Art of Contrary Thinking Read online

  THE ART OF CONTRARY THINKING

  BY THE SAME AUTHOR

  Tape Reading and Market Tactics (New York: Forbes Publishing Company, 1931). Reprints from Fraser Publishing Co., Wells, Vt.

  Understanding American Business (New York: The Macmillan Company, 1939).

  Forty-eight Million Horses (Electrical Industry) (Philadelphia: J. B. Lippincott Company, 1940).

  The Inside Story of the New York Stock Exchange (New York: B. C. Forbes & Sons Publishing Co., Inc., May, 1950).

  It Pays To Be Contrary (a pamphlet, 1951, which becomes a part of the present volume).

  Neill Letters of Contrary Opinion.

  Fraser-Neill Letters of Contrary Opinion, Wells, Vt.

  THE ART OF

  Contrary Thinking

  by

  HUMPHREY B. NEILL

  (The Vermont Ruminator)

  It Pays To Be Contrary

  CAXTON PRESS

  CALDWELL, IDAHO

  2003

  First printing, January 1954

  Second printing, March 1956

  Third printing, January 1960

  Fourth printing, July 1963

  Fifth printing, August 1967

  Sixth printing, September 1971

  Seventh printing, December 1976

  Eighth printing, July 1980

  Ninth printing, August 1985

  Tenth printing, December 1992

  Eleventh printing, October 2001

  Twelfth printing, August 2003

  COPYRIGHT 1954, 1956, 1960 AND 1963

  THE CAXTON PRINTERS, LTD.

  CALDWELL, IDAHO

  Lithographed and Bound in the United States of America by

  CAXTON PRESS

  Caldwell, Idaho 83605

  169965

  To Contrarians and Libertarians everywhere. May their numbers grow!

  TABLE OF CONTENTS

  THE ART OF CONTRARY THINKING

  BEFORE YOU BEGIN—

  SECTION I—IT PAYS TO BE CONTRARY

  SECTION II—ESSAYS PERTAINING TO THE THEORY OF CONTRARY OPINION AND THE ART OF CONTRARY THINKING

  Waves of Mass Sentiment

  The Investors’ Dilemma

  Habit

  The Psychology of Inflation

  When There Is No Public Opinion

  Imitation of the Minority

  For Your Notebook

  On Being Contrary to the Gregarious Opinion

  The Theory of Contrary Opinion Is a “Way of Thinking”

  Thinking By Accident

  Put the Cart Before the Horse

  Law of Universal Inequality

  Propaganda

  Realism: The Contrary Challenge of the New Year

  How Economists Sometimes Make Their Predictions Go Wrong

  Ask “What’s Right?”—Instead of Always “What’s Wrong?”

  Mass Psychology and the Campaigns

  Social Psychology

  Economic Psychology

  Looking Back

  An Historic Return to Gold

  Contrary Events from History

  Tidal Movements

  Much to Learn

  On Predicting the Unpredictable

  “Crowd Upset” Favors Eisenhower

  Money Minds

  Why Forecasts Go Haywire

  Revolutions Require the Long View

  Theory of Contrary Opinion Hinges on Laws of Imitation and Contagion

  Where Will Mass Conformity Lead?

  The Theory of Contrary Opinion Deals with Delusions and Mass Misconceptions

  Looking Two Ways at Once

  The Ticklish Business of Forecasting

  What’s the Use of It All?

  Maybe Some Old Theories Are Still Valid

  “Neutralism”—in Economic Writing

  Be a Nonconformist in Your Thinking

  More on Socio-political Trends

  Thinking Humanistically As Well As Realistically

  Thinking in Circles

  “… Still Doesn’t Know What Makes Him Tick”

  Three Types of “Opinions”—Thoughtful, Thoughtless, Emotional

  How Opinions Are Formed

  Read-and-Needle Is the Contrary Way

  The Theory of Contrary Opinion and the “Triadic Law”

  “Social Pressure Often Breeds Conformity”

  Momentum

  More on the Contrary Approach to Creative Thinking

  Motives and Movements

  Mass Mesmerism

  … Again on the Question: “Is the Public Always Wrong in the Market?”

  The Problem of Knowing and Measuring Opinions

  The Law of Mental Unity of Crowds

  The Theory of C. O. Is Not a System of Forecasting: It Is a Method of Working Toward Thought-Out Conclusions

  “Why Do You Think You Think?”

  Let Us Be Contrary: Let Us Not Deny That Our Destiny Lies in the Skies

  Capitalism’s Basic Factor: Earning Power

  A Libertarian Surely Has To Be a Contrarian These Days!

  A Fallacy in Economic Extrapolation

  How To Look Ahead—Profitably

  Is There Any Real Purpose in Contrary Thinking?

