Observe a model of the Before and the After.

“It’s part of the whole outfit,” says Ms. Benson, a 25-year-old assistant to a music manager. Wearing the Booty Pop brand of underwear, which contain egg-shaped foam pads to plump up the posterior, “I look better, I feel better, and as a result, I act better,” she says.

The Liking Cue from CLARCCS, right?

You do see this is a persuasion example, don’t you?

Booty Pop is actually a pretty good persuasion metaphor, too, so let’s note that.

Green with the environment, green with money, and green with envy – put them together and you get the Eco Index.

The Eco Index, which is basically a software tool any apparel maker can use, poses a series of questions to companies on their environmental and labor practices—some of which require answers from the companies’ suppliers. It then assigns a score representing a percentage of a perfect score.

The folks who make and sell clothes have spent the last three years developing the Eco Index.  They think it addresses Green concerns in a way that will make more Green for them.  See, consumers torn between two different brands of jeans, say Levi and Wrangler, might just look at the Eco Index score to close their decision.

At first glance, I’m impressed with the Eco Index.  It is fabulously inSincere and if implemented, probably will work as advertised.

However, I’m worried.

It’s taken three years to develop a self report scale?

And, they chose a self report scale to measure things like labor practices and environmental impact?

Sounds like those bad observational studies from epidemiology, climate studies, evolutionary psychology, and economics I laugh about on this blog.

Three years to develop a new self report measure?  That’s the time period for a new NIH grant.  Can’t tell you how many planning meetings I’ve attended where someone was proposing to take three years and a quarter of a million taxpayer dollars to invent a self report scale to measure perceived breast cancer risk or estimated calorie expenditure while eating Hostess Cup Cakes or whatever.  The guys behind the Eco Index must have some NIH experience.

And why self report?  Why not just count things like, total amount of fines and penalties paid, worker mortality and morbidity, amount and type of materials used in products?  It’s really better to use an epi conceit like

1.  Estimate the amount of pollution you’ve contributed to local water systems over the past 10 years.  Circle the letter that best describes your estimate.
a. none (we never pollute, we recycle in novel ways)
b. very little (accidental)
c. some (in a hurry)
d. a bit (profits were down that quarter)

If the WSJ was covering some crazy science project on global warming that used self reports like this, they’d beat the writers into the ground like tent pegs.  But, for a Green solution to a Green problem, business is simply Green with envy for epi.

Will the Eco Index work as a persuasion tactic for sales?  Yes.  Of course.

A society advances by the number of operations its people can perform without thinking!!!

“Hey, an Eco Index of 99!  I’ll take three!!!”

Among the many attributes the story of Shirley Sherrod, it stands as a strong example of Biased Processing, that High WATT Central Route approach that uses existing beliefs, expectations, and schema to understand Arguments, rather than following Arguments to conclusions.

On July 20, 2010, a conservative political website posted an edited version of a speech Ms. Sherrod had given to a meeting of the NAACP.  This posting rather quickly came to the attention of the Secretary of the Agriculture, Tom Vilsack.  He only watched the edited version of the speech and did nothing to obtain a copy of the entire speech.  Based in part on that edited version, Vilsack asked for and received Ms. Sherrod’s resignation.  Later, when Vilsack watched the entire speech, he changed his mind about Ms. Sherrod’s remarks, apologized for his hasty decision, and offered her a new job with the government.

Regardless of your political position on this event, I want you to focus on how people like Secretary Vilsack were thinking.  I see it as a clear example of the ELM Bias Process.  There’s no doubt that Vilsack was a High WATT seeker and processor of information about this event.  He moved quickly over the course of a few hours to reach his decision once he saw the edited clip from the political website.  He clearly sought information from other people about this event and had indirect contact with Ms. Sherrod through her supervisory chain.  There’s no evidence at all that Vilsack was a Low WATT Peripheral Route processor ambling along looking for spangly Cues.

Yet, you can also clearly see that Vilsack did not look for all relevant Arguments (for example, he didn’t obtain a copy of the whole speech before he sought Sherrod’s resignation) and he used an existing set of beliefs (the credibility of his Cabinet agencies) to interpret the Arguments contained in the edited speech.

One of the great persuasion problems for any person is trying to understand when you are Objective and when you are Biased.  While Objective Central Route processing does not guarantee you will find the persuasion “truth,” it is usually the best chance you’ve got.  Rarely does Biased Central Route processing lead you to a clear eyed understanding.  But how can you tell the difference between Objective and Biased?

The strongest indication is how self-relevant the issue or event is to you.  If the event cuts to the core of your identity, your strongest beliefs and values, chances are you are Biased and you will make Arguments fit your existing beliefs rather than following the Arguments where they lead.

