Also known as the “I knew it all along” effect. Hindsight bias refers to our tendency to take facts now known and interpret them in a way that explains past events. In retrospect everything seems clear and inevitable. This is a…
A close relative to the previously mentioned Confirmation Bias, Overconfidence is the tendency to overestimate our own abilities (i.e., we aren’t as smart as we think we are). We tend to think that we are much better forecasters and estimators than we…
Believing that something is true only because other people think it is. Whether politicians or stocks, people like being associated with things that are winning, so winners build momentum, not because they deserve it, but because they’re winning. This is…