The difference between analysis and conspiracy theory | Muddy Water

Published (HKT): 2021.02.24 09:45

After all the social and economic changes over the past two years, one can easily find that many people are unable to distinguish between an analysis and a conspiracy theory.

Let’s have a test on your analytical ability. I have recently talked to a friend who is in finance. He said: “Currently China-US relations are not particularly good. So, many Chinese concept stocks listed in the US have moved to the Hong Kong stock market. To increase the valuation of these stocks when they are listed in Hong Kong, many mainland funds are purposefully speculating on Hong Kong stocks. This way, these stocks can enjoy a higher valuation as they return to the Hong Kong stock market.”

Is this argument an analysis or a conspiracy theory? The first thing to look at is the feasibility of what is suggested. “Purposefully speculating on Hong Kong stocks” forms the core of the argument. But it is not easy to prove that. From a rigorous scientific point of view, this argument is not valid.

However, that is not to say the argument is a myth. First and foremost, it is possible to invalidate or verify the argument. From the perspective of social science, we can extract some data, treat Sino-US relations as a factor and then look at changes in the Hong Kong and mainland stock markets. While I believe the data will not lead to an effective R-square value, technically at least there is a possibility to invalidate the argument.

We have got used to hearing conspiracy theories. For phenomena that cannot be explained, we tend to get into an esoteric mode of thinking and try to find an answer from mysticism. Now deep state is a popular topic. I am inclined to believe deep state is a clique in which people with political interest collude with the technological hegemony, rather than a group of lizard people and the Freemasons controlling the US.

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