Overcoming Bias

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This is a blog on why we believe and do what we do, why we pretend otherwise, how we might do better, and what our descendants might do, if they don't all die.
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Robin Hanson
Aug 1, 2011
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This is our monthly place to discuss relevant topics not covered in recent posts.

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Overcoming Bias Commenter
May 15

S&P is in the news today.

Ideally, S&P would establish guidelines and judge companies and countries along those guidelines. They would say, for example, 30% debt to GDP is the max for triple AAA countries, downgrade countries higher than that benchmark, and upgrade countries below that threshold. The market and politicians would have a clearer idea of what behaviors will be penalized. There would be no shocks or surprises.

This is generally how S&P judges small countries and insignificant market transactions.

There is no 30% hypothetical, but they bent the rules for the US. S&P is not very popular today, but they've never been more powerful. Congress can't repeal S&P's special status since it would seem like punishment for S&P's action. S&P is also dictating terms to the White House, Treasury and Congress. Politicians are using this downgrade to further political ends vs the other party. S&P is the clear market leader, with Moody's, Fitch, and Egan-Jone in the rear. It at least seems like getting S&P's approval means more than approval from other rating firms.

Strict policing benefits insiders you said. Well, loose policing apparently benefits the police.

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Overcoming Bias Commenter
May 15

The women in my freshman year college dorm decided to have a "no-mirror" week to celebrate natural beauty and boycott societal norms. The initiator and main advocate was easily the most attractive woman in the 200-student dorm.

What's going on here? Is it simply that she had the least to lose? I suspect there is more here. Any insights would be appreciated.

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