Werewolves in Sheeps’ Clothing

A Lesson for US Politics [Morning Reckoning] September 12, 2024 [WEBSITE]( | [UNSUBSCRIBE]( Werewolves in Sheeps’ Clothing Frankfurt, Germany September 12, 2024 [Sean Ring] SEAN RING Hi Reader, Next week in Frankfurt, I’m teaching “soft skills,” which are interpersonal skills that enable effective communication, collaboration, and problem-solving. These skills cover a wide array of areas, such as presentation skills, negotiation skills, business writing skills, and other critical and transferable skills. I’m always looking for new games and simulations, as chalk-and-talk gets boring quickly. The only way to learn those skills is by doing them. During my research, I came across the most fascinating game I’ve ever heard of. It applies directly to what’s going on in the Western world. I’ll share it with you now. The Wolf at the Door The game "Werewolf" (or "Mafia," as it is sometimes called) is a social deduction game in which players are divided into two groups: the informed minority and the uninformed majority. The goal for each group is simple: survive and eliminate the other. However, what makes Werewolf fascinating is how it mirrors social dynamics, power struggles, and the subtleties of influence — dynamics that relate to modern U.S. politics. [Man Who Predicted Biden's Drop Out In October Issues Shocking New Election Prediction]( [Click here to learn more]( After calling Biden's withdraw, former White House advisor Jim Rickards issues an even more shocking election warning... [>> Watch This Video to Learn More <<]( [LEARN MORE]( The Origins of Werewolf Werewolf is a variant of the Russian game "Mafia," created by Dmitry Davidoff in 1986. Davidoff designed it as a psychological game to explore social behavior, communication, and the breakdown of trust in groups. Originally used in classrooms and psychology studies, the game rapidly gained popularity, spreading to parties and conventions and eventually spawning several iterations, including Werewolf. The premise of Werewolf is simple: a village is plagued by werewolves, and each night, one villager is killed. By day, the villagers must try to identify and lynch the werewolves hiding among them. The tension of the game arises from the fact that a small, informed group (the werewolves) knows who they are and coordinates their actions in secret. Meanwhile, the larger, uninformed majority (the villagers) must try to deduce the werewolves' identities through conversation, accusation, and often baseless suspicions. The Uninformed Majority In Werewolf, the uninformed majority is made up of regular villagers. Their only advantage lies in their numbers, but their disadvantage is their lack of knowledge. They don’t know who the werewolves are, so they must rely on intuition, social cues, and communication to uncover them. Throughout the game, villagers are vulnerable to misinformation, manipulation, and internal division, often turning on each other in desperate attempts to identify the wolves. This mirrors the challenges faced by the general public in political environments. In any society, most voters (the uninformed majority) don’t have access to the same level of information as political insiders, campaign strategists, or policymakers (the informed minority). John Q. Average decides based on limited information, media reports, political rhetoric, and, often, partisan bias. In this environment, misinformation spreads easily, creating confusion and mistrust. In recent U.S. politics, we’ve seen how easily the uninformed majority is misled. From the rapid spread of disinformation on social media platforms to the growing polarization of traditional media, voters are bombarded with conflicting messages — especially from their government! Just as the villagers in Werewolf must decide who to trust based on incomplete information, U.S. voters must navigate a complex landscape of political messaging, fake news, and emotional appeals to substantiate their opinions. The Informed Minority In Werewolf, the werewolves are the informed minority. They know who they are and use that knowledge to deceive the villagers. Their goal is to sow confusion and distrust among the villagers, steering suspicion away from themselves. Often, the werewolves will accuse innocent players or try to exploit any existing divisions among the villagers to weaken the majority. Similarly, in politics, the informed minority consists of politicians, lobbyists, and other insiders who have access to far more information than the general public. They understand the nuances of policies, the intricacies of the political process, and how public opinion is molded. Often, this informed minority will use their knowledge to manipulate the uninformed majority, whether through targeted advertising, misleading statistics, or emotionally charged rhetoric. This has become increasingly evident in U.S. politics, particularly with the rise of highly sophisticated political campaigns that use data analytics and behavioral science to pinpoint specific groups of voters. Political operatives craft messages that play on voters’ fears, biases, and insecurities, much like how the werewolves in the game try to manipulate the villagers' paranoia. One striking example of this was the 2016 U.S. presidential election, where micro-targeted ads on platforms like Facebook were used to sway key swing voters. The informed minority, in this case, consisted of political consultants, data scientists, and social media companies who understood the power of these tactics, while the majority of voters were unaware of the extent to which they were being influenced. Luckily, the Hildebeast failed to win that time. The Erosion of Trust A key aspect