The Sunday Brew #102
The Sunday Brew #102
In this brew - Global Growth Forecast in a picture | Streetlight Effect & Belief Bias | BRICS Summit, 23andMe Uncertainties and OpenAI gets first Chief Economist
Welcome to The Sunday Brew, weekly 1-2-3 newsletter by The Percolator. Every Sunday we drop in your inbox 1 story in a picture, 2 concepts, ideas or frameworks to expand your horizons and 3 news from the week, to keep you updated.
If you are not a paid subscriber, here is what you missed last week:
We want to know you better, so that we can do better for you
Please complete this short survey to let us know who you are and how we can improve The Percolator for you.
ONE STORY IN A PICTURE
TWO IDEAS, FRAMEWORKS OR CONCEPTS
This week we bring to you two concepts - Streetlight Effect & Belief Bias
Streetlight Effect
The Streetlight Effect, also known as the drunkard's search principle, refers to a cognitive bias where individuals or organizations tend to search for answers in the most convenient or accessible places rather than where they are likely to find the truth.
This phenomenon is illustrated by a well-known anecdote about a drunk man who loses his keys in a dark area but searches for them under a streetlight simply because it is brighter there. When asked why he is looking in that spot, he admits that he lost them elsewhere, highlighting the illogical nature of his search strategy.
This effect can lead to significant shortcomings in decision-making and problem-solving across various fields, including science, marketing, and everyday life. For instance, researchers may focus their studies on easily measurable data rather than exploring more complex variables that could yield deeper insights. Similarly, in marketing, professionals might rely on readily available metrics that may not accurately reflect the true performance of their strategies.
The Streetlight Effect emphasizes the importance of thorough investigation and critical thinking. It serves as a reminder that ease of access does not equate to relevance or accuracy.
To mitigate this bias, individuals are encouraged to adopt a more comprehensive approach to their inquiries, seeking information beyond the obvious sources and being open to exploring less illuminated areas that may hold valuable insights.
🚀
Belief Bias
Belief Bias is a cognitive bias that affects how individuals evaluate the validity of arguments based on their preexisting beliefs rather than the logical structure of the arguments themselves.
This phenomenon leads people to accept conclusions that align with their beliefs while rejecting those that contradict them, regardless of the actual strength or validity of the arguments presented. When faced with a syllogism—a form of reasoning consisting of two premises and a conclusion—individuals often allow the plausibility of the conclusion to cloud their judgment.
For instance, if someone believes that "all flowers are beautiful" and hears the argument, "Roses are flowers; therefore, roses are beautiful," they may accept it as true because it aligns with their belief, even if the premises do not logically support the conclusion. Conversely, they might reject a valid argument that contradicts their beliefs, such as "All birds can fly; penguins cannot fly; therefore, penguins are not birds," despite its logical validity.
Belief bias is particularly pronounced in emotionally charged topics, such as politics or religion, where deeply held convictions can significantly influence reasoning. Factors that contribute to belief bias include time pressure, lack of knowledge about a topic, and the complexity of the argument being evaluated.
Under time constraints, individuals are more likely to rely on their beliefs rather than engage in thorough logical analysis.
To mitigate belief bias, individuals can practice critical thinking by questioning credible conclusions and focusing on the logical validity of arguments rather than their believability.
THREE NEWS FROM THE WEEK
BRICS Summit Concludes in Kazan, Focusing on Global Cooperation and Economic Stability
The 16th BRICS Summit concluded recently in Kazan, Russia, bringing together leaders from Brazil, Russia, India, China, and South Africa to discuss pressing global issues.
The summit, which took place from October 22 to 24, was marked by significant bilateral meetings and a collective commitment to enhance cooperation among member nations.
One of the key highlights was Indian Prime Minister Narendra Modi's bilateral talks with Chinese President Xi Jinping and Russian President Vladimir Putin. These discussions aimed to foster stronger ties and address regional tensions, particularly the ongoing border disputes between India and China. Modi emphasized the importance of "border peace, mutual trust, and respect" as essential for regional stability.
