Apropos, what we talked about in class the first week, comes this story about the millennials (this is you born between 1980-2000) not saving enough for retirement given market gyrations of the last few years. My informal survey in class suggested that at least the vocal among you were in favor of being invested in equities, but this story seems to suggest that these are not the norm. Read on.,
Conversation with a recent college graduate about career choices brought this poem back from the past.
A psychological tip. (Piet Hein).
Whenever you’re called on to make up your mind,
and you’re hampered by not having any,
the best way to solve the dilemma, you’ll find,
is simply by spinning a penny.
No — not so that chance shall decide the affair
while you’re passively standing there moping;
but the moment the penny is up in the air,
you suddenly know what you’re hoping.
How we make decisions depends entirely on how the issues are framed. Watch the clip here.
From the Psy-Finance Blog comes this story on Isaac Newton, scientific determinism and behavioral finance. A must read.
Many of you ask me why I don’t write more stuff or even get on twitter. One answer is that I am simply to busy reading all the clever things that other people have to say. Another of course, could be that I don’t have that many originally clever things to say myself !!!!
This graph of analyst earnings estimates illustrate the optimism bias that affects people.
Notice how frequently estimates turn down over the year and how they compare with the blue dots (actuals). The whole post here.