psychology

It's time to get positive. A good friend of mine from Toronto was telling me today how depressing the drip-drip of bad news regarding the economy, the markets and housing is becoming. The housing bust has been going on for nearly two…

Last week, I showed two charts on returns on the Dow Jones Industrial Average that had two seemingly contradictory messages. In the first chart measuring 10-year returns, one could clearly see that long-term returns have been declining…

'Buy and hold' is a myth that I hope dies an ugly death just like the Efficient Market Hypothesis. When one looks at the numbers, it is as plain as day that the stock market moves in sweeping trends that take decades to unfold.

What has the housing bubble told us about market efficiency, social psychology and economics? Quite a lot, I believe.In the aftermath of the housing bubble, one thing is for certain: we can throw out the inane "Efficient Market…

Judgment or Experience?Many American citizens claim our President needs a strategy and a vision for the future. The most common complaints are about a lack of vision on the economy, health care and in our response to terrorism and the war…

Voters in America are concrete, specific, and focused on the here and now by a margin of 3 to 1. To me, this has a real impact on the outcome of primary and Presidential races as candidates must speak in a way that resonates with those…

In psychology, cognitive dissonance is an uncomfortable feeling or stress caused by holding two contradictory ideas simultaneously. The theory of cognitive dissonance proposes that people have a fundamental cognitive drive to reduce this…

About five years ago, Daniel Kahnemann won the Nobel Prize in Economics for his work on Behavioral Economics. This was a breakthrough because the financial markets and the economics profession had been dominated by the "efficient market,"…

As the financial sector melts down, one wonders which institutions are the safest: smaller local banks, money center banks, super regionals, credit unions. Credit unions are certainly something to think about because they offer high rates…