Stock markets around the world are crashing right now, but why?
The answer to this question is the Yen carry trade, a term you'll probably hear many times this week.
So what exactly is the Yen carry trade and why did it cause a market downturn?
A thread to explain:
(1/7)
A man installed a GPS tracker on his cat to track its route while he was walking his dog.
To his surprise, the cat stealthily followed him and the dog for the entire walk.
10 Biases that distort your Decision-Making:
1. Self-Serving Bias - Our failures are situational, but our successes are our responsibility.
2. Curse of knowledge - Once we know something, we assume everyone else knows it, too.
3. Dunning-Kruger Effect - The less you know, the more confident you are. The more you know, the less confident you are.
4. Belief Bias - We judge an argument's strength not by how strongly it supports the conclusion but by how plausible the conclusion is in our own minds.
5. Escalation of Commitment - We invest more in things that have cost us something rather than altering our investments, even if we face negative outcomes.
6. Gambler's Fallacy - We think future possibilities are affected by past events.
7. Zero-Risk Bias - We tend to reduce small risks to zero, even if we can reduce more risk with another option.
8. Outgroup Homogeneity Bias - We perceive out-group members as homogenous and our own in-groups as more diverse.
9. Clustering Illusion - We find patterns and clusters in random data.
10. Blind Spot Bias - We overlook biases in our own decision-making and see them more in others.
Which of these is troubling you the most?😅
The Curse of Knowledge is up there for me.