The factory default settings of the human brain were essential in the past to secure our survival.
In modern times, however, that inner con man plays tricks on us that can end quite costly.
Would you have a few minutes for some slightly deeper thoughts? Do you trust your memory? Your memories are unreliable and often flat-out wrong, especially when it comes to remembering how you felt at a certain time or place.…
To what? – you might ask. To whatever you are somewhat interested in. We are masters in paying zero attention to what we are not interested in. All thanks to our inborn or learned biases. Regular readers of Tacomob are…
You and I we tend to be optimistic about the future. That is not a bad thing in general. However, this optimism might easily develop into “wishful thinking”. Too much “wishful thinking” will be harmful to you and your money. You might be awful…
Why do we consciously do things which we genuinely know are not beneficial to us? A non-financial example includes smoking cigarettes (we know we shouldn’t, but many do anyway), while a financial example includes not living within our means, or saving up for a…
If your answer is yes, you are an honest chap. If your answer is no, either you are lying to yourself or your name must be Nobody (“Nobody is perfect”). Or you are a candidate running for president—the best any country ever had. I would…
An interesting week we are going through right now. The stock markets are finally providing a bit more entertainment value. Giving us a good test on another (nasty) bias that makes us do dumb things with our money: Illusion of skills. All…
I had lunch with an ex-colleague from my corporate-duty-days yesterday. She asked me how was it possible (sic!) to achieve financial freedom by the age of 44? Hmm, that made me think. I was not able to come up with…
Are you a stock picker? May I ask why? What makes you think that you can outsmart full-day traders and the professionals? What is your edge over them? You might no longer have an edge in calculating ratios or analysing…
Don’t waste your time reading all those stock market forecasts! Unless it is for pure entertainment. At the beginning of each year, there are many pundits, experts, self-proclaimed gurus, and other suspicious characters who’d like to sell you stuff predicting…
… in other people’s minds. The timescale bias is quite a profound thing with serious implications. Ever noticed that anyone going slower than you is an idiot, but anyone going faster than you is a maniac?—George Carlin That is timescale…