Jurgen Klinsmann, the coach of the US soccer team is caught in a maelstrom after deciding to leave Landon Donovan, the leading goal scorer in US Men’s National Team history off the team. But I don’t think he’s getting enough credit for the brilliance behind the move. And to me, it looks like a smart case of second level thinking.
This recent Gallup survey on expected future returns of asset prices is pretty interesting. It shows that most Americans still think that owning a home is the best way to generate a high return in the future:
In my view, “risk management” is largely about understanding the big picture so you can better decipher the world.
I don’t know what it will take for more people to take behavioral finance seriously and assimilate it into their work, but I do think that day is coming. Here’s to hoping it doesn’t take another 2008 style slap upside our economic head to get us there.
We humans are a fickle bunch. If there’s one thing you can pretty much guarantee, it’s that things are never really good enough. We seem to focus excessively on the [ … ]
I was intrigued by comments in this interview with Marc Faber of the Gloom, Boom and Doom Report. He said: “I am hoping for the market to drop 40% so [ … ]
The biggest risk in 2014 is likely to be a common one – recency bias. Otherwise known as your own brain’s tendency to focus excessively on things that have only just occurred.
There were many big developments in 2013, but none stood out quite like the impact of behavioral finance. A few things made this the year of behavioral finance:
Good paper here via quantivity on Twitter discussing the effect of fund managers borrowing on margin to purchase assets. This is something I’ve discussed previously in my many posts on margin [ … ]