  Limbering Up Your Mind

  A Money-Mind Versus the Impetuous Impulse To Make Some Easy Money

  Communists Practice the Theory of C.O.

  The Right Word (or Thought) May Be Worth a Thousand Pictures

  A Think-It-Out-For-Yourself Kit

  Opinions and Words Versus Facts

  The Years Forecasters Would Like to Forget

  Quick to Conform, but Slow to Differ

  Forty-One Years of “Unexpected” Events

  Epilogue: Slaves to “They,” by Samuel B. Pettengill

  THE ART OF CONTRARY THINKING

  THE ART OF contrary thinking may be stated simply: Thrust your thoughts out of the rut. In a word, be a noncomformist when using your mind.

  Sameness of thinking is a natural attribute. So you must expect to practice a little in order to get into the habit of throwing your mind into directions which are opposite to the obvious.

  Obvious thinking—or thinking the same way in which everyone else is thinking—commonly leads to wrong judgments and wrong conclusions.

  Let me give you an easily remembered epigram to sum up this thought:

  When everyone thinks alike, everyone is likely to be wrong.

  In order to stimulate your interest in the subject of this pamphlet—namely, the art of contrary thinking—let me offer this second thought: If you wish to keep from guessing wrong, learn to think contrarily.

  In the pages that follow you will find in the first section (titled “It Pays to Be Contrary”) a running story of the Theory of Contrary Opinion. In the second section you will find a series of brief essays covering ideas pertinent to contrary thinking.

  In presenting the subject in this manner I think you will find it broken down in such fashion that it is not only easily reviewed but also, I hope, somewhat entertaining to read.

  From long study of mass movements and public psychology there is no question in this writer’s mind that if one trains his mind to think opposite to the herd he will be right more often than wrong. In other words, concerning most subjects it is pretty safe to say that “the crowd is usually wrong”—at least, in its timing of events.

  Please do not misunderstand the saying “the crowd is wrong.” I do not mean that people are wrong in their philosophies concerning their everyday living. What I refer to is this: When masses of people succumb to an idea, they often run off at a tangent because of their emotions. When people stop to think things through, they are very sane in their decisions. It is when some occurrence arises that h
as wide emotional appeal that you find “the crowd going wrong.” You perceive the significant difference, I’m sure. In one case people act as “a crowd” and in the other as individuals.

  History books relate countless manias that reflect the peculiarities of crowd-action. Several of these will be referred to in the following pages.

  You will find that most of the references and discussions in this pamphlet have to do with economic and financial subjects. However, the reader should be reminded that the art of contrary thinking is applicable to almost any subject. It is applicable to arguments in philosophy and frequently applicable to politics. In politics, obviously, those who are running for office are after the popular vote. Candidates who are skilled in the use of crowd psychology will call into play all of the various tricks which arouse people’s emotions and desires.

  What it comes down to in the final analysis is that a “crowd” thinks with its heart (that is, is influenced by emotions) while an individual thinks with his brain. This is no reflection on any individual because, when any of us are grouped in a crowd, we are likely to lose our balance, you might say; we become one of a group rather than remain as an individual. You’ve often heard it said that so-and-so “lost his head”—or that “his heart ran away with his head.”

  This writer believes the great lack in economic and political studies is the failure to analyze human nature. How people think and how they act are too often overlooked when we are trying to project a future pattern. Human behavior is fully as important as, if not more important than, statistical behavior. I believe that the human figure, in other words, is fully as important as the mathematical figure in our calculations concerning economic trends and socio-political trends.

  Over the past thirty years we have had what amounts to a complete social revolution.1 People think differently today from the way they did, say, prior to 1929; that is, prior to the Great Depression and the New Deal. When you stop to think of the millions of young people whose judgments and perspectives in life have actually been formed since the advent of the New Deal—the advent of the social revolution—you see at once how differently one has to look at questions today from the way he would have looked at them in former times.

  While this writer is fond of reading and studying history, nevertheless, when reading history, one has to adapt his thinking to modern interpretations. It is said, you know, that “history repeats.” This is an accurate saying, but you will find that whereas history does often repeat, it never seems to repeat in exactly the same manner or in the same fashion.

  One can learn a vast amount concerning the subject of mob psychology by studying past manias and past episodes, but in each case it is important to analyze the impetus which motivated the particular mania, or the fad which overtook people at a given time.

  For example, one would not expect another land boom and mania in Florida with characteristics similar to the land boom which occurred in Florida in the mid-twenties.

