Nyxonx

Human behavior, psychology, money & status.
Stories and studies that explain why people do what they do.

[Nyxonx @nyx0nX]

https://t.co/MayGHybXLQ

[Nyxonx @nyx0nX]

Everything takes longer than you think” has a name. Kahneman called it the planning fallacy, and the strange part is that it survives experience — people who have been late on every project still forecast the next one as if they will not be.
The forecast is not a prediction. It is a description of the version of you making it.

[Nyxonx @nyx0nX]

Why does a small loss ruin a week while an equal gain lasts an afternoon?

Why does the plan you made on Sunday feel like it was written by someone else?

Why do you check the account when you already know looking at it changes nothing?

A Stanford professor spent 25 lectures answering questions like these, from the biology up. The whole course is on YouTube. Almost nobody who trades daily has opened it.

Bookmark this. I pull one lecture at a time out of it here, with the research behind each.
https://t.co/1PFQpz8iQJ

[Nyxonx @nyx0nX]

https://t.co/MayGHybXLQ

[Nyxonx @nyx0nX]

@garyvee The focus advice survives because the people who focused and won write books. The people who focused on the wrong thing for a decade do not.
Same advice, and you cannot tell which group you are in until afterwards

[Nyxonx @nyx0nX]

$71,000 a year to sit in that lecture hall. $0 to watch the same lecture.

A monkey gets a signal, presses a lever, receives juice. Measure its dopamine and the spike does not arrive with the juice. It arrives with the signal.

Now make the juice come only half the time. The dopamine response roughly doubles.

Not at ninety percent, where the outcome is nearly certain. Not at ten, where it is hopeless. At fifty, where the animal cannot know.

This is Robert Sapolsky at Stanford. Human Behavioral Biology, filmed in the lecture hall and put online for nothing. He spent over thirty years going back to the same troop of baboons in Kenya, following the same animals across their entire lives, measuring stress hormones in a population that has no mortgages and no quarterly targets and gets ulcers anyway.

Then the correction to what everyone assumes.

Dopamine is not the chemistry of pleasure. That was the story for decades, it is in a thousand articles, and it is wrong. Dopamine is the chemistry of anticipation — of the interval between the signal and the outcome.

Then the experiment that showed it.

Wolfram Schultz put electrodes in monkeys and watched when the neurons actually fired. Early in training, the spike came with the reward. Once the animal learned the signal, the spike moved backwards in time, onto the cue. The reward itself stopped producing anything. What the brain was tracking was not the juice. It was the difference between what it expected and what arrived.

Then the consequence.

The best part is not getting it. The best part is the stretch where getting it is still possible. This is not a figure of speech. It is a measurement, taken from an electrode in an animal that has no idea it is proving anything about you.

Then the part where it gets worse.

If the reward is certain, the system goes quiet. Guaranteed outcomes produce almost nothing. The response needs the gap. Which means a system that reliably delivers what it promises is, chemically speaking, boring — and one that delivers half the time is not.

Then the number that explains an industry.

Maximum response at fifty percent. Every slot machine, every loot box, every pull-to-refresh feed sits on that number, whether or not the people building them have read the paper. Nobody had to invent this. They found it by testing what people came back to.

Then the part about you.

Refreshing the chart is not about the position. It is about the interval. The account is the signal, the number is the juice, and you already know that looking at it does not change it. Knowing that changes nothing, which is the whole point — this runs underneath the part of you that reasons.

Watch how he handles the room when he reaches the fifty percent finding. He does not explain the implication. He waits, and they get there on their own.

Free on YouTube, from Stanford.

Bookmark this and watch later — after this lecture, every notification you open will feel less like a reward and more like the interval before one.

[Nyxonx @nyx0nX]

https://t.co/MayGHybXLQ

[Nyxonx @nyx0nX]

@garyvee The tell is what happens when new evidence arrives. Optimism moves. Delusion explains.

[Nyxonx @nyx0nX]

A behavioural economist offered gym members two contracts. One charged $10 a visit. One charged $70 a month, which was cheaper for anyone attending more than seven times.

Most chose the monthly plan. Then they attended about four times a month.

They paid roughly double, voluntarily, in advance, for a version of themselves that did not show up.