The summit culminated in the signing of the Kazan Declaration, which outlines a roadmap for future collaboration among BRICS nations. The declaration addresses critical issues such as global economic stability, climate change, health preparedness, and the need for a local BRICS currency to facilitate trade among member states. Leaders expressed their commitment to reducing reliance on Western financial systems and enhancing intra-BRICS trade.
Russian President Vladimir Putin highlighted the emergence of a multipolar world order during his address at the summit. He underscored the necessity for BRICS nations to work together in addressing global challenges, including conflicts in West Asia and the ongoing crisis in Ukraine. The summit also served as a platform for discussing the role of BRICS as a voice for the Global South, advocating for equitable representation in global governance institutions.
As BRICS continues to expand its influence on the world stage, this summit reinforced its commitment to fostering economic growth and cooperation among emerging economies. The discussions held in Kazan are expected to shape the future trajectory of BRICS as it navigates an increasingly complex geopolitical landscape.
➖
23andMe Faces Bankruptcy: Users Fear for the Future of Their DNA Data
23andMe, a prominent player in the genetic testing market, is facing imminent bankruptcy, raising significant concerns about the security of sensitive DNA data belonging to millions of users.
Once valued at $6 billion, the company's worth has plummeted by over 97% since its public debut in 2021, largely due to persistent financial losses and a disastrous data breach that compromised nearly 7 million customer accounts in 2023.
The company has struggled to achieve profitability despite having served approximately 15 million customers over its 18-year history. Recent turmoil includes the resignation of its entire board of directors and ongoing legal challenges, including a $30 million settlement from a class-action lawsuit related to the data breach. With these developments, many users are increasingly anxious about what might happen to their genetic information if the company goes under or is sold.
23andMe's privacy policy indicates that in scenarios such as bankruptcy or asset sales, personal data may be transferred to new owners, which could lead to misuse or inadequate protection of this sensitive information. Legal experts have pointed out that federal laws like HIPAA do not cover data held by direct-to-consumer companies, leaving customers vulnerable.
As customers grapple with these uncertainties, some are taking proactive steps to protect their data. Deleting accounts is one option; however, experts warn that once DNA samples are de-identified and used in research, they cannot be retrieved. The situation remains fluid as CEO Anne Wojcicki contemplates taking the company private, but the future of both 23andMe and its vast stores of genetic data hangs in the balance.
➖
OpenAI Appoints First Chief Economist Amid Growing Focus on Economic Implications of AI
OpenAI has officially appointed Dr. Aaron "Ronnie" Chatterji as its first Chief Economist, marking a pivotal step in the organization's commitment to understanding the economic implications of artificial intelligence.
Chatterji, an esteemed professor at Duke University and former White House CHIPS coordinator, will spearhead research aimed at assessing how AI can drive economic growth and job creation. In his new role, Chatterji will explore various facets of AI's influence on the economy, including the global economic impacts of AI infrastructure and long-term labor market trends. OpenAI has expressed its belief that artificial intelligence has the potential to transform economies by enhancing innovation and productivity. The organization aims to leverage Chatterji's expertise to inform policymakers and businesses on maximizing AI's benefits while preparing for the challenges that may arise from its adoption.
Larry Summers, a member of OpenAI's board and former U.S. Treasury Secretary, emphasized the importance of Chatterji's appointment, stating that AI could revolutionize the economy much like electricity did in the past. He noted that Chatterji’s deep understanding of economic dynamics will be crucial in guiding OpenAI’s mission to create tools that foster growth and solve complex challenges.
Chatterji brings a wealth of experience to his new position, having served as a senior economist on President Barack Obama’s Council of Economic Advisers and held various roles within the Biden administration. His extensive research background includes over 30 peer-reviewed articles and two published books, focusing on strategic management and economics.
The Sunday Brew by The Percolator brings to you curated news on tech, business & entrepreneurship, from across the internet to give your week a perfect start.
Share your thoughts and opinions on the topics covered in this newsletter by leaving a comment and joining the conversation.