Twitter, George Soros, and Porn
Subjective and Objective Realities
Ranjan here. Given this newsletter will be a critique of the salacious and hyperbolic, I promise I’ll work hard to justify that subject line. If this email made it through your spam filter, here goes nothing.
Over the past few months, I've noticed a trend. I get tweets sent to me by friends who were never previously on Twitter. My media+tech friends have shared tweets forever, but for the non-media+tech folks, it slowly started after Trump’s election and has exploded since COVID hit. Links to tweets are consistently showing up in email threads, messaging groups, and text chains. In particular, one of my good friends, who I'd consider incredibly smart/well-informed/well-read, started regularly sharing tweets with me in April. In years of online banter, he had never previously shared a tweet.
He was sitting at home in quarantine in a state with almost zero cases. Unlike in NYC where you heard endless sirens and heard horrifying stories from your doctor friends, he couldn’t “see it” directly. He also told me he didn't feel like he was getting reliable information from traditional media and had downloaded Twitter to try to find better information 🤯🤢. COVID is the most fast-moving, earth-shattering, difficult-to-comprehend thing imaginable and he logged onto Twitter for the first time in his life to find information about it.
It was frustrating when he sent me the first Alex Berenson tweet. Then a link to a tweet with a John Ioannidis video. Contact tracing is pointless, Sweden is doing it right, I should just look at the Georgia and Florida numbers, and so on.
I get it. He downloaded an app and assumed it worked as advertised. As Twitter proclaims on their landing page, they would help you “See what’s happening in the world right now”. As he sat at home, completely devoid of any non-digital contact with the outside world, he shaped his idea of reality through endless tapping and scrolling, with no real background on the underlying dynamics and mechanics of the app. He was just looking for better information.
A terrifying part of pandemic life is thinking about how, for so many of us, our understanding of reality is increasingly being shaped by algorithmically-curated, ad-funded digital representations. We trust the platforms to let us know “what’s happening right now” because we can’t be out there seeing it for ourselves.
Highly Exaggerated Outliers
Okay, how do I do this without making things too uncomfortable? Again, here goes nothing.
For any of you that may have ever perused a pornography website, you may have noticed the scenarios getting increasingly preposterous over the years. Multiple partners and medically improbable appendages are the base case. I am cognizant that the situations presented are not representative of ‘real life’. They are not representative of typical sexual relations. I'm sure the scenarios presented on porn sites really do happen sometimes, but they're highly exaggerated outliers.
I’ve been a tech platform cassandra for my non media+tech friends for a few years now, but trying to explain how ad-based business models and algorithms combine to create a completely distorted understanding of reality has been difficult. The one thing that almost instantly breaks through is to equate the reality presented in a social feed to porn. Yes, the things you are presented with are real and do exist, but they are not representative of the mundane nature of everyday life. Again, highly exaggerated outliers.
In the same way none of us are going to pornhub and searching "suburban pudgy 40something couple missionary" (maybe you are and kudos to you) the algorithm does not promote the uninteresting and the unstimulating. If there is any censorship on these platforms, it’s of the tedious and routine elements of life.
To look at your Facebook, Instagram, or Twitter feed as representative of reality is to look at Pornhub and think "this is how most people have sex".
Reflexivity and Reality
Okay, I think I made it through that last section alive. Definitely new territory for a Margins piece. That wasn’t so bad, was it?
Even before the pandemic, most of us equated what we see on our feeds to a general sense of reality. But this was tempered because we actually went out and lived life. We had interactions and experiences to inform our understanding of objective reality. For those sitting at home, the feed now represents life.
And this is where we need to bring in George Soros.
Not the fire-breathing, cabal-funding Soros but the hedge fund manager Soros who is a brilliant financial thinker. The central framework he crafted for thinking about the financial markets (and life in general) is his theory of reflexivity. How Soros defines it himself:
“The concept of reflexivity is very simple. In situations that have thinking participants, there is a two-way interaction between the participants’ thinking and the situation in which they participate. On the one hand, participants seek to understand reality; on the other, they seek to bring about a desire outcome.
The two functions work in opposite directions: in the cognitive function reality is the given; in the participating function, the participants’ understanding is the constant. The two functions can interfere with each other by rendering what is supposed to be given, contingent. I call the interference between the two functions ‘reflexivity.’ I envision reflexivity as a feedback loop between the participants’ understanding and the situation in which they participate.”
It's a bit of a heavy explanation of what I consider a simple, yet profound, idea. A movement in a stock price is theoretically supposed to reflect expectations about the future fundamentals of a business, but that very movement in stock price can transform the eventual fundamentals. It's a two-way feedback loop. Think about it this way:
Conventional financial thinking tells us that if Google’s stock price goes up it’s reflective of future financial success.
But when Google's stock goes up, it will attract more talent, the debt market will let Google raise debt at even lower rates, and it makes it a more attractive acquirer for up-and-coming companies.
That rising stock price will help shape Google’s future financial performance.
It's one of those things that's almost painfully obvious when written out, but it’s an insight that runs counter to most traditional finance and economics (and managed to make Soros a few yards). It’s a simple recognition of a feedback loop where a representation of a particular reality (a stock price) has a direct impact on that eventual reality (future earnings). A stock price that is rising because of positive future expectations can in fact play a big part in shaping that positive future.
Is Twitter Real Life
Back to social media. There has been plenty of insider-y debate around "Is Twitter real life?" but I think it misses one crucial element:
Social media is not real life, until it is.
A few years ago, rainbow bagels were not a thing. Then, a bagel store in Brooklyn quickly grew a huge following on Instagram thanks to viral photos of rainbow bagels. As a longtime New Yorker, I can safely tell you rainbow bagels are in no way representative of bagel reality. Rainbow bagels would be the bagel equivalent of an outlandish porn scenario. But thanks to that Brooklyn-based viral rainbow bagel they are now a real thing, from Edinburgh to Atlanta.
That is Soros’s reflexivity in action. Social media is supposed to show us what’s happening in the world, but in attempting to do so, it can change what actually happens.
Facebook is not bad because people are bad and it’s just reflecting how people are. It is not an accurate representation of reality. Twitter is not “what’s happening in the world right now”. But the more we turn to algorithmic feeds built by companies drowning in advertising profits to help us shape our understanding of reality, the more those feeds become our reality. The more the porn-like outliers become real. We get Trump and rainbow bagels. We get the year 2020. Remember when it suddenly felt like everything was getting crazier and things were moving faster.
Things really are moving faster and getting crazier. At least I think they are.
Note 1: Margins is not just about complaining and ranting! In fact, we provided a five-point plan to fix social media in our early days!
Note 2: As the parent of two very young kids, I am pretty terrified if their introduction to understanding human sexual relations is eventually based on internet porn. I feel a bit old-man-yells-at-cloud, but seriously, how do parents of teenagers deal with this stuff? An equivalent, but more Rated-PG fear worth discussing is:
Note 3: Soros presents this theory in the Alchemy of Finance. It's an incredible book that I’d highly recommend - though I'd argue Soros's true crime, rather than funding secret child pedophilia rings or whatever, is writing in an overly dense and complicated manner.
Soros' Reflexivity Theory is very reminisicent of post-structuralist theories of intertextuality in literary theory. The basic idea is that every work of literature is simultaneously a product of its context, and provides context for other works, creating a constant dialogue. It's notable that this idea was developed in the 50s and 60s, around the time that Soros will have been developing his own ideas about theories of finance.
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