This is MIT course 14.13, filmed on campus, on OpenCourseWare for nothing. A year in that room costs $93,730.

Then the assumption being removed.

Standard economics assumes you discount the future at a constant rate. Whatever a year of waiting costs you, it costs the same whether that year starts today or in a decade.

Then the correction.

You do not. You are patient about every future version of yourself and impatient about the one sitting here right now. Ask someone to choose between $100 today and $110 next week and most take the $100. Move the same choice a year out — $100 in fifty-two weeks or $110 in fifty-three — and the same person waits.

Identical gap. Identical wait. Opposite answer.

Then the part that costs money.

Every plan you have ever built assumed a person who behaves better than you will. The savings plan, the deadline, the diet. You are not forecasting badly. You are forecasting someone else.

Then the split.

Some people know this about themselves and some do not, and that difference is worth more than any of the biases individually. The ones who know it stop relying on future willpower and start building things that do not need it. Automatic transfers. Contracts with penalties. Removing the choice instead of winning it.

Stay until the end. He puts up the gym numbers and lets the room sit with them. People who had every incentive to do the arithmetic, choosing the more expensive option, for years.

Free on MIT OpenCourseWare.

Bookmark this and watch later — after this lecture, every plan you make will come with a second question attached: does this need a future version of me to cooperate.
https://t.co/1PFQpz8iQJ

[Nyxonx @nyx0nX]

@garyvee Beginners often create better content because they’re still close enough to the struggle to explain what experts now take for granted

[Nyxonx @nyx0nX]

Worth adding a measured version of this. Kahneman and Tversky put it on an axis: value is not a function of what you have, it is a function of what you have minus your reference point.
Change the point you are counting from and the same outcome reads as a win or as a loss. Perspective has a coordinate.

[Nyxonx @nyx0nX]

A behavioural economist offered gym members two contracts. One charged $10 a visit. One charged $70 a month, which was cheaper for anyone attending more than seven times.

Most chose the monthly plan. Then they attended about four times a month.

They paid roughly double, voluntarily, in advance, for a version of themselves that did not show up.

This is MIT course 14.13, filmed on campus, on OpenCourseWare for nothing. A year in that room costs $93,730.

Then the assumption being removed.

Standard economics assumes you discount the future at a constant rate. Whatever a year of waiting costs you, it costs the same whether that year starts today or in a decade.

Then the correction.

You do not. You are patient about every future version of yourself and impatient about the one sitting here right now. Ask someone to choose between $100 today and $110 next week and most take the $100. Move the same choice a year out — $100 in fifty-two weeks or $110 in fifty-three — and the same person waits.

Identical gap. Identical wait. Opposite answer.

Then the part that costs money.

Every plan you have ever built assumed a person who behaves better than you will. The savings plan, the deadline, the diet. You are not forecasting badly. You are forecasting someone else.

Then the split.

Some people know this about themselves and some do not, and that difference is worth more than any of the biases individually. The ones who know it stop relying on future willpower and start building things that do not need it. Automatic transfers. Contracts with penalties. Removing the choice instead of winning it.

Stay until the end. He puts up the gym numbers and lets the room sit with them. People who had every incentive to do the arithmetic, choosing the more expensive option, for years.

Free on MIT OpenCourseWare.

Bookmark this and watch later — after this lecture, every plan you make will come with a second question attached: does this need a future version of me to cooperate.
https://t.co/1PFQpz8iQJ

[Nyxonx @nyx0nX]

https://t.co/MayGHybXLQ

[Nyxonx @nyx0nX]

There is survey data on exactly this. Graham, Harvey and Rajgopal asked over 400 CFOs about it. A majority said they would pass on a project with positive net present value if taking it meant missing the quarterly earnings number.

Not a mindset problem. A stated, deliberate trade — and they knew what they were giving up.

[Nyxonx @nyx0nX]

@garyvee There is a measured version of this. Dan Gilbert at Harvard calls it impact bias: people systematically overestimate how long a bad event will affect them.

Not that it will not hurt. That the forecast of how long it will hurt is the part that is reliably wrong.

[Nyxonx @nyx0nX]

In 2000 he published a book saying the stock market would crash. It crashed. In 2005 he said housing would crash. It crashed. In 2013 they gave him the Nobel.

A year at Yale costs $94,100. His course costs nothing.

