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Transcription of interview with Steve Novella on September 16, 2013.
Douglas Goldstein, CFPÆ, Financial Planner & Investment Advisor
Steve Novella is a clinical neurologist at Yale.
He is the president and co-founder of the New England Skeptical Society.
Douglas Goldstein, financial planner & investment advisor, interviewed Novella on Arutz Sheva
Radio.
Douglas Goldstein: What is Skeptical Society?
How did you involved in that?
Steve Novella: It is essentially a movement of group of people who are interested in science,
critical thinking, the public understanding of science and the relationship between science
and popular culture and pretty much everything that we do.
Itís essentially saying that people are easy to deceive, we deceive ourselves very easily,
our brains are very powerful flawed instrument.
So you need to have some kind of a rational critical thinking methodology to figure out
whatís true in the world and what isnít true.
Douglas Goldstein: How can people become critical thinkers?
Steve Novella: Like everything, itís a journey, itís not a destination.
I donít think thereís a binary thing where you would know whether you are or not critical
thinker.
There are people who are critical at different times and different situations or in different
degrees.
Pretty much everyone who goes to buy used cars probably is going to go to some critical
thinking.
Look at the tires, the mileage, they are not just going to automatically trust everything
used cars salesman tells to you.
In other times, maybe you might be a little less critical in your analysis maybe because
theyíre appealing to you or youíre not just aware that you should be more cautious, but
there is also a pretty extensive skill set involved.
Thereís a lot of knowledge how science works and logic and logical fallacies, all of the
various things that varies the way our mind works, the way our brain processes information,
the fallacies of human memory.
So knowledge of all of those things help you be more clear, rational, critical thinker.
Douglas Goldstein: How does trust fit in with that?
Do the
trust and critical thinking come together or do they never come together?
Steve Novella: More broadly, we are thinking of trust in terms of authority.
If youíre in authority on financial decision making and so people trust your authority
and make decisions based upon that and thatís a double edged sword to a critical thinker
because there are certain institutions people go to, consensus of scientific opinion for
example where itís a professional hard one consensus that deserves a bit of respect for
their authority, for their expertise but not surrender.
You always want to at least reserve the right to think about what youíre being told to
evaluate and to see if they actually does deserve your continued trust and also nothing
is infallible, nothing and nobody is beyond the ability to make a mistake so youíre always
opened to revision if new information comes down of height, that maybe the scientific
consensus is not correct, youíre willing to revise your opinion.
We donít generally recommend a complete rejection of all authority just as a knee jerk, thatís
more of a contrarian view, not really a skeptical view.
We do think that you do need to afford in the proper respect to proper expertise while
still reserving the right to judge things for yourself.
Douglas Goldstein: One of the problems with that for someone who is not necessarily a
professional in some area.
For example the issue of global warming, you speak to some people and they say every scientist
on the planet including the UN Board of 2000 Scientists says that weíre destroying the
environment and what do I know compared to 2000 scientists and then other people show
you information that seems quite the contrary.
As a layman, how can you figure out which way to go?
Steve Novella: Climatology is a very complex well-developed science.
Unless youíve worked with science or climatologist, you have absolutely no chance of understanding
the technical literature in sufficient detail in order to be able to make your own individual
judgment about what the evidence shows.
You have to stand years or decades studying something in great detail before you could
have the sufficient expertise where you could have your own opinion about it to be honest
with you.
Thatís where youíre forced to trust other scientist and the consensus of scientific
opinion so then the question becomes how do you know what the consensus of scientific
opinion is because different people will tell you different things about that and thatís
an art and skill set onto itself, knowing what kinds of institutions deserve to be taking
seriously, what kinds of institutions likely have an ideological acts to grind and you
should be suspicious of their conclusion.
Iíd be much more likely to believe in academic institution than I would say an ideological
institution thatís dedicated to [majoritarian] politics.
Their scientific opinions are more likely to be focused through their political ideology
than an academic institution but you can always think of potential [crosstalk].
You have
to listen to the consensus of scientific opinion and there are ways to evaluate that.
There are published studies that evaluate what scientists are saying and there are committee
of scientists whose job is to review the scientific evidence and to describe what it is and you
have to learn how to read those documents to see what they were really saying.
Itís an area where you are not an expert.
I do think that people need to have a basic level of scientific literacy.
If you donít have a sort of minimal level of civil scientific literacy then you really
have no chance, you canít even decide like who to believe and who not to believe.
