Scam Psychology: Charlie Munger on How You Screw Up, Part 1 of 6

You may have heard of Charlie Munger. But if you haven't, you should have heard of his partner: Warren Buffet, one of the 5 richest man in the world.  In 1995, Charlie Munger gave a speech at Harvard... about how people misjudge things. Here's my personal interpretation of his lessons, as applied to network marketing. You can read the full speech.

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In the speech given at Harvard in 1995, Charlie Munger identified what he called "24 standard causes of human misjudgment." I call it "24 reasons why you screw up".  Here is 1 through 4.

1) Not understanding power of incentives

Incentives is the standard way if you want to influence someone's behavior. If you are not getting the results you want, you are probably using the wrong incentives. And if you don't understand how incentives work, you won't get the full use out of them (or understand how they're used on you)

One of the most direct ways network marketing company influences its affiliates is the compensation package, also known as the comp plan. And comp plan is the best indication how serious the network marketing company about retail is how it structures its comp plan. If the comp plan rewards self-consumption by tying commission to your downline's self-consumption, you have a pyramid scheme, as little if any product is actually being retailed. By studying how the incentives are actually applied, you can see which way the company wants the affiliates to jump. And if that doesn't match what they say they are, perhaps the business is not what it appears to be.

Another way incentives play into network marketing is not realizing the way incentive actually works, generally by overestimating one type of incentive vs. another kind. One of the most frequently used rebuttals in network marketing "So-and-so is famous and works with MLM X. So-and-so can't POSSIBLY work for a scam as it would ruin his reputation, so MLM X can't be a scam." This argument basically postulates that Incentive A: MLM X paid So-and-So 75K for a special appearance at a convention for a speech is NOT sufficient to overcome Incentive B: Negative reputation due to MLM X may be a scam. However, when you think about it, this makes absolutely no sense at all. Plenty of celebrities have pitched for scam at one time or another. Snooki had shilled for Zantrex the super-caffeinated diet pill that was called out as bunk by doctors. Bob Eubanks was once tricked into making a test show which was then used as "pilot" to scam investors into funding a show that doesn't exist.  Celebrities are people too. They can be tricked, or they simply don't care as you're more focused on his/her celebrity status rather than what s/he endorses. The negative incentive is nowhere as big as the rebuttal claimed to be.

By not understanding the power of incentives (even negative incentives), some people came to the wrong conclusion.

Scam Psychology: Why Bad Arguers Often Retreat to Conspiracies As Final Defense

Conspiracy Theory with Jesse Ventura
Making a living through selling nothing... like a lot
of scams that call themselves network marketing
(Photo credit: Wikipedia)

In studying the financial scams and its victims, as well as the common arguments the brainwashed sheeple use to 'defend' the scam they're in, one of the most common "final arguments" is accuse any 'opponents' as a part of the conspiracy against something. While most often found among the "lotion and potion" defenders, they can be found among all sorts of scams, esp. one that had gone viral across the world (and thus must be eradicated).

There seem to be 3 general types of conspiracies when it comes to network marketing, which is grouped by size: personal conspiracy (it's just some hidden reason why the "opponent" is against the scheme), industry conspiracy (some sort of nebulous attack by competitors, though sometimes it's the government), or global conspiracy (often involving some nebulous mention of Bilderbergs, etc.)

All the conspiracy boils down to is "motivation denial of evidence (of scam)". Such conspiracy accusations can take the following forms (but obviously is not limited to such)

• You must have failed at ____ to be so bitter
• You must work for our competitor
• You're just out to get hits for your blog
• You are a part of medical establishment against the "wellness industry"
• You're a part of conspiracy of the rich to keep the rest of us poor

Problem with such conspiracy accusations is conspiracies often rely on circular logic.

Q:Is there any signs of a conspiracy? 
A:No. 
Q:So why is there a conspiracy? 
A:Because conspiracy suppressed the signs! 

Or on a more personal level

Q: Why do you think I work for a competitor? 
A: Because you said we are a scam!
Q: Do you have evidence that I work for a competitor? 
A: No... but it made sense to me!
Q: Here's evidence why ____ is a scam. 
A: You are a liar and those evidence are fake.
Q: Why would I fake such? 
A: Because you work for a competitor.  
Q: But you said you have no evidence that I work for a competitor. 
A: Because you hid it really well! 

