Wednesday, November 7, 2012

Scam Detection and... Quantum Physics?

schrodingers lolcat
schrodingers lolcat (Photo credit: Arthur H.)
News of Nobel Prize given to two scientists who was able to actually create an experiment that proves Schrodinger's Cat paradox had me thinking about the "duality" of a certain situation... namely, a "potential scam".

For those of you who don't know what Schrodinger's cat is, here's a thought experiment. Imagine that inside a box is a cat. Some sort of a random number generator is ready to throw a dice. If the dice comes up 1 to 3, poison is released, and the cat dies. If the dice comes up 4-6, the cat lives. However, you don't know until you open the box. 

So, let's say the dice is thrown, but you don't know the result. It's random. Is the cat dead, or alive? 

The proper answer, in terms of quantum physics... is... BOTH! To the outside world, it's the SAME. The cat is both alive... and dead. And you don't know which result UNTIL you open the box. The act of opening the box "forces" the outcome into one or the other actual outcomes. 

When you think about a "potential scam", it's very much the SAME WAY: it can be both a legitimate business... and a scam... at the same time.  You don't know UNTIL you peer inside the box. Outside the box, you can easily find evidence to support EITHER conclusion.

So this is a question only you can answer BEFORE the box is opened (and you can't open it... only the company owner and/or the government can)... At what point should you be worried that it's probably a scam?

I suggest you think about the problem several ways:

1) Is the evidence supporting "it's a legitimate business" actually real? Or just red herring? Scammers and sincere amateurs are known to throw in various red herrings to dilute the issue and hoping you don't notice. And they will often IMPLY, INFER, and INTERPRET evidence to suit them (see next item)

2) Can the evidence have alternate explanations / interpretations? Are they clear and precise, or very vague and open to interpretation? Are the interpretations "reasonable", or overly optimistic?

3) Are they a disguise, a distraction, and results that you expected to see? What are you NOT seeing?  If you expect to see something, then you will see it. it's called "pre-coneived notion", i.e. cherry picking the data to support what you *want* to see. It's confirmation bias, and it leads to BAD decisions.

4) If there is doubt, are you *sure* you can live with the doubt?  (also see next question)

5) Are you being influenced with cult mind control tactics telling you to IGNORE the doubts and "negativity"? What are they trying to hide?

6) Is the evidence about how the business operates in regards to LAW, or merely pertains to perception? (A business can APPEAR to be legal, but in reality is a total scam  EX: Zeek Rewards Ponzi)

As you cannot "open the box" per se, you have to decide which way the results may lean.  You have to interpret the probabilities of each side, honestly, as it is YOUR money and time that you are investing.

If you wait until you can see inside the box, you may end up waiting until your money is lost, much like the victims of the Zeek Rewards ponzi scheme. They ignored all the warnings. To them, there's only one outcome that matters... the successful. Either they don't see the other outcome (it's a scam!) or they think the probabilities are so low it can be ignored.

Don't make their mistake.  Evaluate your risk every day, and heed your own warnings instead of pushing them deeper underground. It'll hurt you in the long run.

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