  Another example from more recent times would be the successful political campaign which former President Harry S. Truman conducted in the fall of 1948. At that particular time his tactics and his strategy—all of which, by the way, were in full accord with the principles of mob psychology—those tactics probably would not work again in just the same manner. Indeed, when he went out to support the Democratic candidate in 1952, Mr. Truman’s similar strategy was unsuccessful. Many observers felt that Mr. Stevenson, for example, might have had a better chance in 1952 if Mr. Truman had not tried to repeat his tactics of 1948. I am simply passing this along as an illustration of how the appeal to the crowd may work at one time, whereas at another it will have an entirely different result.

  To bring this introduction down to a conclusion, let me repeat:

  The art of contrary thinking consists in training your mind to ruminate in directions opposite to general public opinions; but weigh your conclusions in the light of current events and current manifestations of human behavior.

  It may appear to some readers as though the theory of contrary opinion, or the art of contrary thinking, is a cynical one. I do not think it is at all. I believe it is merely a matter of getting into the habit of looking on both sides of all questions and then determining from your two-sided thinking which is the more likely to be the correct version—which in turn leads to the correct conclusion.

  Finally, let me emphasize here the factor of propaganda. We are mentally swamped today with all forms of propaganda. It pours out in millions of words. Obviously, propaganda is for the purpose of influencing minds. Therefore, it is essential to look upon both sides of public and economic questions in order to avoid being entrapped by the propagandists.

  HUMPHREY B. NEILL

  Saxtons River, Vermont

  1 See Garet Garrett’s The People’s Pottage, and other Libertarian books, published by The Caxton Printers, Ltd.

  BEFORE YOU BEGIN—

  Here’s a brief summary of the theory of contrary opinion, from which the art of contrary thinking is developed.

  FOR A quick look, and to become acquainted with the theme of contrary thinking, prior to reading what follows, this brief summary is presented; it is an answer in as few words as possible to the question: “What is the Theory of Contrary opinion?”

  1. Primarily, it is a method of ruminating over a broad range of public questions; political, economic, and social. The object of contrary thinking is to challenge generally accepted viewpoints on the prevailing trends in politics and socio-economics. In sum, the purpose is to contest the popular view, because popular opinions are so frequently found to be untimely, misled (by propaganda), or plainly wrong.

  a. Experience with contrary thinking warrants the use of such sloganized expressions as these:

  When everyone thinks alike, “everyone” is likely to be wrong.… When writers write alike, readers are prone to think alike.… Too many predictions spoil the forecasts; or, to put it another way, the weight of predictions causes their own downfall. (What happens is that counteracting policies are adopted to offset, or by-pass the “expectancy.”)

  b. Caution: The contrary theory is a way of thinking, but let’s not overweigh it. It is more of an antidote to general forecasting than a system for forecasting. In a word, it is a thinking tool, not a crystal ball. It forces one to think through a given subject. As has been said: If you don’t think things through, you’re through thinking.

  2. Human traits that make the theory of contrary opinion workable, include:

  Habit

  Emotion

  Iritability

  Custom

  Greed

  Pride-of-Opinion

  Imitation

  Hope

  Wishful Thinking

  Contagion

  Credulity

  Impulsiveness

  Fear

  Susceptibility

  Conceit

  3. The theory is based upon “laws” of sociology and psychology, among which these are logically related:

  a. A “crowd” yields to instincts which an individual acting alone represses.

  b. People are gregarious; instinctively they follow the impulses of the “herd.”

  c. Contagion and imitation of the minority (follow-the-leader) make people susceptible to suggestion, to commands, to customs, to emotional motivation.

  d. A crowd never reasons, but follows its emotions; it accepts without proof what is “suggested” or “asserted.”

  Now, for an equally brief survey of some uses and examples of Contrary Thinking:

  1. Let me start out with a socio-political thought, as it may suggest a broader application than some reference to, say, a crowd stampede in the stock market.

  a. You will agree, I think, that socialism is kin to communism.

  b. Yet, millions of people (an immense “crowd”) who are socialistically inclined believe they are anticommunistic. They delude themselves. No greater (or more menacing) delusion prevails. Socialism leads to communism. To root out
communism it is essential to weed out socialism. This, admittedly, is a herculean task—one unlikely to be accomplished in our lifetime.

  The foregoing is an example of approaching a problem hind-end-to: the contrary approach. In all public questions which engage people’s minds the contrarian tries to see in behind the surface opinions (as above, that people fail to recognize the kinship between the two isms).

  2. Consider the contrary questioning of propaganda which is so prevalent today.

  a. It is the reasons behind, not the mere words in speeches, pronouncements, and articles which we have to seek. Why is the message circulated?—not simply what is in the message. Quite frankly, the contrarian needs to be cynical in this propaganda analysis, but so long as “opinion-makers” are out to sway and mold public opinion the only defense is “to doubt all before you believe anything”—and to look behind the words for meanings.