Basically, any sort of evidence can be dismissed by "it's part of a conspiracy (against us)".  You have to PRESUME the conspiracy to be true to make sense of the twisted circular logic. It's "self-sealing".

Conspiracy theories are often quite fascinating to study, as it's basically how the mind twists itself into a gordian knot. Psychologists have studied correlations of conspiracy theorists (PDF file), such as is there any correlation between beliefs of conspiracies (i.e. does believing free market make one more like to believe climate denial?)

The results are surprising, and a little troubling. And so was the reaction by the conspiratorial community.

Bad Argument: When You Comment, You Should Check Your Facts!

Was browsing YPRPariah's website, and found something amusing... Some Vemma noob came and posted some comment about how great is Vemma and how everybody else are losers for doubting Vemma, blah blah blah.

Vemma Product Photography and Ad
(Photo credit: themichaelminer)

Here's a point for point critique.  His stuff is in blue, and mine will be in red. 

Honestly I use to be skeptical about vemma just like everyone here. As a business student I’ve been approached multiple times. but I realized that if I’ve been approached so much times it must be a trend and I put my ego aside and just let my friends explain to me why their so excited

So he just admitted he's a victim of FOMO: fear of missing out.  

 At the end of the day you guys really have to choose who your listening too.

So why should we listen to him?  

For anyone who’s skeptical your choosing to listen to a wordpress blog which has no credibility over people like robert kiyosaki, bob proctor, and eric thomas who are all millionaires who all directly work with vemma.

It's interesting how much credence he puts in "credibility". I wonder if he knew the following:

Kiyosaki was an Amway rep and his book was made popular by Amway's Sager Group. And he advocates screwing over his partners because he got away with it TWICE. He charges big speaking fees to appear at events. 

Bob Proctor basically stole all his schtick from Napoleon Hill (and admitted so), and his wife and daughter are high-rankers in Vemma 

As for Eric Thomas, former NFL player and now "Hip Hop Preacher", he's an inspirational speaker who will come to your event if you pay him enough. Between 10K and 20K per appearance, according to one article, as spoken by himself. 

They work with Vemma because Vemma paid them. They are mercenaries, much like lawyers. 

 Why would such credible people put their million dollar reputations on the line to work with vemma if it was a scam? They don’t need any extra money so the risk of working with a scam DEFINITELY wouldnt be worth it.

The answer is simple: they can always speak for someone else. Kiyosaki is constantly pumping out more rehash of his books and has that stupid "seminar" for pumping people more money. Bob also speaks for various other companies as well as his own "The Secret" related seminars, and so does Mr. Eric Thomas. If anything happens to Vemma, it wouldn't hurt them much, if at all. The damage he *thinks* will happen to them is negligible, and the deterrence he relied on is nonexistent.

This is just "appeal to celebrity" fallacy, or "association with celebrity" fallacy.

Scam Psychology: Intelligence is NOT Rationality

Many people have asked... How can intelligent people, lawyers, doctors, people who got rich through their own efforts, and so on, end up joining a scam? Aren't they intelligent enough to avoid such things? Some even use this as a bad argument that I termed "association with authority" argument, such as "X is not dumb or stupid, therefore he could not have joined a scam. Thus, whatever he joined cannot be a scam."

Turns out psychologists knew about this problem for a while, and the explanation is very simple: intelligence is not the same as rationality.

Intelligence is usually defined as "ability to acquire and apply skill and knowledge"

Rationality, on the other hand, is  "the state of having good common sense and sound judgment".

The two definitions can overlap, butare not required to overlap. It is possible to have no sound judgment, yet have ability to acquire and apply skill and knowledge. A savant, for example, esp. an "idiot savant", has the phenomenal abilities such as mental math, perfect recall, photographic memory, and so on, yet has virtually no judgment or social skills outside of his/her expertise.

Of us the common people, we are just as guilty of what appears to be irrational decisions, caused by our various cognitive biases, and often, what we WANTED to be true. We are intelligent, but we are NOT always rational.

