Friday, December 16, 2011

All You Need To Know About Rumours and Speculation (the Triple Filter Test)

This is a most important, funny but revealing story about the greatness of Socrates,. Somehow, it applies totally to the way stock markets operate, by and large .... rumours and speculation, how do we go about accepting them or filtering them.


Keep this in mind the next time you are about to repeat a rumour or
spread gossip.

In ancient Greece (469 - 399 BC), Socrates was widely lauded for his wisdom.

One day an acquaintance ran up to him excitedly and said, "Socrates,
do you know what I just heard about Diogenes?"

"Wait a moment," Socrates replied, "Before you tell me I'd like you to
pass a little test.

It's called the Triple Filter Test."

'Triple filter?" asked the acquaintance.

"That's right," Socrates continued, "Before you talk to me about
Diogenes let's take a moment to filter what you're going to say. The first filter is Truth. Have you made absolutely sure that what you are about to tell me is true?"

"No," the man said, "Actually I just heard about it."

"All right," said Socrates, "So you don't really know if it's true or not. Now let's try the second filter, the filter of Goodness. Is what you are about to tell
me about Diogenes something good?"

"No, on the contrary..."

"So," Socrates continued, "You want to tell me something about Diogenes that may be bad, even though you're not certain it's true?"

The man shrugged, a little embarrassed. Socrates continued, "You may still pass the test though, because there is a third filter, the filter of Usefulness. Is
what you want to tell me about Diogenes going to be useful to me?"

"No, not really."

"Well," concluded Socrates, "If what you want to tell me is neither True nor Good nor even Useful, why tell it to me or anyone at all?"

The man was bewildered and ashamed. This is an example of why Socrates was a great philosopher and held in such high esteem.

It also explains why Socrates never found out that Diogenes was shagging his wife.


solomon said...


Umw, naza or drb will pass the triple test for proton?

Ivan said...

^_^ wondering is khazanah purposely wanna someone help to push the "sotong" share from RM1.xx to RM 5.xx. .and. . year end portfolio - seem nice :)

Andy said...


bonny b said...

Methinks the old man is shagging Proton....

Hal said...

Note: "It also explains why Socrates never found out that Diogenes was shagging his wife."

Knowing this could be "useful" (the 3rd filter/test) to Socrates and thus this gossip/rumour passed one of the filters and should scrape through! ;)

Socrates could use this knowledge to sue the pants off Diogenes ... oops, wait a minute, ancient Greeks never wore pants!

Shihong said...

I would think that Diogenes shagging Socrates' wife would pass the 3rd test. It would be useful to know if Diogenes was shagging his wife wouldn't it?

emacro said...

For stock rumours 3 sets of triple filters

1 be skeptical, be skeptical, be skeptical
2 It's BS, BS, BS
3 Caveat emptor, caveat emptor, Caveat emptor

Clarence said...

I need help with the following questions
1) How can the information about his wife's infidelity be useful in the ancient days?
2) Though the Triple Filter Test is a good filter, would it in a certain sense promote ignorance? Wouldnt it be better to listen with an open but critical mind?

brotherlone said...

i thought Socrates once said

'only the unexamined life is worth living' whats this triple test all about?

Proton will be privatised... just look at the price movements and spike in volume... it started to move even before the news came out... Jesse Livermore would whack and punt his entire wealth on Proton...

Never buy a stock that has gone up with newsflow but a stock with unusual price movements and spike in volumes (without any newsflow) is worth a punt.

just be careful with the call warrants; Hirotako-WA is a very good case study, warrants shouldn't be priced at a premium above expected GO offer price. a GO for the mother price would essentially discount, expected future value of an option.

emacro said...

Categorically avoid call warrants, Convoluted + confusing they are, IMHO