Why We’re Paying Attention to the Wrong Things, with Dr. Daniel Crosby

#413: If an idea dominates the headlines, we notice it. But maybe we shouldn’t. Today’s guest, psychologist and behavioral finance expert Dr. Daniel Crosby, says there’s a difference between a prediction that gets repeated, and one that’s likely to unfold. What’s salient isn’t accurate, he says. And vice versa. He also talks about how money problems have morphed over time. He chats about how our evolutionary wiring is at odds with our goals. And he even discusses how we’re wired to be ‘lazy’ – and how to work with that tendency instead of fighting an uphill battle against it. Dr. Crosby researches the intersection of mind and markets. His latest work, The Behavioral Investor, is an in-depth look at how sociology, psychology and neurology impact our investment choices.

Timing of discussion points as of December 2022: 03:10: The overlap between psychology and investing + new ideas 04:41: Counterintuitive behavioral finance discoveries 07:27: Money as a “hygiene factor” 08:39: The “new class” of money problems for the more affluent 13:44: Factors that impact our financial decisions 15:22: The influence of evolutionary wiring 17:02: Cognitive and physical wiring leading to laziness and group think 27:45: The benefit of community for investors 28:52: The four types of behavioral risk: ego, conservatism, attention, and emotion 36:21: The three E’s of behavior change: education, environment, encouragement 42:30: Confusing things that are loud with things that are likely 45:21: The risk of managing emotion

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