And scammers are very quick to convince us that being intelligent is being rational... and it's rational to join their scheme. And scammers are often amateur psychologists exploiting your cognitive biases to coerce you (without you realizing it).

Scam Psychology: The Need for Self-Delusion

English: Saul Bellow (Photo credit: Wikipedia)

MLM Skeptic has tracked various scams over several years, and it is always amazing to the MLM Skeptic how much self-delusion can the victims of a scam engage in, refusing the believe they were involved in a scam. Instead of probing for the truth and understand how they had been deceived, they instead invest their intelligence into justifying their own delusion that they could not possibly be involved in a scam.

The following quote seem to illustrate the point perfectly.

“A great deal of intelligence can be invested in ignorance when the need for illusion is deep.”
― Saul Bellow, To Jerusalem and Back

And indeed, the victims of a scam, so shocked by the news, have a deep need for illusion, or delusion, to prove to themselves that somehow, they could not have made a mistake, that everybody else must be mistaken.

Let us explore our cognitive biases, and understand how we came to behave irrationally.

Kevin Trudeau Will Face Jail for Lying on TV... AND Stiffing the Court of Penalties

Kevin Trudeau
 (Photo credit: Wikipedia)

Kevin Trudeau is a master salesman. Unfortunately, his early exposure to MLM seem to have lead him down a dark path, and he became a scammer instead. And now he's really going to pay the price... in jail. Following is a short history of Kevin Trudeau.

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Kevin Trudeau apparently was a real go-getter even when he was young. He was voted "most likely to succeed" by his high school graduating class. However, he refused to go to college. He claimed he went to an Amway meeting at 15 and have wanted to be financially free ever since. He claim to have started a mail order company before he was 18. However, after high school he tried selling cars for a while, found it boring, then went on the seminar circuit, peddling one thing after another, like "super memory!" around the nation. Apparently that was not challenging or lucrative enough, as he went into fraud.

Apparently around 1990 he impersonated a doctor when meeting with bank officials to open accounts, then wrote 80000 worth of bad checks. He apparently also fraudulently obtained 11 credit cards (identify theft) and spent them. For the first crime he spent maybe a month in jail as the judge gave him a soft sentence for first time offender. A year later, when he got caught for the credit card fraud, he spent almost two years in a Federal prison.

When interviewed by Washington Post in 2005, Trudeau blamed "math error" and "overzealous bank officials" for his rap sheet. For the fraudulent credit cards, he said he was unfairly penalized for paying late one time his AMEX card which resulting in him not being able to get any card, and he had no choice but to apply with fake social security numbers.

He just cannot admit that he did anything wrong. Such narcissistic behavior is indicative of sociopathic personalities.

The prison stay did not stop his criminal behavior at all. It only make him even MORE determined to make his money... through any means possible. He also met up with a guy named Jules Leib (to whom he gave a Tony Robbins self-help book while in prison), and when they got out, they teamed up to make money... through MLM.

How To Help People You Suspect Are Being Scammed

There has been many questions by folks with friends and relatives who were into suspicious schemes. The victims are so cult-indoctrinated that nothing seem to work. What can be done, if one cannot afford cult deprogramming / exit interview? And what if the victim does NOT wish help?

First, a disclaimer. I'm not a psychologist, psychiatrist, or know anything about the mind, other than some critical thinking. The following stuff is UNTRIED, UNTESTED "common sense" sort of approach I would take if I were to approach someone in a similar predicament.

My approach is... asking questions, Socratic questions. But this is NOT a quick fix. Undoing the knot will take a lot of time, and a lot of questions. This is my personal idea, based on Socratic Questions (as explained in Skeptoid #384). I hope this is of use to people, and I welcome any feedback. Any way...

You will probably need an empty work area, preferably with a big table where you can spread stuff out, a computer to do research on various topics, and a big stack of index cards. Figure at least 100, if not 200 cards, and a few pens, different color (you use one color for questions, he uses another for answers). You will definitely need one big red marker in addition to other colored pens.

And finally, you will need several hours, with refreshments and snack breaks in between, but NO CELLPHONES. The idea is to get the victim AWAY from his/her upline's influence for a while.

