Posts filed under “Psychology”

On False Belief Systems . . .

I stumbled on this gem earlier today:

“Earlier this year, the Dow had dropped over 5,000 points in 6 months. One of the collective fallacies our culture operates under is the delusion that the market is some kind of astute forecasting machine. It is not — it represents the collective wisdom of 10 million panicked monkeys. That millions of slightly clever, pants wearing primates can combine their collective ignorance, their intellectual foibles, biases and false beliefs somehow into something resembling intelligence was one of the false beliefs of the era. Unfortunately, this is a condition the monkeys are prone towards (Witch burning, bloodletting, organized religion, etc.).”

-How Overrated is Sentiment in Economics?, November 22nd, 2009

The entire discussion is worthwhile . . .

Category: Philosophy, Psychology

Rory Sutherland: Sweat the small stuff

It may seem that big problems require big solutions, but ad man Rory Sutherland says many flashy, expensive fixes are just obscuring better, simpler answers. To illustrate, he uses behavioral economics and hilarious examples.

Category: Psychology, Video

What I Learned After 30,000 Blog Posts . . .

>   My Sunday Washington Post Business Section column is out. On the anniversary on my 30,000th blog post, I looked back at what I learned. That is a lot of posts over the past dozen years — The Big Picture blog was begun back in 2003. Here’s an excerpt from the column: “After more…Read More

Category: Apprenticed Investor, Psychology, Weblogs

RIP Paul Macrae Montgomery, originator of Magazine Cover Indicator

  Paul Macrae Montgomery, best known as the originator of the Time Magazine Cover Indicator, and for popularizing the Hemline Indicator of the stock market, died this weekend. He was 72. I was fortunate to have had several conversations with Mongomery over the years. He was humble and soft spoken but he took delight in…Read More

Category: Analysts, Markets, Psychology

Is Modern Life Making Us Dumber?

Forget “Peak Oil” and “Peak Credit” … Are We On the Downslope of “Peak Intelligence”?   Scientists say that we have much smaller brains than our ancestors had 20,000 years ago … and we might have gotten stupider since agriculture became widespread. Huffington Post reports that we’ve probably gotten dumber than even our Victorian ancestors:…Read More

Category: Psychology, Think Tank, Web/Tech

Behavioral Economics and Macroeconomic Models

Category: Psychology, Think Tank

Ponzi Scheme Tracker

Cool data collection

Category: Investing, Legal, Psychology, Really, really bad calls

Skepticism Leads to More Market Momentum

Amid a wealth of potential problems, markets are now close to record highs. Military conflicts in Syria, Iraq, Gaza and Ukraine are an unending source of concern. Domestically, economic growth remains below potential. The civil strife in Ferguson, Missouri, reveals the U.S. to be a nation even more divided than previously thought by many. At…Read More

Category: Contrary Indicators, Markets, Psychology

Why should investors care about geopolitics?

One of the concerns for investors is how markets keep powering higher despite all of the geopolitical turmoil: The grinding Syrian civil war that has spilled into Iraq, the clash between Israel and Gaza, the Crimea annexation and now the confrontation between Russia and Ukraine. That thinking gets the issue precisely backward. The proper question…Read More

Category: Investing, Markets, Psychology, War/Defense

Smarter and Less Smart As We Age

Academic Eric Johnson explains the impact of intelligence on finances at an Atlanta Fed Public Affairs Forum

 

 

Via Federal Reserve Bank of Atlanta

 

Category: Cognitive Foibles, Psychology, Video