If youíre working from a basic skill set of critical thinking and a basic scientific
literacy then you have a reasonable chance of at least understanding who to listen to
and is what their saying plausible, doesnít make sense or are there serious reasons to
doubt what their saying.
Thatís how you view it yourself but you can get there as among scientist if you
have those basic skill set.
Douglas Goldstein: You said people have to develop a basic skill set.
I write educational articles in plain English so that people can learn.
Even with all of that, you still find that people get scammed.
Steve Novella: Anyone can get scammed.
Thereís always somebody out there and know something you donít know and they can use
that knowledge to exploit your relative ignorance.
Being scammed doesnít mean youíre a fool, doesnít mean youíre stupid, it just means
youíre human and thereís just somebody out there who is just a little bit smarter than
you were and thatís everybody.
Thereís no way you can completely 100% protect yourself from ever being scammed, but you
certainly donít want to be an easy target.
You donít want to be the low hanging fruit for the scam artist out there and they are
out there and thatís where the basic critical thinking skill set comes into place.
Thereís a lot of generic rules that everyone will recognize like if it sounds too good
to be true, it probably is.
Youíll be amazed in how often people ignore that simple rule.
There is so-called red flag that you got to look out for.
If people are invoking like Bill Gates, some celebrity name or institution and if what
theyíre saying is full of hyperbole, if theyíre invoking conspiracy theories, those are the
things that con artists use in order to draw you in or to lure you in.
Just assume something is a scam right out of the gate and then until you prove that
instinct, thatís probably a good approach.
Just assume that this car dealer is trying to sell you a [inaudible 0:10:37] so you really
have to check out by your own mechanic or at least do some basic evaluation, look it
up on www.carfacts.com or whatever, there are websites where you can check.
The internet is a wonderful tool honestly if anything that gets presented to you if
you go in to Google and type that thing coma scam and just see what comes out, 9 times
out of 10, 99 times out of 100, somebody has already thoroughly investigated it before
you and weíll get you a detailed explanation of why it is or is not a scam.
There are websites dedicated to that.
You have to be able to live with your life and not just be consumed with it.
Before I invest half a million dollars in a stock, I would invest some time in investigating
whether or not itís real before somebody tells you that if it doesnít get any better
returns than the average on the market, I know thatís scam.
The market is designed to destroy information.
Anyone who really had secret information that they could use and beat the market, the market
would destroy that information very quickly.
So anyone who says that they could simply beat the market is either theyíll get insider
trading or theyíre lying or they self-deluded.
They just got lucky and now they think that their system works rather than their system
has worked or they just got lucky.
Half the people are going to do better than average by chance.
You could also say those people and then the next time half of them are going to be better
by chance so after 8 or 9 iterations a day, you still donít have a few percentage of
people whoíve done better than average the last 8 or 9 times theyíve made a big decision
and those people have to be up there even if every system is completely worthless so
you know just the fact that theyíve done well in the past.
Actually, it doesnít predict that theyíre going to do better in the future because those
people are out there who have done know by chance alone.
Thatís just statistics.
If you just cherry-picking of time and
you happened to be doing well, they can use that to make a case that their system works.
As you say, when you actually study these things long term, nobodyís got the magic
system.
Thereís no substitute for actual analysis, thereís no system, thereís no way to beat
the system with some mathematical trick or something.
Itís actually the hard work of actual analysis.
Douglas Goldstein: How can people follow your work?
Steve Novella: Probably the best way to get plugged in to all of the things that I do
is to go to the www.theskepticsguide.org and thatís the homepage of my podcast and from
there, you could find my blogs and other things that I produced.
I have done a couple of course for the Teaching Company and one is a really good overview
on critical thinking skills called Your Deceptive Mind.
Thatís kind of the portal into everything that I do.
Douglas Goldstein, CFPÆ, is the director of Profile Investment Services and the host
of the Goldstein on Gelt radio show (Monday nights at 7:00 PM on www.israelnationalradio.com.
He is a licensed financial professional both in the U.S. and Israel.
Securities offered through Portfolio Resources Group, Inc., Member FINRA, SIPC, MSRB, NFA,
SIFMA.
Accounts carried by National Financial Services LLC.
Member NYSE/SIPC, a Fidelity Investments company.
His book Building Wealth in Israel is available in bookstores, on the web, or can be ordered
at: www.profile-financial.com (02) 624-2788 or (03) 524-0942.
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