And you will need a quick lesson in critical thinking, and understand what is a "null hypothesis". I suggest you research a bit of critical thinking on your own before you attempt this "intervention".  Null hypothesis is best described as unknown / indeterminate state. If the premise is "WooPlus cures cancer", the null hypothesis would be "we don't know whether WooPlus cures cancer or not". the ANTI-premise is "WooPlus does NOT cure cancer". Facts and Logic (evidence) are suppose to move you from null hypothesis toward the premise. When there's not enough evidence you're left with the null hypothesis, not the anti-premise. Yet many people mistake the critical thinking process into thinking that it's either the premise, or the anti-premise, with no null hypothesis.

In the future, I may publish some of the better questions to ask, though this is highly dependent on the individual subject.

NOTE: If you cannot finish this in one sitting, you may want to pick a smaller premise, like "WooPlus product is effective for _____" first. Or perhaps ask for help analyzing his answers, even online. Just don't let him consult upline (yet). If questioned, reply that you want to get to the facts, which are easily Googled, instead of relying on someone else's memory.

There are three general phases:

• Engage and clarify premise with supporting evidence and logic
• Identify ambiguities, assumptions, and logical fallacies
• Re-examine premise with multiple perspectives

MLM Mythbusting: "If I can succeed you can too" is a double myth

One of the most persistent myths in MLM is "If I can succeed you can too", usually spoken by a relatively higher-ranked guy in the MLM. However, this is a VERY MISLEADING statement. The word "can" here is an equivocation.  The IMPLICATION here is a very high percentage (100%?) of people who do the MLM as hard as he does will succeed. The reality is the actual people who succeed like the speaker is only a few percentage of total.

Let's analyze this in two parts... The question of "succeed", then the fallacy of "you can too".

What is definition of "success" in MLM? 

What exactly is "success" in MLM? It's usually to make a comfortable living. Since MLM often claim to be replacing the conventional job and so on... Let's define it as... earn more than US median personal income, how's that?

So what's the US median personal income? According to Wikipedia, that's about 32K as of 2005.  (see graph to right)

So how many people in, say Vemma, makes more than 32K a year?

Good question. They don't know. In fact, NONE of the "mainstream" MLMs know exactly how much money their brand partner / affiliate / consultant / distributor / whatever makes. All the company know is how much commission the company had paid out. (And this is actually bad for the company, as there's no proof of "retail" activity, but they don't really care)

Let's just look at what data's available, okay? So, what's Vemma's stats?

ELEVEN Rebuttal Mistakes MLM Marketers Must Avoid

8-ball pyramid scheme model. (Photo credit: Wikipedia)

When one has been exposed to various MLM "opportunities", many of which are really pseudo-MLM pyramid schemes, one can anticipate the "defense points" the participants parrot from their upline whenever you see some real examinations of the scheme. Some of those do come prepared with facts. Unfortunately, they are the WRONG facts as they are often irrelevant. They generally fall into 3 categories:

• Money-related (but irrelevant) facts as defense (3)

All sorts of facts about the company's revenue, advertising budget, payout, bonus, etc, followed by "Still think _____ is a scam?"  When it's completely irrelevant.

• Name-related (but irrelevant) facts as defense (5)

All sorts of names associated with the company... Lawyers, consultants, celebrities, companies that may have done business with the company... Do they prove that the company's legal? No. 

• Logical Fallacy-related facts (irrelevant appeal) (3)

All sorts of facts that form irrelevant appeal, such as appeal to age, appeal to tradition, and so on. 

Let us examine each in detail:

Internet, MLM and FOMO... is that what Rippln's about?

As I was updating my Rippln review I also listened to some podcasts, and one of them mentioned FOMO, or "fear of missing out", and how this social phobia is driving some obsessive behavior such as checking on Facebook / LinkedIn / Twitter constantly, in fear of missing some news updates, social happenings, or such that would somehow instantly make you a pariah among peers. Then the figurative lightbulb lit up over my head: 

Rippln is just a FOMO exploiter. 

Rippln's entire idea is to team up with somebody and market THEIR stuff to its constituents, and if some of the constituents buy the stuff, their upline(s) get a cut of the profit. But this is basically exploiting FOMO, where you subscribe to Rippln and hope you don't miss some special deal. 