of Werewolf is the gradual erosion of trust within the group. As more players are eliminated, the remaining villagers become increasingly suspicious of one another. Werewolf is a game of paranoia, where no one is entirely sure who is telling the truth. This mirrors the decline of trust in American politics, particularly in the era of hyper-partisanship. According to the [Pew Research Center]( trust in the U.S. government is near historic lows. This mistrust is not only directed at politicians and institutions but also at fellow citizens. Political polarization has led to deep divisions in American society, with people increasingly viewing those with opposing political views as enemies rather than fellow citizens with different opinions. This is the essence of what happens in a game of Werewolf when players begin to turn on one another, unable to discern truth from deception. The Role of Media: A Double-Edged Sword In Werewolf, players rely heavily on communication and persuasion to navigate the game. Some players may dominate the discussion, while others can’t get a word in edgewise. The same is true in U.S. politics, where media plays a critical role in shaping the narrative. The media serves as a primary source of information for the public, but it’s also a tool for Deep State manipulation. Just as werewolves in the game may spread misinformation to throw the villagers off their trail, Deep State and its media minions use media outlets to promote narratives that serve their interests. This is particularly evident in the rise of partisan media, where different news outlets use the exact words to report stories, further fueling division among the electorate. At the same time, the media should act as a guardian, exposing corruption, uncovering hidden truths, and holding the informed minority accountable. (But those days are long past.) In this way, the media in U.S. politics plays a dual role, much like certain players in Werewolf who have special abilities, such as the Seer, who can secretly uncover the identity of the werewolves. However, as in the game, the alternative media's efforts to reveal the truth are undermined by those who seek to discredit them, labeling unfavorable reports as "fake news" or biased. Lessons for U.S. Politics Werewolf is a game of survival, strategy, and social dynamics. Its lessons extend far beyond the game table and provide valuable insights into the nature of politics, particularly in the United States today. Misinformation leads to disastrous outcomes both in Werewolf and in politics. The ability of the informed minority to shape the narrative and manipulate the uninformed majority is a powerful tool. Voters must critically evaluate the information they receive, question sources, and seek out multiple perspectives. In Werewolf, trust is the key to success for the villagers. Similarly, in politics, trust in institutions, leaders, and fellow citizens is vital for a functioning republic. The erosion of trust leads to division, making it easier for manipulative actors to gain power. The uninformed majority in Werewolf only wins by coming together and working as a cohesive unit. Divisions and infighting only serve to weaken them, allowing the werewolves to win. In U.S. politics, overcoming polarization and finding common ground is crucial for addressing the nation’s challenges. Just as the Seer in Werewolf must use its powers wisely to uncover the truth, voters must remain vigilant, stay informed, and hold political actors accountable. Blind trust or indifference leads to the rise of harmful forces within the political system. Wrap Up At its core, Werewolf is a game about power dynamics, trust, and deception. These same dynamics play out in U.S. politics, where an informed minority holds the upper hand over an uninformed majority. However, by recognizing the strategies of manipulation, fostering trust, and promoting unity, the majority can reclaim control and ensure that government works for the benefit of all. Understanding Werewolf's lessons may not solve all the problems in U.S. politics, but it provides a useful framework for thinking about how power is wielded and how the public must resist manipulation in an increasingly complex political landscape. All the best, [Sean Ring] Sean Ring Contributing Editor, The Morning Reckoning feedback@dailyreckoning.com X (formerly Twitter): [@seaniechaos]( [[Claim Your $1 Copy Today] Jim Rickards Endorses New Book From Top Hedge Fund Titan!]( [Click here to learn more]( [>> Click Here Now To Claim Your Special $1 Book Offer <<]( [LEARN MORE]( In Case You Missed It… “All I see is Red” Greg Guenthner, Editor [Greg Guenthner] GREG GUENTHNER Good Morning Reader, September strikes again! After just a handful of trading days, I’m here to report that this month is going much like many investors feared… Stocks are skidding lower at an alarming rate so far this month and traders are running for cover, buying up safety trades like utilities and consumer staples names as tech stocks and other popular plays continue to dive. The post-Labor Day malaise has been absolutely brutal so far — especially since it’s coming on the heels of the record-breaking August snapback. The S&P 500 went from sneaking up on new highs to dropping more than 4% in just four trading days during the holiday-shortened week. Brutal. First and foremost, it’s important to remember seasonality is working against the bulls right now. September is a historically volatile month. And it’s clear investors are a bit rattled right now (The early August Yen panic isn’t helping, either). But the world isn’t ending just yet. Yes, it’s true — stocks have gotten off on the wrong foot. My screen was red almost everywhere I