Debate 101

I seem to be attracting all sorts of obnoxious commentary over at — especially in the Columnist Conversation forum at Real Money. Its has been throwing off alot more heat than light.

Given my outlier status, I’m not surprised that my perspective has attracted some criticism. What did surprise me was the generally poor quality of debate:  personal attacks, rhetorical nonsense, misquoting, general bullshit. 

As one of (apparently) few people who Question the status quo; reads the actual BLS releases; considers how accurate the official statistics are;
I was kinda taken aback by how happily so many people were to sup at
the teat of government data, and to defend the status quo.   

Doug Kass tells me to suck it up. But that’s not my
style. And as I did the "slow burn" on the way home one night, this bit of
sarcasm was born. I posted it at columnist conversation, and then
thought it might be too inflammatory, and so suggested to an editor
that he might want to take it down.

But I enjoyed it too much to let it disappear. It was addressed to Cody, but he is not the primary offender — he was merely the last person to post

I have decided to repost a slightly edited version here:

Cody (and everyone else),

This evening, we will be discussing the basics of debate. This will be a brief and painless primer to facilitate further discussions.

Let’s start with the most basic concept. Anytime you post something in response to another author, you may find it helpful to actually read what that other person has written. Yes, I know it is time consuming, but you will find it an invaluable aid. Start slowly — when a person says BLACK, avoid accusing them of saying WHITE.

You will find that reading your counterpart’s positions will facilitate the discussion immnensely.

Another example: Consider responding to the person’s actual arguments. You may note that not many people do that. In one instance, someone seemed to have missed my entire point, and as far as I can tell, only recognized the word RIGOR. They chose to respond only to that word — and totally out of context, to boot. I must admit to total befuddlement.

Here’s an example of responsive debate I recently was involved in: I had disagreed with Jim Cramer’s comments that "the Bear case sounded more rigorous than the Bull case." For the record, Jim had written:

"[The Bears] certainly sounded more rigorous than the bulls, but that’s typical, too. It is a more rigorous position to argue the negative about virtually any aspect of the stock market because the market is based on faith . . . Plus, the rigor can easily be equated to delicious scare tactics that the bulls can’t muster."

I found Jim’s argument legitimate, but too cliched, and non-persuave. So using a classic debate technique handed down to us from the ancient Greeks: I actually responded to what he wrote.

Now, this apparently is a new concept for many of you, so I will go into more details at this juncture: You see, in many cultures, debate and rhetoric is a time honored way that ideas get discussed, refined, sharpened. By elaborating on the issues, considering all the facts, looking at arguments from different angles, a consensus — or at least better understanding — can be reached.

Yes, I understand that’s not how its always done around here. Sometimes, non-sequiturs seem to rule, and reading comprehension’s inexorable slide continues unabated. (Note: Inexorable means "relentless").

(What’s that? Oh, yes, thank you for pointing that out). Ahem. Where was I? Oh yes. Back to Debate 101.

An example of responsive debate and criticism would be how I addressed Jim’s writings. I wrote:

"I find it hard to say that the typically Bullish, sell side research analyst is not rigorous in their thought process. . . Further, some people see a day like today and claim its easy to "scare people out of the market." That’s simply one-sided nonsense. You can just as easily scare people back into the market. Its what happens in any strong rally, where people get panicked in and chase stocks up — happens all the time. Or how about a good old fashion short squeeze? Calling in borrowed stocks? Goosing index futures? Please, there are 100 ways to draw the moths to the flame."

I could have stopped there, but Jim had presented a powerful case, and I thought I needed a stronger response to counteract it: So I mustered additional arguments:

"Scaring the Bears is just as easy, if not more so, given the theoretical infinite losses on the short side. This is especially so when you consider all of the forces that line up on the Bullish side: Mankind’s natural progress, population growth, and technological development is the backdrop that has very strong Bullish tendencies. That’s not including the Wall Street machinery, the mutual fund industry, and whatever administration happens to be sitting in the White House — all of which have a strong incentive to accentuate the positive."

Take note of the techniques used here: What I did was address the facts, opinions and arguements Jim used in his comments.

This will be a novel technique for some of you, and you may initially experience some  discomfort when first using it. Not to worry, though, as you become more acclimated to this, you will eventually find your comfort levels will rise.

