The Downside of Liking

An old poker-playing maxim goes something like this: in every game, there’s a patsy (that pays for the other players). If within five minutes you can’t tell who the patsy is, you’re the patsy. It’s like that with all kinds of different enterprises: if you don’t know what the business is selling, they’re probably selling you.

With TV, radio, and newspapers we’ve known that all along. Ad revenues have a big part of their business strategy. That free newspaper that you pick up at the local convenience store isn’t free. They’re monitoring how many people pick it up, and using their circulation data to sell advertising.

It’s like that with Facebook, but a little creepier. “Liking” something is a public action. If I go to my Facebook page and tell people that I like the author Walter Isaacson, then I may get an email notice the next time he comes to the Northeast on a book tour. That’s not necessarily a problem. But if it turns out that people who like Isaacson’s biographies tend to be late on their mortgage payments, I may start getting offers for secured credit cards and financial counseling services. That just goes into the spam box: annoying, but not evil.

But I might be more concerned if a future employer or institutional client decides that Isaacson-likers just aren’t for them. And banks could start including likes and dislikes in their credit-scoring models. All this data is for sale. And there’s no law protecting various likers from discrimination. Privacy statutes in the US are relatively lax. In Europe they’re more strict—that’s why Facebook has issues with the EU. But over here it’s “liker-beware.”

Which puts a new twist on another old saying: be careful what you like—because you’re going to get it.

Douglas R. Tengdin, CFA
Chief Investment Officer
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By | 2017-07-17T12:34:57+00:00 February 16th, 2012|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. –
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