"The philosopher Hannah Arendt famously argued that the atrocities of the Holocaust were not caused by psychopaths but by ordinary people placed under extraordinary pressure to conform. Since then we have learned that the pressure need not be extraordinary at all. In fact, it may not be experienced as pressure, but as relief. Human beings are herd animals. We survive only in highly coordinated groups…The visible courageous individual is but the tip of a social iceberg. When you go against the group, you do it not on your own, but in the name–and with the backing–of another group. In other words, we can't avoid conformity."

From an Psychology Today article on conformity.

There's some interesting conjecture (some of it quantified) at the website indicated. Also interesting are the additional links provided to the tests done by Muzafer Sherif, Solomon Asch, and Stanley Milgram. Their "experiments", though limited in scope tend to support Arendt's contention that our "individual courage is a manifestation of group convictions and affiliations." Despite our most strenuous objections, we are all conformists– even those opposing the dominant conformist opinion, are conforming to a nascent opposition conformist view.

While I find the theory depressing, it could, if enough information were collected, sifted for relevancy, and interpreted correctly, provide real market insights. The studies seem to indicated that the dominant conformist meme will eventually be supplanted by another early stage body of thought which, regardless of merit, will dictate the next opinion-shaping, market-controlling mind set.

I believe a current topic, Bernie Madoff, provides a good example. He seems to be taking his place with Nixon and McCarthy as men who have committed an unforgivable sin against their brothers. However, why does he deserve this?

Certainly he bilked many out of billions– most of them quite wealthy, most of them reaching for that extra little bit of yield not available to those amongst the hoi-polloi. Yet it is this group that is most regularly fleeced by financial fraud and misrepresentation. But it not unusual for the few perpetrators who are caught to receive a mild wrist-slapping and, within, an acceptable period, re-entered into their former sphere.

What seems to be overlooked is that many of those fleeced by Madoff (e.g., Cage, Bacon, Sedgwick) have ample time and opportunity to re- establish their wealth, or a goodly portion of it. The poorer victims of the less publicized bilkings quite often have neither the time nor opportunity (nor the sympathy) needed to come back.

The once-upon-a-time conformist meme was: "Thou shalt not steal."

Its more modern incarnation seems to be: "Thou shalt not steal from the wealthy."


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