On a less positive note, The Big Short was filled with depressing reminders of why dopamine-induced addictions might forever remain the world’s best kept non-secret.
- The mavericks shared a strong financial (dopamine-inducing) incentive to learn what nobody else wanted to know. When it comes to understanding dopamine there’s little to no dopamine-inducing incentive to consider the obvious.
- Self-destructing and hitting rock bottom isn’t always enough to stop addicts from their self-deception, denial, and destruction.
- Addicts never assume responsibility.
- The symptoms of all addictions, especially lying, cheating, stealing, lack of consciousness, and dearth of conscience actually help addicts succeed.
- Addicts hate visionaries because visionaries threaten liars’ dopamine flow.
“The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function. One should, for example, be able to see that things are hopeless and yet be determined to make them otherwise.” – F. Scott Fitzgerald
I really do believe things are hopeless but I’m not ready to give up. On that note, I’m working on a plan to turn everything around.