Some of the more observant of you may have noted that I did not attack Jim personally, nor did I misquote him, nor take his words out of context. I responded directly to the main thrust of his arguments with my own arguments.

Further, note how when I quote Jim, I use quotation marks (") to show that these are his precise words. I use ellipses (. . . ) to signify where I dropped a sentence or paragraph of his. Note that where I changed a word for grammer, I put it in brackets [].

But most importantly, do you follow how this whole "actually-responding-to-what-the-other-person-said-with-a counter-argument" works? Its become very popular in all the best places.

In a typical debate scenario, someone stakes out a position, gives facts as they see them, presents their theories, opinions, etc. Then the other person responds to that person’s arguments with facts countering the first persons positons. They poke holes in the theories, demonstrate why the facts may be different, weave a different analytical thread.

I will reveal a debate trick to those of you without rhetorical
training: this technique works best when you have a counter-argument of
substance. A combination of facts and the application of either logic or
historical analogy are the ideal set ups for using this fact based

This is what debate is. And I am compelled to point out that its been sorely lacking in Columnist Conversation, which is looking more like the Yahoo message boards of old. Its become a variation of the old trail lawyer’s saw:  "When the facts and the law go against you, make sure the jury knows the other lawyer is a jerk."

Obviously, this does not apply to everyone. In fact, it doesn’t apply to most people at RM. But given the reading comprehension problems I have since observed, I will repeat this sentence, and bold it: this doesn’t apply to most people here.

I have become the person at RM with the most defined and outlying market position. Those of you who know me know I enjoy mixing it up, discussing all sorts of things late into the night. I am happy to go over my positions, trades, arguments, etc. I certainly do not shrink from a fight.

However, as the outlier, I have become a lightning rod for all sorts of inappropriate and disappointing behavior, which I am putting an end to right now. Tonite’s Sarcasm Theater is my way of saying enough! No mas!

To be blunt, CC is becoming a giant time suck.I simply do not have the bandwidth for correcting each and every mean spirited attack.

So from now on, I will respond to CC’s that meet the ground rules for argument that the Greeks laid out for us 4,000s years ago: Honest, fact driven debate, fairly argued. For everything else, I will reference back to this post.

Even from a foe a man may learn wisdom . . .

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  1. MrMarket commented on Feb 20

    Most men would rather die than think. Many do. – Bertrand Russell

    The whole problem with the world is that fools and fanatics are always so certain of themselves, but wiser people so full of doubts – Bertrand Russell

    The aim of public education is not to spread enlightenment at all; it is to reduce as many individuals as possible to the same safe level, to breed a standard citizenry, to put down dissent and originality. – H.L. Mencken

  2. rtalcott commented on Feb 20

    All I can say is that if YOU are causing that much heartburn you are definitely attempting to raise the level of awareness over there….situational awareness I believe it is called.

    To me your points are pretty tough to argue with and I expect in the “longer term” (which is really not that long) you will be proven to be quite correct.

    I appreciate your taking apart the government released data which from my own personal experience seems to be total crap.

    People don’t like facing reality but soon they will not have a choice unless they are one fo the lucky few.

    See Vonnegut’s take,,1691370,00.html


  3. Globetrader commented on Feb 20

    Wonderful! It was sure time someone said so…but where do you get that hope from, what let you think, that a Prima Donna will read, what another Prima Donna wrote, if, by definition, it can’t be as important as her (his) own writings?

  4. Josh commented on Feb 20

    What do you expect from Cody? The guy learned his debate tactics from Stephen Colbert!

  5. Dan Green commented on Feb 20

    … And when we are highlighting that somebody else spelled a word wrong while in a fit of sarcastic rage, we will use [sic] to indicate that the author made the error.

    For example:

    “Note that where I changed a word for grammer [sic], I put it in brackets”.

    Thanks for the rant, Barry! I love stuff like this.

  6. waterboy commented on Feb 20

    I kinda separate economist blogs from trader blogs.

    Economists (on occasion) seem to invect their spew at the ideas of others.

    Traders are much better name callers. I don’t know if you consider yourself either.

    But birds of a feather… take a look at the names on the A-List for the WSJ’s “Taking Bernanke’s Measure” Party on Oct 24, 2005. You are a rare and brilliant bird of many feathers Barry!

    Your insight often stands above the rest.

