Jan 12

There are times when uncertainty is unbearable: waiting to hear about a school or job acceptance or pacing outside the operating theatre of a loved one. But other times we’re a lot happier being in the dark – or at least partially shaded.

Many of us have spent time beside a pool. And you have probably wondered: what are the odds that no kids have peed in the pool (or adults, for that matter). When pressed, we’d have to admit that the odds that the pool is peefree are close to zero, but the lack of absolute certainty allows us to relax and swim anyway. We may comfort ourselves with some fuzzy thought about chlorine or the immense volume of the pool relative to a few bladders, and our concerns slip away.

Now, compare this with watching a kid stand by the pool and pee into it. Throw in some swimming trunks around his knees and a frantic, embarrassed parent scooping him up, alas, too late. Now you’re no longer able to hold onto the slight possibility that the pool is free of urine. The relative volume of the water in the pool is now little comfort when you just saw a kid pee in it. So, how happy are to take a quick dip?

When things are very close to being certain but we are still able to pretend otherwise, we are experts at using this window, small though it may be, and expanding it. For example, lots of people don’t wash their hands after visiting the lavatory, we all know this, but we can happily imagine that everyone that cooks and serves in a restaurant we patronize does. At least until we see a server leave the stall, straighten their shirt in the mirror, and walk out without so much as a rinse. Dinner is served ruined! It’s only when we face direct evidence like this that we can no longer put our heads in the sand.

This also happens on a broader scale when we hold something or someone in high esteem and then something undesirable happens. Consider the five second rule for food: it’s just enough time that we can pretend that nothing has sullied our snack. Or think about people who “go vegetarian” after reading books like Eating Animals, as opposed to their friends who choose not to read it (sort of like poolgoers who look the other way in order not to see the kid in action). We could also consider all the people on both sides of the political spectrum who don’t listen (with any degree of earnestness) to the opinions and facts presented by the other side.  Ignorance may be bliss, but often it’s just a speck of reality that ruins our ignorance.

JP Morgan Chase’s loss of several billion dollars in 2012 was a similar situation. It’s difficult to imagine that over the last five years we were able to view any company as relatively pure, which is how many viewed JP Morgan Chase. It seemed likely that they, like other banking companies, probably had some skeletons in their closet, but we didn’t know for sure, and so they continued on with their relatively good reputation. In the race to the bottom of the banks, JP Morgan Chase’s CEO Jamie Dimon got the best title a banker these days can get: “the least-hated banker in America”. Now we have about three billion dollars to prove the contrary.

While it’s true that for a company that size, three billion a relatively small amount to lose (and surely their accountants could have hidden it), the problem is that now we have direct evidence that they’re not perfect. Once again we were forced to see reality, and we can no longer avoid the knowledge that the pool is polluted – even if the damage was done by the least-hated character. And I suspect that for many the events at JP Morgan Chase further polluted not only their opinion about that company, but also about banking generally.

Recently published in Wired UK.