Scientific American: “Looking in the mirror and recognizing oneself was long thought to be an ability reserved for humans. Recently, however, researchers have found that other apes seem to show signs of self-awareness, including recognizing themselves in a mirror.”
“The standard measure of self-awareness is known as The Mark Test. In this experiment, researchers anesthetize an animal and attach a small red dot to the middle of its forehead. The dot will go unnoticed unless the animal can recognize itself in a mirror. When the chimps woke up and were given a mirror, they peered into the mirror while touching the red dot, indicating that they noticed the change in their appearance.”
Neuroscientists have used mirrors for many decades to measure self-awareness in all different types of animals. The majority of the time in most species, the individual is not aware that it is looking at an image of itself and thinks that it is actually gaining new information from another animal. However, Luis Populin, a neuroscientist at the University of Wisconsin, noticed that the Southeast Asian macaques in his lab appeared to be looking in mirrors to view their genitals.
Maybe we are descended from monkeys.
The Turing Test: If a machine can engage in a conversation with a human without being detected as a machine, it has demonstrated human intelligence. Perhaps that is why “bots” on Social Media often display more common sense than real humans.
However, for man or beast, mirrors can be tricky. Apes, exactly like humans, need to learn how to use a mirror. Babies, like animals, really enjoy looking at themselves in the mirror once they realize it is their own image.
Yet as author Linda Woolverton wrote, “Mirrors can be tricky things. Sometimes they display the truth, sometimes only a piece of it.”
American psychologist Abraham Maslow said: “I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail.” Abraham Kaplan, an American philosopher, perhaps said it better. “I call it the Law of the Instrument, and it may be formulated as follows: Give a small boy a hammer, and he will find that everything he encounters needs pounding.”
A problem that we face is that too many of the people we turn to for economic analysis and even advice spend—in my opinion—too much time looking in the mirror. Economist Paul Samuelson compared these analysts, and particularly central bankers to a monkey who “discovers his reflection in the mirror and thinks that by looking at the reactions of that monkey—including its surprises—he is getting new information.”
Then the Turing Test kicks in when the ‘expert’ thinks he or she is talking to a real live person when in fact, they are talking to themselves in a “mirror.”
Here is the example I have used so many times to explain why benchmark interest rates are of less concern to the average Filipino and to consumer spending. The vast majority of adults in the US—82 percent—have at least one credit card. In the Philippines, the percentage of people aged 15 years and above with a credit card is 8.75.
While ‘Online Loans’ and ‘Payday Loans’ are becoming more prevalent, these short-term loans are at typically higher interest rates because of the short approval time and that rate is not determined by the national benchmark rate but by how high the loan demand is.
If you are a traditional central bank mirror watcher—in the US —with the idea that ‘low rates are good and high rates are bad’, times are tough. Risk appetite is high. Net worth is at all-time highs, stock prices are at all-time highs, housing prices are at all-time highs, economic activity is at all-time highs, air travel is at all-time highs, and you can now earn 5 percent on your cash bank deposit.
If you are a traditional central bank mirror watcher—in the Philippines—with the idea that ‘low rates are good and high rates are bad’, you appear mainstream. Risk appetite is low even if your forecasts for the inflation rate and for GDP growth are way off.
“Monkey in the Middle” is a children’s party game, also played in economic circles.
E-mail me at mangun@gmail.com. Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis provided by AAA Southeast Equities Inc.