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Fred Stein's avatar

Agree with Larry, and thanks for the note about the book. Adding:

In addition to our own biases of "confirmation", "recency", "identity", etc., public markets express collective biases. The excess swings up or down illustrate this. And currently we have naive followers making bets based on a tweet or a text message from a friend. These gamblers will push stocks higher late in the cycle and likewise push assets down late in the cycle.

Another book on Doug's theme, "The 5 Mistakes Every Investor Makes," by Peter Mallouk.

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Larry's avatar

Doug - I think this is your best posting yet. "Proving yourself wrong is the ultimate contrarian bet" - in a world where changing your mind is seen as weak, acknowledging there are multiple potential outcomes is confused and the phrase "I don't know" has been deleted from from discourse - you hit the nail on the head - if you have never read the book Sway, The irresistible Pull of Irrational Behavior by the Brafman brothers - which hilariously explores how unconscious bias impacts decision making - I will send to your office. Maybe I should start a substack called "The Unconscious Profit" :)

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