Sunday, October 23, 2011

(not a post related to Malcolm Gladwell)

On a note related to the previous post (my linking to which, it must be admitted, more than anything tends to reinforce the point of Daniel Kahneman's article), I encourage you to read "Don’t Blink! The Hazards of Confidence." Here's an excerpt:

The confidence we experience as we make a judgment is not a reasoned evaluation of the probability that it is right. Confidence is a feeling, one determined mostly by the coherence of the story and by the ease with which it comes to mind, even when the evidence for the story is sparse and unreliable. The bias toward coherence favors overconfidence. An individual who expresses high confidence probably has a good story, which may or may not be true.

The part near the end about those involved in the stock market is particularly instructive. Some funny illustrations, from Tim Enthoven, too.

Giant flying rhinoceros bearing down on a photographer

[Added] Uncle Eb also liked the article, and added some artwork that I just had to swipe.

Cat approaching eagle on a fence top.  Caption: 'OVERCONFIDENCE: This is going to end in disaster and you have no one to blame but yourself.'

Though, of course, we shouldn't be too harsh on eagles for their poor judgment. That could be construed as America-hating, after all.

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