“There are differing opinions about whether overconfidence is good for humanity. Some say that believing that you’re better than you really are is a self-fulfilling prophecy that’s good for ambition and swift decision making. Overconfidence can lead to boosts in social status, and overconfident populations have been shown to be more evolutionarily stable. Others argue that overconfidence leads to hubris, self-deception, and blind spots in decision making.
In behavioral finance, overconfidence for traders can lead to risky stock picks and overtrading. (Malcolm Gladwell wrote about overconfidence as one of the psychological flaws of Wall Street leading to the crash.) But what about personal finance? Do individuals take on the same attitudes as stock traders when dealing with their own money, where losses can hurt their own bank accounts?” *
Cenk Uygur (http://www.twitter.com/cenkuygur) and Ana Kasparian (http://www.twitter.com/AnaKasparian) discuss.
*Read more here from http://www.theatlantic.com/business/archive/2015/01/twentysomethings-barely-saving-but-surprisingly-confident/384187/
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