Unfortunately for Rippln, in order to make sure that there's enough PROFIT to be split bazillion ways among what they claim to be 1.4 million ripplers, thus far Rippln has picked a couple duds. 

Did you get a "Placebo Solution" that doesn't solve anything

After studying the aftermath of various scams and alleged scams, it is very often they seem to follow the same script.

As customer complaints start to pile up, they announce some sort of customer support revamp.

After a few months it's server outage.

After a few months it's "we got hacked"

After a few months it's "we got defrauded by international credit card scam that slammed us with hundreds of fake numbers"

The order may vary a bit, but the truth is the *same issues* seem to pop up at all these schemes and suspect schemes.

One wonders if they are offering "placebo solutions" just to keep the sheeple from complaining too much?

Bad Argument: "Focusing Bias" used as "proof" of viewpoint

Focus Bias (also known as Focusing illusion, Focusing effect, or Spotlight Effect), is a type of cognitive bias where the mind emphasize the portion of the issue they have exposure to (personal experience, personal calculation or consideration, etc.) and ignore / de-emphasize the portion of the issues that they don't see / understand, and thus cannot evaluate. This very often happens in MLM. Supporters of a scheme tend to overemphasize the importance of portions of the MLM system they have been exposed to, while ignoring the portions of the system they know little about.

One way this manifests itself is the supporter thinks because they experience ONE PART of the scheme, and that part seem to work fine, the entire scheme must be fine (and legitimate!)  I termed this "it paid me!" argument.

For TVI Express pyramid scheme, it would be the website, or sometimes, the actual trip that came with the membership, and for a few, the actual payout at one or two levels of the matrix. They don't care about the obvious pyramid scheme aspects of the scheme.

For Zeek Rewards, it would be the penny auctions, the "giving away bids", watching their "cash account" build up, and for some, real money in their bank. They pay no attention to where the money is really coming from, are there enough auctions to generate that much profit, and so on.

For Lyoness, it would be the how shopping build up their "accounting units" therefore they conclude that Lyoness works great, and they pay no attention to the part where you can BUY your units and recruit others to do so and thus benefit from it.

For each of these scams or suspect schemes, the supporters basically had the focusing bias where they focuses almost EXCLUSIVELY on the parts they have been exposed to, and they somehow feel that is the ONLY part that mattered (to them), while ignoring any other parts they had not been exposed to or know about.

That is a very dangerous position to be in, as there's more than a few ways a MLM business can cause you trouble.

Watch How Magician Thief Apollo Robbins explains Misdirection

TED (conference) (Photo credit: Wikipedia)

Your brain has limited amount of processing power available, and generally it concentrates on one sense or another, or it can spend time going over your previous memories, but rarely if ever, do both with any sort of proper efficiency. Thus is the power of misdirection... Focusing on the things that you thought were important, but wasn't.

Apollo Robbins, the "gentleman thief", otherwise known as a theatrical pickpocket, makes a living by taking stuff out of other people's pockets in front of live audiences, and returning them, in amusing and mind-boggling ways. He recently got on TED talk and explained how his techniques work: your attention span (aka "Frank") is solo-tasking... can only do one thing at a time. Sound, vision, touch, smell, taste, or memory search. It can't do multiple things at once. And even when you see or hear, you engage only a tiny portion of your various senses.

When you see something, you only focus on the portion you need to focus on, even though you technically saw the whole thing. If I ask you to take our your smartphone and ask what icon is in lower right corner, put it away, then ask you did you see what time it was on the phone... would you know? That's part of the misdirection... You did see the phone... you just didn't see the clock portion (upper right in almost all instances).

Thieves and scam artists use the same tricks to get you to pay attention on parts you *can* see, known as the "focusing bias", and ignore the parts you can't see (fraudulent claims of profitability).  Magic always have a link with cons, as magic is basically playing with your confidence of your senses. However, magic is benign, while scams are not, as observed by magician Joss Stone.

How Does Peter Principle Affect MLM?

Peter Principle states that "employees tend to rise to their level of incompetence". Of course, Peter Principle is talking about work and promotion within a company, where there are rules and ethics and such governing such promotions. Does Peter Principle apply to the MLM world? Very much so, albeit with much more disastrous consequences.

