I want it now (impulsiveness, immediate gratification)
Two important qualities for an investor are patience and discipline. All the great investors whom I have studied seem to have these traits, yet it appears that many people lack these attributes in their character. They are impulsive, which is bound up with the desire for immediate gratification. Of course, it must be recognised that this desire for instant gratification is fed by the advertising industry, which promises us we can have whatever we desire right now and pay for it later, often interest-free!
The bias or tendency to immediate gratification in many people is driven by quite natural impulses. On the one hand we seek pleasure, which encourages grabbing things for instant gratification. On the other hand, we avoid pain, which encourages delayed payment, albeit at a cost that can be difficult to pin down at the time.
Scientists studying impulsiveness disorder conducted an experiment with rats in which they had to trigger devices that fed them. They had a choice between a device that consistently delivered a small food reward and another device that delivered a food reward that was significantly larger, but only after a delay. It was found that the rats consistently chose the instant reward over the delayed reward, no matter how much larger the delayed reward was. This supported the observation that humans ...