Maybe too re-known by the HN audience, to be "news", but in the classic "Innumeracy: Mathematical Illiteracy and Its Consequences" by John Allen Paulos there is a part, titled "A STOCK-MARKET SCAM" where the point is extremely well-made (the simplified scam described is a way to make a relatively small number of people believe that 6 consecutive weekly stock market predictions were accurate):
"If this is done knowingly and with intent to defraud, this
is an illegal con game. Yet it's considered acceptable if it's done unknowingly by earnest but ignorant publishers of stock newsletters, or by practitioners of quack medicine, or by television evangelists. There's always enough random success to justify almost anything to someone who wants to believe."
and, later:
"There is a strong general tendency to filter out the bad and the failed and to focus on the good and the successful. Casinos encourage this tendency by making sure that every quarter that's won in a slot machine causes lights to blink and makes its own little tinkle in the metal tray. Seeing all the lights and hearing all the tinkles, it's not hard to get the impression that everyone's winning. Losses or failures are silent. The same applies to well-publicized
stock-market killings vs. relatively invisible stock-market ruinations, and to the faith healer who takes credit for any accidental improvement but will deny responsibility if, for example, he ministers to a blind man who then becomes lame."
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[ 4.6 ms ] story [ 20.0 ms ] thread"If this is done knowingly and with intent to defraud, this is an illegal con game. Yet it's considered acceptable if it's done unknowingly by earnest but ignorant publishers of stock newsletters, or by practitioners of quack medicine, or by television evangelists. There's always enough random success to justify almost anything to someone who wants to believe."
and, later:
"There is a strong general tendency to filter out the bad and the failed and to focus on the good and the successful. Casinos encourage this tendency by making sure that every quarter that's won in a slot machine causes lights to blink and makes its own little tinkle in the metal tray. Seeing all the lights and hearing all the tinkles, it's not hard to get the impression that everyone's winning. Losses or failures are silent. The same applies to well-publicized stock-market killings vs. relatively invisible stock-market ruinations, and to the faith healer who takes credit for any accidental improvement but will deny responsibility if, for example, he ministers to a blind man who then becomes lame."