A Few Reasons Why Nonsensical Investment Income Ideas Spread Faster Than a Few Good Rule-based Ones
A Planet Networthy story — behavioral finance edition
Part 1 — Information Asymmetry
Brandolini's Law (Income Edition)
\text{Debunking Effort} = 10 \times \text{Nonsense Output}
It takes seconds to sell a yield story.
Coined by Alberto Brandolini, January 2013 — inspired by Kahneman's Thinking, Fast and Slow. 'An order of magnitude' difference in effort.

"This pays 10% with no risk." — Talk is not just Cheap. It can also be Extremely Expensive to Clean up.
It takes hours to unwind the damage.
  • It takes seconds to sell a yield story
  • It takes years to unwind the damage
Part 2 — Emotional Asymmetry
Loss Aversion (Prospect Theory)
\text{Pain of Loss} \approx 2 \times \text{Joy of Gain}
Losing income hurts twice as much as earning it feels good.
Kahneman & Tversky, Econometrica, 1979. Losing $1,000 requires ~$2,000 gain to feel equivalent. Nobel Prize in Economics, 2002.
  • Losing income hurts twice as much as earning it feels good
  • Being wrong feels like a financial loss

"Admitting the "income" was fake hurts more than Finding the Truth feels Good."
The Collision
\text{Bad Income Ideas Thrive} = (\text{Cheap to Say}) \times (\text{Painful to Let Go})
Retail investors cling to stories
Professionals cling to credentials
Cash flow doesn't care about either
Income investing isn't about intelligence. It's about resisting stories when cash flow is boring.
Sources: Kahneman & Tversky (1979), Econometrica 47(2); Brandolini, A. (2013); Frankfurt, H. (1986), On Bullshit, Princeton.
Why Bad Yield Stories Win Every Time
Most income investors think they're rational. Until the yield story honeymoon is OVER.
Here's the uncomfortable math:
10×
More effort to debunk a bad income idea than to sell it
2×
More pain from losing income than joy from earning it
Retail investors fall for Narratives. Professionals fall for Credentials. Cash flow falls for Neither. Nonsense eventually Walks.
Admitting the yield was part your own Capital can be Tough to Swallow.
If the income isn't real, repeatable, and verifiable — it's not yield. It's marketing.
You are at the crossroads. The Choice is Clear. Join Club Dividend
Detective. Map the Road from Where you are to Where you
Want to Go. Play to Win by Refusing to Lose.
📉 Stories compound faster than cash flow.
📈 Discipline compounds longer.
Sources: Kahneman & Tversky (1979), Econometrica 47(2); Brandolini, A. (2013).
Know Your Cash Flow.
Knowledge only pays dividends if you express interest.
Get aboard the Pensionizer Express — train of thought.
Station Reunion is the meeting place.
See you in Club Dividend Detective on Planet Net Worthy.