  7. Barry G commented on Feb 20

    Have you posted a way for you to know that your wrong about your bearish thesis? You posted alot of charts and technical stats, but is there anything that will tell you’re wrong other then hindsight?

  8. B commented on Feb 20

    Any time your professional positions are in print, there will always be intense criticism. Not everyone will play by your rules or view such commentary as stimulating professional debate. Expecting such implies our belief system and needs system is shared by everyone. A great book on this topic written by a psychologist but the title is such that I’d be too embarrassed to post it on here. lol. Frankly, I love hanging around with people who have alternative views of life, politics or whatever. How do you ever learn anything if you aren’t surrounded by people smarter than you, with differing opinions than you or different backgrounds than you? I have an opinion on everything until it changes. lol. Most of the time it changes because someone has opened my mind to a new perspective or idea. But, most people are not comfortable to having their positions challenged. Psych 101. That is why bulls usually hang with bulls and bears with bears to break it into investing terms.

    But in the end, I look at it this way Barry. You got it going on. You are professional, polite and never personally chide anyone for their perspective. In the end, your friends are your friends. You can disagree and even argue but tomorrow you know you can call them and it’s all forgotten. Hey, let’s go grab a beer or let’s go bang a round of golf. That’s what it’s all about.

    Now that said, I have to comment on something Cramer said that puzzles me. Paraphrasing, “the bull’s position is based on faith.”. The only thing I do that’s based on faith is pray. I would expect such a statement from a home gamer. But, if you were a professional money manager, you better have some investment rules you live by. Faith and hope have no place in an investment manager’s vocabulary and it’s disconcerting someone doling out stock advice to millions feels that way.

    I hope it will go up.? I have faith the economy will do well? Professionals need a strong investment discipline as they have a fiduciary responsibility to their investors. Those with such cleaned house in the 70s and even 2000-2002 or if their charter didn’t allow them to do so, at least attempted an approach of capital preservation. Those who invested on faith had their clock cleaned. Not a personal attack on Jim but maybe that’s why he said the best positioned company in the stock market in 2000 was Sun Micro. That was a prescient call as it is only down 95%. Or maybe it was his calls after a 25% haircut in 2000 that the bloodletting was over and it was time to back the truck up and buy more speculative stocks. Only to watch them go down another 50%. My point is that I wouldn’t be too concerned with the softballs he may be lobbing your way. The path of a contrarian is a lonely but a richly rewarding one.

    Off to work. I’m done honing my typing skills. I should have been a secretary. 120 words per minute. :)

  9. ticker_tape_watcher commented on Feb 20

    Very interesting. I wonder what that says about the type of people that follow RM – daytrader’s only interesting in making a quick buck from hype?

  10. Michael commented on Feb 20

    The Street has a history of running off those who did not hold with the bull argument.

  11. John commented on Feb 20

    When you get to be my age you will realize that such effort is largely wasted and the time spent (even at 120 WPM) could be better spent if for nothing else than calling your bride and wishing her good health and godspeed on a glorious day.

    Said it before, say it again, Ne illigitemi carborundum est

    or something like that.

  12. Lord commented on Feb 20

    The comments of flamers speak for themselves and need no reply.

  13. pete Preissle commented on Feb 20

    Unfortunately, having jerks (polite word) take potshots at you goes with the territory.

    Open your psychological umbrella and let it direct the drivel into the gutters where it belongs.

  14. Anonymous commented on Feb 20

    What I find very difficult to understand is: Why is there so much sarcasm originating from both sides of the current debate on the status of the economy and markets?

    Does the sarcasm improve the arguments, either way?

  15. Anonymous commented on Feb 20

    Right on, Barry. I read a lot of investment-related articles from many different sources, and I have also noticed a trend where those with different viewpoints get spit upon by the euphoric majority. What can I say, people have lost any trace of civility these days, especially when it comes to money. I perceive this is a MAJOR sign of a top, people don’t want to hear any bad news period, even when it’s staring them in the face. But in the end, it’s a zero sum game, someone has to lose in order for you to win. The clueless uber-bulls that are calling you names that can’t explain their positions other than because “Jim said so” aren’t worth getting worked up over. They’re the ones who will crash and burn in the end, thanks to their arrogance, while you’ll come away with a hefty profit because you actually knew what you were talking about. My hat’s off to you as always.

  16. trader75 commented on Feb 20

    They say that living well is the best revenge.