At its heart, Peter Principle is about how human beings apply their bias: why change what works, even though its a new situation. When this is applied to people, i.e. a person will keep doing what he's doing, even though he's promoted to a new set of responsibilities, that person will no longer advance unless s/he learns new set of skills.

However, such change of responsibility are sorely lacking in network marketing. When you "grow" in MLM, you don't really take on bigger responsibilities other than training or inspiring new members.

Network marketing has two primary skills: sell products/services, and recruit people. Both can be called "sales" to a certain extent, but require very different persuasive arguments.

To sell a person the product/service, you will argue that the service/product will make his/her life better in some way, and the price to benefit ratio is good, esp. among any competitors.

To sell a person the position (i.e. recruit), you will simply appeal to the person's greed, envy, and pride. Don't you want to be financially independent? Don't you want to be successful (like other people)? Don't you want to join a winning team? So on and so forth.

One appeal to base desires (7 deadly sins, any one?) while the other appeals to logic. Guess which one is easier? Appeal to the sins, of course.

Bad Argument: I Know What I Am Doing! (No you don't)

NOTE: this is a completed version of a previous post

Sometimes, when you tried to reason with a supporter of suspect scheme, and they have no logical retort to your points, they will instead bring out the "I know what I am doing" bad argument, which generally goes like this:

A: Acme XYZ is a scam because ____, ____, and ____.

B: I know Acme XYZ is not a scam. I know what I am doing. It's my business, not yours.

This is a total red herring, because it neither argues against the premise, nor argues for the counter-premise. It is completely unrelated.

What's more, there are several problems with one. One of which is "illusory superiority", in that we always think we are better than we really are. It's called "self-esteem". But there's more.

Are You Aware of Your Own Bias? How About MLM Lawyers?

Human beings are remarkably adaptable creatures. However, sometimes, this adaptiveness works against us. One way this happens is we become unaware of our own biases. It is simply the way it is. And this is especially apparently in the MLM world. And it often takes a bit of outside information or criticism to make one aware of one's own bias.  (If you think I have a bias leaning one way or another, let me know in the comments!)

Anyway, with the Brouhaha between Ackman and Herbalife, one of the few MLM lawyers in the country, Jeffrey Babener, wrote an article on his MLMLegal.com about what he believed Ackman missed.

Previously I've analyzed John Hempton's position on Herbalife. Hempton is a fund manager and is opposed to Ackman's position and found Hempton has his own bias that he doesn't seem to realize (or not apparent from his writing), but he's a money manager, not a lawyer. A lawyer should cover all angles, right?

In this case, not quite. Mr. Babener showed quite a bit of bias too.

Why Zeek Rewards Was Such a Successful Scam

Magic ball toss (Photo credit: backofthenapkin)

Zeek Rewards Ponzi, closed by SEC last year, is the largest Ponzi scheme in the US, involving up to 2 million victims (due to some people having multiple accounts, the actual number is closer to 1 million) for 700 million dollars. How did it get so big? Don't people care about the warning signs? Are they all so blind? These aren't the smartest people in the world (we are talking the average Joes, not the elites like those Madoff soaked) but surely there are SOME smart people in that million victims?

It is a combination of factors, and it had everything to do with psychology, by taking advantage of your cognitive biases.

Your brain, due to millions of years of evolution, tends to form thoughts in certain ways, and a successful scammer can take advantage of that.

Think about magic. A lot of magic relies on misdirection. The magician tosses the ball up and down, up and down, followed it with his eyes. Then he tossed the ball up... and it vanished.

No it didn't. He didn't actually throw the ball up, but his eyes went up as if he did. And you, expecting him to do the same thing again, didn't actually look at his hand with the ball.

In other words, you were "trained" by the magician to follow his eyes, not the ball itself, so you were amazed at the ball vanishing into the air... when it never left his hand.

Zeek did the exact same thing... It showed the victims enough of a legitimate business that the victims never bothered to follow the IMPORANT item... the money.

Is it any wonder that Paul Burks, head of Zeek, is a trained magician? 

But wait, there is more!

