Part VIConclusion: Debiasing
38. How Not to Blink in the Face of Financial Panic
We know we make intuitive mistakes when making financial decisions. The real question is, “What to do about it?” This is a much less researched question than identifying the behavioral biases themselves, and it is not an easy one to answer. Very little is known and the challenges are immense: Our cognitive propensities and gut instincts are deeply entrenched from long, long ago. They may have evolved before language, or even before there were people. Animals also rely on rules of thumb to find food and avoid being eaten. But animals don’t issue credit ratings or securitize mortgages.
How, then, can we protect ourselves from ourselves? Government regulations are ...
Get Snap Judgment: When to Trust Your Instincts, When to Ignore Them, and How to Avoid Making Big Mistakes with Your Money now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.