looked last week, and we witnessed a tentative, back-and-forth bounce to begin the new trading week. I think there are a couple of key reasons why investors are dumping stocks right now. First, the most popular (and visible) stocks on the market have been underperforming for weeks. Yes, I’m talking about semiconductors. NVDA has sucked all the air out of the room since breaking out in early January. Not a second of market coverage could pass on the financial news without discussing this world-beating stock’s performance. But NVDA hasn’t posted a new high since June. Shares have also dropped as much as 20% since the company announced strong earnings late last month. Naturally, the other chip stocks have mostly failed to gain traction while NVDA struggled. In fact, many other high-profile semi-stocks topped out well before NVDA’s slump began. The VanEck Semiconductor ETF (SMH) is down 15% from its August highs — and 23% removed from those all-time highs set back in July. It’s difficult to convince the herd that everything’s gonna be alright when the one stock that has dominated the tape for the better part of the past eight months needs to take a break and maybe even *gasp* find some support levels and chop along for a bit to digest its recent gains. Still, it’s tough to imagine the market holding up when its most popular name has hit the skids. All the more reason for folks to flip bearish… Next up: I believe a bit more uncertainty has crept back into the picture. Obviously, the future is never certain — especially not when it comes to markets. But investors love to pretend that they know what will happen next. This little act is getting more difficult to pull off right now because we’re collectively focusing our concerns away from inflation and back toward whether this whole soft landing ordeal is going to work out. Here’s a telling passage from a recent WSJ piece on the recent market jitters: “Six months ago we had a zero risk of recession,” says Johanna Kyrklund, chief investment officer at Schroders. Now there is a risk, she says, that weakness among lower-income households starts to affect the rest of the economy. The market’s nervous ticks are now dictated by every little piece of economic data hitting the wire. Unfortunately, we’re running the gauntlet again this week: CPI hits the wire Wednesday morning, followed by PPI on Wednesday. Again, maybe inflation isn’t the big worry here. Instead, investors want to know if the economy is holding up… and not sputtering toward recession. Then, we have the main event! The Fed’s first rate cut is coming in less than two weeks. Barring some surprise numbers, it’s looking like we’ll probably see a 25-bps cut next Wednesday. But until we hear it straight from Powell’s mouth, the noise is going to get louder… Did the Bears Jump the Gun? Sentiment is also changing incredibly fast. Everyone was bulled up at the end of August following the miraculous recovery from the Yen panic lows. The mood quickly soured last week and investors are now expecting the worst. The truth, as always, is probably somewhere in between. For now, it would be prudent to remain cautious and give the market room to work out some of this angst. Anything can happen — but I would not expect an all-out meltdown at this time. The market’s in flux. Investors are rapidly adjusting their expectations. And many former market leaders are slipping. Yet there’s still positive action under the surface. Check out the stats from our friend Enrique as he breaks down September’s historically bad start: While we have witnessed an ugly drop during the first week of the month, there’s plenty of bullish data to fall back on. For starters, the market was looking constructive heading into the month. Market breadth was expanding (a fact we noted numerous times during the August snapback). As Enrique explains, expanding breadth is a reliable sign that the market will be higher following these bouts of turbulence. That’s great news for longer-term-minded investors. We don’t need to jump the gun and try to pick a bottom here just yet. Keep it simple! Let the market have its little tantrum, then wait to see if we get a failed move lower heading into October (perhaps a washout following the expected Sept. 18 rate cut?). If the expanding bull market over the summer was correct, we should see a meaningful bounce during the fourth quarter. Keep the bear suit in the closet for now… Best, [Greg Guenthner] Greg Guenthner Contributing Editor, Morning Reckoning feedback@dailyreckoning.com Thank you for reading The Morning Reckoning! We greatly value your questions and comments. Please send all feedback to [feedback@dailyreckoning.com.](mailto:dr@dailyreckoning.com) [Sean Ring] [Sean Ring, CAIA, FRM and CMT]( is a former banker and financial educator and is the editor of the Rude Awakening. Sean has trained interns and graduates from Goldman Sachs, Morgan Stanley, Citi, Bank of America, Standard Chartered Bank, DBS (Singapore), the Abu Dhabi Investment Authority (ADIA), Bank Indonesia (the central bank), HSBC, Barclays, RBS, and BlackRock. He knows the global economy is being corrupted by forces that most people can't understand and has used his unique and worldly experiences to help people navigate the markets. [Paradigm]( ☰ ⊗ [UPDATE PREFERENCES]( [Contact Us]( © 2024 Paradigm Press, LLC. 1001 Cathedral Street, Baltimore, MD 21201. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your The Daily Reckoning e-mail subscription and associated external offers sent from The Daily Reckoning, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@dailyreckoning.com. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. 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