THREAD: Signs you might be in a cult - and is that a bad thing? Cults by and large are naturally occurring phenomena. Like it or not we are all probably in some kind of cult. But to ensure you are not taken advantage of it’s important to know your cult.

Many years ago I was thinking of writing a book called Cult Markets. The basic premise was that the rise of things like bitcoin, Tesla and unicorns - investing was turning ever more into a cult-like belief structure. I was curious to investigate the cult aspects of many assets.

I had some insight into the cult phenomenon because I had always enjoyed studying ancient history. From the mystery cults of Rome to early Christianity, cults had clearly played a major role in the story of human progression but also investment.

But what really is a cult? What does it mean to be described as a cult product or a cult trend?

Are there good and bad cults? And if so what differentiates them?

An example of a good cult I would argue is something like the belief in Santa Claus. We all know Santa Claus is not real. We all know it’s silly. But it makes us happy to suspend belief for the sake of giving our children something positive and magical to believe it.

But even with Santa Claus we have to recognize there’s an important social control side to the story. We as parents use Santa to control our children. That’s not necessarily ominous. We lie to them because we love them and need incentives to keep them on track.

Bitcoin is also a type of a cult. Unlike Santa Claus though it’s not presented to us from a paternalistic perspective. People who buy crypto I have found tend to be fully aware of its Ponzi scheme nature. And that really is its most innovative hack.

Because bitcoin is structured like a cult (even comes with a mythical but anonymous founder) it draws a sense of stability from its believers. The more they believe (or HODL) the more stable it gets. And since they are cognizant of their role in the cult ...

... it’s actually somewhat hard to argue against their right to contribute or donate to the cause they believe in. They are doing it of their own free will and that’s important. As long as the disclosures are there and ppl join freely and understand the risks, it is I think fair.

The problem is .. the more normalised a cult becomes in society the easier it gets to distract would-be recruits from the fact that they are actually joining a cult. This is bad. As it means they can be manipulated. So an honest cult takes care that new recruits are made aware.

In stocks, these problems come about when unscrupulous stock promoters oversell products without flagging the due risks. Or over sell the cult leader/founder as being something he isn’t. That’s why authenticity matters.

Which brings me to the Personality Cult. From Elon Musk in business, Lady Gaga in pop culture to the cults of Stalin, Xi and Trump in politics, personality cults are everywhere. Are personality cults ever ok?

My graduating thesis from my ancient history BA at UCL was on "the significance of the cult of Apollo to the reign of Augustus". This was decades ago, but I think the learnings are still very relevant.

The interesting thing about Augustus (formerly known as Octavian), is that he knew that to stabilise Rome from years of civil war and unrest, he needed to give the Romans something to believe in. His cult of Apollo was a bit like a benign cult.

To understand the rationale for the Augustan Cult of Apollo, you have to understand the disinformation wars/chaos that came before them. I wrote about them here in 2016: https://www.ft.com/content/aaf2bb08-dca2-11e6-86ac-f253db7791c6

Apollo was a means to an end. Augustus did not set out for people to worship him directly, but rather to associate his reign with the god Apollo for whom cult practice was already fairly established. All sorts of things thus became dedicated to his favourite god.

But slowly over time the deification of the emperor became a thing. It's not that Romans were suddenly brainwashed into thinking he was god, but rather that eventually he would join the gods. Since heroes could.

So a cult that was developed mostly to help give the plebs something to believe in, in a way that could help stabilise Roman society after decades of discord, inadvertently became the foundation of an Imperial Cult that would later be massively abused by future emperors.

Roman cults went wrong, essentially, because after many generations people lost sight of the practical foundations of obviously fake cults. Augustus gave people something morale boosting to believe in: a make Rome great again message. He started a reconstruction effort.