A Gallery of Crowd Behavior
Investors BELIEVE that bank stocks are not the place to be.
Investors are not confident that brokerage firms are the place to be.
Investors are POSITIVE that the Hong Kong market is the place to be!
"Who doesn't get it? Gold is going up, and the dollar will continue to get decimated."
"Besides, I can't even remember a time when the dollar went up and gold went down?"
But doesn't all the reckless lending of the last few years ever show up somewhere?
At the end of the day, no matter what happens to the real economy, you can always count on innovation as a place to invest.
Or can you?
"And credit will ALWAYS expand."
Or, will it?
At the end of the day, we must remember that stories are one of the most powerful parts of communication, and therefore, our decision making processes. Until we understand our human tendency is to extrapolate the past, and embrace stories that support our feelings of a current trend, we will fail to search beyond our feelings and passionately seek for signs of the END of a current trend.
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