When Scientists are Skeptics, We All Win (Yes, this is Related to MLM, sort of)

Alan Sokal is a physicist that read the journals where his papers (and tons of other papers) are published, and wondered... Does someone actually read all that stuff? So he proceed to write the WORST paper he could possibly write. It's complete bull****, filled with buzzwords ("quantum gravity..." Ooooohhhhh! Aaaaahhhhhh!" )  but completely bull****. The paper was called "Transgressing the Boundaries: Towards a Transformative Hermeneutics of Quantum Gravity", and it was submitted to a journal called "Social Text", an academic journal of postmoderncultural studies.

It got published in 1996. When Sokal revealed the whole paper is pure bull****, and he basically "trolled" that journal, the feedback was definitely mixed. Some are horrified at the "lack" of vigor the editors of the journal demonstrated. Others are angry at Sokal for ridiculing other "scientists". There's also question on what exactly is "postmodernacultural studies", and why would a physicist try to troll them, and so on. The whole thing was dubbed "Sokal Affair" and even has its own Wikipedia entry.

The point is a scientists was skeptical of something, and he built a test to test that something.

How many of you would be willing to do that, or have done that, and I mean really test it, not merely "I tried it, it works, I got paid"?

Alan Sokal just struck again, when he and some friends took apart two psychologists, Fredrickson and Losada, who attempted to apply Lorenz Equation (huh) to "positivity ratio", and how feeling too happy will lead to a happiness inversion (what?) when the positive emotion to negative emotion ratio reached the tipping point of 2.9013 (huh?)  Sokal, along with Nicholas Brown, and Harris Friedman basically destroyed that other paper for all of the various reasons, including bogus math, bad logic, and much more.

Now you say, what does *that* have to do with MLM? Ah, but you see, this "positivity ratio" was a popular topic among the various "motivational speakers" who often show up at MLM events to "inspire" the crowd, and it was simply never challenged (cited over 1000 times, according to Google Scholar).

So what exactly is this "Positivity Ratio", how motivational speakers are citing it, and why is it bull****?

Romance Scam Gang Out of Nigeria Busted

According to report out of Benin City, Nigeria, authorities have arrested 20 suspects who had banded together as a scam group targeting widows on various social networks using false identities and other scam tactics. Police raid confiscated 48 laptops, 20+ phones, 8 wireless modems, and one vehicle. When questioned, they confessed to primarily engaged in dating scams targeting foreign widows, and have them send money with promises of love and marriage.

http://naijagists.com/20-yahoo-yahoo-boys-internet-scammers-arrested-in-benin-city-edo-state/

This is a growing problem as seniors, especially widows, are starved for attention and some simply are too naive to realize that "On the internet, nobody knows if you're a dog" (or a scammer). At least one Australian pensioner was found dead in South Africa after traveling there to find her "true love". Another was stopped TWICE at the Australian airport trying to travel to Africa, which horrified her daughter and the police detectives working the fraud cases. 

http://www.heraldsun.com.au/lifestyle/relationships/police-rescue-woman-from-flying-to-africa-to-meet-online-scammer/story-fni0dpm6-1226648699654

Reload Scam and Three Types of People Most Vulnerable to Scams

The Victim (novel)
(Photo credit: Wikipedia)

Do you know the three types of people most vulnerable to scams? You should. They are

• people who enjoy taking risks / gamblers
• people who were recently traumatized / grievers
• people who are doing not so well financially / debtors

If one person has more than one of these risk factors, they are far more likely to wade into scams.

People who recently learned that whatever suspicious scheme they had been engaged in was a scam and their money had been lost are especially vulnerable, as they exhibit all three factors.

1) They had to have enjoyed taking risks to join a suspicious scheme to start with. Either they are naive to start or they just don't know enough about the "scamworld" to know better.
2) Their ego had taken a tremendous shock upon realizing that it's a scam and they fell for it. They are eager to "prove" (either to themselves or to the world) that they can do better.
3) Their money loss can be significant, and they are eager to somehow "make up" the money. Maybe they didn't tell any one they had lost the kid's college fund or the "nest egg" they had been saving for years and was trying to make up for it in secret.

The three factors combine to make them ESPECIALLY vulnerable to scams, and both scammers and scambusters know this. Scammers have special scams just to target these vulnerable people. Scambusters call these "reload scams", where the victim got shot, but makes no attempt to escape, so the perp was able to reload and shoot the victim again (and again).