11 Jun Semmelweis Reflex and the CNAV Strategy
Ignaz Semmelweis was born in 1818 in Budapest, Hungary. He went on to study medicine in the University of Vienna, before specializing in obstetrics and obtaining an appointment in the Vienna General Hospital.
His duties then included preparing patients and supervising difficult deliveries. He also played the role of a mentor, teaching students new to the field.
The Vienna General Hospital had two clinics conducting deliveries. Dr. Semmelweis was in charge of First Obsterical Clinic. In 1846, there is a significant difference between the infant mortality rates of First and Second Clinics.
The rate at Dr Semmelweis’ clinic was at 10 percent while that in the adjacent one was barely 4 percent. What this means was that for every ten babies delivered in his clinic, one would not survive. Pregnant women admitted to the Second clinic stood a much better chance of their babies surviving the childbirth.
The situation became so bad that women were begging not to be admitted to the First clinic. To make matters worse, it was discovered that babies delivered in the streets survived better than babies delivered in the First Clinic.
What could be killing the babies?
Dr Semmelweis was perplexed. Something was killing these babies and he would have none of it. He set out to find the cause.
For a start, the clinics admitted patients on alternate days. Hence admission was totally random and that could be ruled out as a possible cause. He examined the techniques they used and discovered no differences at all. He looked at overcrowding and climate but again came to another blank wall.
The only difference, Dr Semmelweis concluded, was the people working in the clinics itself. The Second Clinic was the designated clinic for the instructions of midwives only, while the First Clinic, the one he works in, was the teaching service for general medical students.
What this means is, doctors at the First Clinic were also scheduled to conduct autopsies. They were in close contact with corpses throughout the day. Now this was a time whereby people did not think of disease as a consequence of germs, and the concept of modern day sterile hospital environment has yet to be developed.
Autopsies and Germs
The good doctor hypothesised that germs remained on the hands after doctors conducted autopsies, and he instituted a hand washing regime between tasks for his staff. He made them disinfect their hands in a solution of chlorinated lime before conducting any delivery.
For the first time mortality rate decreased significantly in the First Clinic. Mortally rate dropped to less than two percent in the following months! Dr Semmelweis has cracked the mystery and rescued countless mothers and babies from death by infection.
Now you would have imagined with such an amazing discovery under his belt, Dr Semmelweis would have been designated for super stardom. He would have won awards, received praise from his peers and be the toast of his patients.
That is furthest from the truth. The medical community at that time consisted of distinguised gentlemen of standing in the society. They were horrified that anyone even dared to suggest that germs could be transmitted off their hands.
The thought of themselves as being germ transmitting death eaters simply did not sit well with Dr Semmelweis’ peers. They had him dismissed and his theory denounced. He was ostracized by the community, banished from Vienna and eventually in 1865, committed to an asylum where he eventually died.
The Semmelweis Reflex
Human behaviour and thinking is often entrenched. We stick to what we are familiar with and reject almost automatically what is new, especially if the new idea and belief makes us uncomfortable.
The Semmelweis Reflex, after Dr Ignaz Semmelweis, is coined to represent this facet of human behaviour.
And as we can tell from what transpired in Vienna more than a hundred years ago, rejecting something outright without properly considering its merits could be extremely foolish.
Value Investing Mastery Course and the CNAV Strategy
When we first started the VIMC at the beginning of this year, we were filled with apprehension.
For one, the groundings for the course is very different. We recognized early on that we cannot be Warren Buffett, and that realisation led us to approach Value Investing in a radically different way.
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We have put together a great course that would change the way retail investors invest. Yet we understand how difficult it is to break barriers and gain acceptance.
Along the way we had our fair share of detractors. Some questioned our methodology. Many were concerned about liquidity and volume. Yet others insisted that dividend plays are the way to go. We tried to explain, but were often dismissed. At times we wonder just how much a part the Semmelweis Reflex has a play in their thinking.
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Stop being the stuffy old gentlemen who insist that their hands carry no germs. Give us a chance to convince you otherwise!