    Wall Street version: PNL is the best revenge.

    Just finished Hedgehogging — excellent book, devoured it in less than 24 hours. Among the many great stories and players, Jeremy Grantham is one who stood out. The guy stuck to his convictions all through the bubble, endured all manner of ridicule and investor withdrawals.. and then cleaned up in spades. From 2000-2003, he rocketed past his peers “like we were standing still.” (Biggs’ words.)

    One of the most interesting lessons I’ve drawn from books like Hedgehogging is that the best frequently lag the market in the short term, even as they beat the pants off everyone else in the longer term. (Biggs has a section that goes into statistical detail on this.) It’s practically a required function of conviction and foresight to be standing off by yourself.

    Einstein observed that “great men have always experienced violent and terrible opposition from mediocre minds.” Being dumped on doesn’t automatically confer greatness, but maybe it indicates the trend is right…

  17. angryinch commented on Feb 20

    I’m a little confused why the bully boys on are so worried about a little lone bear slipping in a few zingers on their site.

    If I was thoroughly convinced that the market was heading to the sky, I’d just chuckle at those who were predicting gloom and doom. I’d say, “Short at will, Pancho. Be my guest.”

    Looks like their bullyness is mostly bravado hiding quite a bit of doubt and fear. So they have to shout down anyone who believes otherwise.

    As Billy Shakespeare put it, “Methinks they doth protest too much.”

  18. blue][erring commented on Feb 20

    i’m surprised you would think “most people here” aren’t good debaters?
    just kidding, excellent rantburst. welcome to my home town, the silicon V… wait a minute, what the burst are you doing here, now? don’t answer that.

  19. Bob J commented on Feb 21

    As a long time reader of realmoney it seems that in the past couple of months many of the contributors seem to be on edge. The bears are very bearish. The bulls are very bullish, and each seems to feel it necessary to convince the other how wrong they are. So we seem to be at a point where the market could either take off, or crash. Or it could do the most, to hurt the most, by just going sideways. But I would say that the real reason for the increased level of frustration is that the bulls aren’t making money and the bears aren’t making money, so who the hell is making all the money! The give and take in CC is very valuable to show us different viewpoints from people we can respect. It has come to the point though that respect is not being shown and it is affecting the quality of realmoney. With Cody and the Rev becoming more vocal about the superiority of their positions, and the website “improvements”, I’m finding I’m spending less time there and more on blogs like yours. That isn’t what I paid good money for!

  20. Barry Ritholtz commented on Feb 21

    Agreed — Blue ][erring, I was referring to RM, and not the Big Picture.

    As to Palo Alto, no, not Burst related (they are in Santa Rosa). This is RCP related . . .

  21. Eclectic commented on Feb 21

    It seems to me that the most difficult thing to recognize within ourselves is: When does our need to be right in a particular way, merely for the sake of being right ‘in that way only,’ supercede our need to be right in the right way?

    In other words; how long will an intelligent, rational person hang on to an opinion that he himself is beginning to question? Does the v-o-r-a-c-i-t-y of a long-held opinion blockade one’s ability to recognize a change that’s before him?

    This is the question I’m asking myself at the moment.

  22. Doc Dan commented on Feb 21

    Barry, concerning debate, rhetoric, logic…..

    I think you would enjoy “Crimes Against Logic” by Jamie Whyte. It’s a small book but well worth multiple reads.

    Hang in there. I’m confident the silent majority appreciates your effort to expose the truth.

  23. Paul commented on Feb 22

    From CNN money 2/21: Investor confidence sinks to record low

    “The U.S. financial services firm said its State Street Investor Confidence Index, based on actual fund flows among clients, fell to 73.4 in the month from 77 in January, upwardly revised from 76.

    “It was the lowest figure since State Street began compiling its index in September 1998.”


    “Investment bank Merrill Lynch said last week that investors in its monthly fund manager survey had begun to show signs of caution, raising allocations to safe-haven cash and trimming risk in portfolios.

    “Reuters asset allocation polls at the end of January also showed investors trimming their heavy allocations in equities and raising cash and bond holdings.

    “State Street’s indexes are based on the actual buying and selling patterns of thousands of institutional investors whose $9.8 trillion in assets State Street administers as custodian.”

    Too many people think TV pundit shoutfests are the model for debate, even in written form.

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