Saturday, October 20, 2012

How do you spot a liar? It's not that hard.

Pamela Meyer, author of "Liespotting", shares some tips on how to spot lies.

Here's the biggest takeaway though:
"A lie has no power whatsoever by its mere utterance; its power emerges when someone else agrees to believe the lie.
In other words, a lie is like tango... it takes two, a liar, and a believer.

While you are not going to think everybody around you is going to lie to you, it may be prudent for you to learn how to spot lies when dealing with strangers, both in person, and online.

The normal way to deal with "not-sure-stuff" is to research it, and indeed, 65% of Americans don't believe what's on the Internet. 

The problem you don't have time to research it all, thus, you have to make judgement calls on what to trust and what not to, often under time pressure, and very often, you trust the WRONG STUFF.

Friday, October 19, 2012

Bad Argument: The Red Herring Definition defense

One of the defenses often used by misguided enthusiasts is what I named "Red Herring Definition Defense", or if I'm in a bad mood, the "Wikipedia defense".

Basically, your opponent, instead of trying to take apart your supporting evidence, to prove your statement was wrong, your "opponent" just says "you are wrong" then throw a definition (often copied from Wikipedia or other marketing material) at you, and claim that proves they are right and you are wrong.

For example, if you are discussing Amway's comp plan and relevant case laws (such as Koscot, Omnitrition, and so on), quoting the first paragraph of definition of "network marketing" from Wikipedia is a red herring.

If your opponent use this bad argument, it reveals lack of proper analysis of whatever the defender is objecting to, but a "gut feeling" of "you are wrong and this is why", which often, is a sign of "attribute substitution", where the defender *thought* s/he answered the question, but in reality his/her answer is unrelated to the question (but at the moment, sounds related... somewhat).  (see end for link to "attribute substitution" explanation)

Another example: If I am arguing for "Smoking is bad for you", quoting definition of "tobacco" does not hurt my argument (or help your argument) in any way. Thus, it's a red herring.

The arguers sincerely believe what they are arguing for, but sincerity, in this case, is still irrelevant.

Here's yet another example of a a "red herring definition defense".

In response to an analysis I wrote about AiYellow, and how it may be violating multiple US MLM laws with its current compensation plan, at least two supporters of AiYellow post what they considered to be rebuttals.

Thursday, October 18, 2012

Motor Club of America / TVC Matrix: legitimate, or pyramid scheme?

Another opportunity that has incurred some controversy is Motor Club of America, i.e. MCA, which is being marketed by TVC Matrix.

Similar to AiYellow mentioned before, MCA seem to have a valid product, but the compensation plan has many of the signs of a pyramid scheme, and when this is pointed out, there were quite a bit of outrage among its affiliates, who answered with all the sincerity they have, but failed the address the question which we will address...

What is MCA?

MCA is a motor club similar to AAA, with a 3 tier membership (10, 15, or 20 a month), seem to have a long history. However was sold several years ago and turned to MLM marketing. (For reference, AAA membership is about $70 a year)

Most promotional websites touting MCA refer to MCA as an income opportunity / motor club hybrid, or mostly as an income opportunity. I have yet to find a single promotional website that PRIMARILY markets MCA as motor club. Obviously this is subjective to my interpretation, but this is somewhat troubling.

Furthermore, TVC and MCA are used almost interchangeably.

The comp plan basically says for every member you refer (who pays 2 months fee to join, and monthly fee there after), you get 4 months fee as commission. However, if they cancel before completing a full 12 months, you have to pay the commission back. (EDIT: There's a comment that there is no "clawback". Until there's confirmation, clawbacks are "unconfirmed") There are inconsistent talks of "residuals" (i.e. small payment per month).

So what is the problem with MCA/TVC?

The problem with current MCA comp plan is that it has virtually no separation between member (no income) and affiliate (earn income).

Wednesday, October 17, 2012

Magicians and Applied Psychology

Psychology Today interviewed Alex Stone, magician and author, and they discussed why magic and cons are linked by long history.

What do con artists and magicians have in common? Why are con artists the only ones we consider artists?Many of the techniques used by magicians were developed by, or in tandem with, grifters and hustlers and con artists. Magic and cons are kindred arts.
You note that “magic is inseparable from deception.” Can you elaborate?Because magic is basically a form of cheating for amusement, to borrow a cadence from the great 19th century French conjuror Jean Eugène Robert-Houdin. 

Would you have believed in Paul R. Burks, who once performed as "the singing magician", that Zeek is perfectly profitable and will make you oodles of money, if you had known he was a magician?

Tuesday, October 16, 2012

Can Startup MLMs sell "founder" positions? No!

"The MLM Attorney" Kevin Thompson wrote this back in 2011, but it is valid then as it is now.

Basically, there are three ways startup MLM tries to raise the initial capital from its members:

1) Affiliates pay a LARGE fee, say, $50K, to join as the first dozen or so affiliate, i.e. "master positions"

2) Affiliates pay a LARGE fee, say, $50K, to buy a portion of company's future revenue, say, 1% pool

3) Affiliates pay a smaller fee for "beta access" to the system and its products/services

To put it plainly, the first two are ILLEGAL because they will be considered "securities" by the SEC, and since a startup would not have registered with the SEC, they will be operating ILLEGALLY.

Monday, October 15, 2012

How legal is AiYellow? Good question.

Recently, there are some questions raised regarding AiYellow which offers legitimate products, but the comp plan appears to be recruitment based pyramid scheme.

The supporters / members for both, needless to say, are very offended when Oz (on and I pointed out their problems with the comp plan. Somehow, in the supporter's mind, having a legitimate product is all that's needed for the business to be legitimate.

So, what's the problem with AiYellow Internet's income opportunity? 

AiYellow started as AiAmarilla in South America, but that's not what's important here. Basically, they are an Internet Yellow Pages service, claiming to create a lot of SEO-friendly links for most businesses and locations, and affiliates buy the "codes" (from $35 to $325) from AiYellow, then sell them to businesses who wants to appear on such listings. Nothing wrong with that (I doubt the viability of an "Internet Yellow Pages" in the times of Google... but that's NOT related to whether they are operating legally or not).

The problem is they are paying you for YOUR purchase of these "ad packages", not on your sale of them. This violates the "Weber vs. Omnitrition" clarification of the Koscot test.

Sunday, October 14, 2012

Fake Online Profiles, may be used to scam people

In September, TechCrunch highlighted a fake profile of someone who claimed to work at TechCrunch... except that person is WAY too pretty.

"Her" gig was up when she tried to "friend" a Wired magazine writer, who brought it to TechCrunch's attention.