Another way to see this is with the Rule, All Bad Persuasion Is Sincere.  I suspect that Mr. Vilsack was entirely sincere in this event and did not think strategically about it.  He thought he was on a Truth Mission even though this is clearly a political event which means there’s a ton of ambiguity, disagreement, and conflict in the event – reasonable people will take different positions.  An inSincere Persuasion approach rather than a Sincere Truth approach might have served Mr. Vilsack better.

When an event hits your hot buttons and moves you to Sincerity, be careful.

Look up.  Sniff the air.  Smell it?  Get ready for the end of the fear market and a return to the greed market.  Read the tea leaves and see smart computers in your futures.

One upstart in the AI race on Wall Street is Rebellion Research, a tiny New York hedge fund with about $7 million in capital that has been using a machine-learning program it developed to invest in stocks. Run by a small team of twentysomething math and computer whizzes, Rebellion has a solid track record, topping the Standard & Poor’s 500-stock index by an average of 10% a year, after fees, since its 2007 launch through June, according to people familiar with the fund. Like many hedge funds, its goal is to beat the broader market year after year.

Wow.  Beating the S&P by 10% over 3 years.  How do they do it at Rebellion?

“It’s pretty clear that human beings aren’t improving,” said Spencer Greenberg, 27 years old and the brains behind Rebellion’s AI system. “But computers and algorithms are only getting faster and more robust.”

(What I wouldn’t give to be 27 again.  Almost the smartest guy on the planet, but always the smartest guy in every room.  And, I only got smarter . . .  until, well, you know . . .)

Ready for the Magic Words?

The firm’s current portfolio is largely defensive. One of its biggest positions is in gold stocks, according to people familiar with the fund.  The defensive move at first worried Mr. Fleiss, who had grown bullish.  But it has proven a smart move so far. “I’ve learned not to question the AI,” he said.

“. . . not to question . . .”  Please remember this when you read about Rebellion and lawsuits.

If you are old enough or well read enough you might remember ‘Adam Smith’ who started the postmodern wave of creative nonfiction writing in finance and business with his monster book, “The Money Game,” published in 1968.  George Goodman, the nym behind the pseudo of Adam Smith, introduced us to Wall Street and quants like Albert the chartmeister, Irwin the Professor, and the darkly foreboding Railroad Bill.  They all said and did the same things they are saying and doing today and as exemplified in the WSJ story about Rebellion.

All Bad Persuasion . . .

P.S.  If you missed ‘Adam Smith’ in the 1970s check him out.  George Goodman really did invent the new business writing that endures today.  Guys like Michael Lewis couldn’t exist without Mr. Goodman.  Plus Goodman’s books are still great reads.  He spotlighted Warren Buffett in 1973 in “SuperMoney.”  Talk about a guy with vision.

P.P.S.  Interesting sidebar on pseudonyms.  George Goodman writing as ‘Adam Smith’ enjoyed huge success in the 1970s and 1980s, but you’ll have trouble finding his work on Amazon.  If you type in “George Goodman” you don’t find his stuff and if you type in “Adam Smith” it’s even worse.  You need to know specific titles to find him in databases nowadays.  Check out the Wiki entry for George Goodman to learn more about his work and the man himself.  A most interesting life.  But, be careful with pseudonyms.  Databases won’t remember you!

You were there, kids, when It Happened.

China, powered by years of rapid economic growth, is now the world’s biggest energy consumer, knocking the U.S. off a perch it held for more than a century, according to new data from the International Energy Agency.

The US was by far the largest consumer of energy since the early 1900s.  Ten years ago, US energy use was twice as large as China’s.

So what?

“The fact that China overtook the U.S. as the world’s largest energy consumer symbolizes the start of a new age in the history of energy,” IEA chief economist Fatih Birol said in an interview.

History of energy?  It’s much larger than that, my influential friends.  Energy drives economics and economics drives Power, National Power.  And we understand Power and Persuasion, right?

Consider, too, what’s likely to happen in the near term.

The U.S. is still by far the biggest energy consumer per capita, with the average American burning five times as much energy annually as the average Chinese citizen, said Mr. Birol, who has been in his current role for six years.

China has just passed the US in total, but per capita the US uses five times as much.  China, obviously, isn’t going to stop its energy demand simply because it consumes as much as a nation.  It will keep going until its energy demand gets closer to the per capita US rate.

I believe that persuasion principles are universal and eternal; they apply for all faces and places, all times and rhymes.  Cultural differences change only the interface, but not the process.  Thus, the ELM works in Beijing, but it better speak with a Mandarin accent.  Or . . .

Zhè shì duì lìng yīgè rén, yúchǔn de!