His name is Robert Shiller. Arthur M. Okun Professor of Economics at Yale. He co-built the Case-Shiller Index — the number every American bank uses to price American housing.

This is ECON 252, Financial Markets, Lecture 6. Filmed at Yale in the spring of 2008, while the crisis was still unfolding outside the window. 75 minutes. Free.

Then the theory he is attacking.

Efficient markets. The price already contains everything known. If a crash were coming, the price would already show it. Under this theory nobody predicts anything and every collapse is a surprise. Most of modern finance is built on it.

Then his evidence.

In 1981 he did something nobody had bothered to do. He took the dividends companies actually paid out over the following decades and calculated what the stock price should have been if it were a rational forecast of those payments. That line is almost flat. The real price swings violently around it. Prices move far more than the facts underneath them ever did.

Then the number.

Price divided by ten years of inflation-adjusted earnings. It smooths out the business cycle. Historically, a high reading has meant weak returns over the decade that follows.

Then the limit, which is the part people skip.

It tells you almost nothing about next year. It is a ten-year instrument. Everyone who lost money "knowing" the market was expensive was using a decade tool as a timing tool.

Then the strange part.

In 2013 the Nobel committee gave the prize to Shiller and to Eugene Fama — the man who built efficient markets theory — in the same year, for the same subject. Two men, opposite conclusions, one prize.

Watch the moment he puts both lines on a single chart. The rational price the dividends justified, and the price the market actually paid. One line barely moves. The other looks like a heartbeat. That chart is what the Nobel was for.

One more thing. Shiller testified before the Federal Reserve Board on December 3, 1996. Two days later Alan Greenspan asked a room whether markets were showing irrational exuberance. Shiller made it the title of the book he published four years later, weeks before the top.

Free on Open Yale Courses.

Bookmark this and watch later — after this lecture every price on your screen will look like a story people agreed to believe, not a fact
https://t.co/1PFQpz8iQJ

[Nyxonx @nyx0nX]

@limalemonnn The tendency he singled out as the one he had underestimated his whole life was incentive-caused bias. A man already rich for decades, at 71, saying he had been getting that one wrong the entire time.

That admission does more work than the list.

[Nyxonx @nyx0nX]

@GeniusGTX Everyone who succeeded can name the book that did it. The people who read the same books and did not succeed are not on podcasts explaining which book failed them.

The explanation gets built after the outcome, not before it.

[Nyxonx @nyx0nX]

$93,730 a year to sit in that room. $0 to watch the same lecture.

MIT's course 14.13 is a full semester on why you make money decisions against your own interest. Not other people. You.

Almost nobody who trades every day has watched a single lecture of it.

This is Frank Schilbach, filmed at MIT, on OpenCourseWare.

Then the first thing he takes away from you.

Standard economics assumes you evaluate outcomes by where they leave you. Your total wealth, your final position. Every model that prices anything is built on that assumption.

It is wrong, and the correction is what most of behavioural economics is.

Then the correction.

You do not evaluate positions. You evaluate changes from a reference point — usually whatever number you happened to start at. The same portfolio feels like a win or a disaster depending entirely on the arbitrary moment you began counting.

Then the asymmetry.

Losses hurt roughly twice as much as equivalent gains feel good. This was measured, not guessed. Everything follows from it: why you close winners early, why the loser stays open for two years, why you check the account more when it is up.

Then the part that costs you the most.

Watch the moment the graph comes up on screen. One line, bending at a single point. To the right of the bend it climbs. To the left it falls away roughly twice as steeply. That bend is where your reference point sits, and everything you feel about money happens on one side of it or the other.

Free on MIT OpenCourseWare.

Bookmark this and watch later — after this lecture, every gain and every loss in your account will show you the number you started from, not the number you have.
https://t.co/1PFQpz8iQJ

[Nyxonx @nyx0nX]

$93,730 a year to sit in that room. $0 to watch the same lecture.

MIT's course 14.13 is a full semester on why you make money decisions against your own interest. Not other people. You.

Almost nobody who trades every day has watched a single lecture of it.

This is Frank Schilbach, filmed at MIT, on OpenCourseWare.

Then the first thing he takes away from you.

Standard economics assumes you evaluate outcomes by where they leave you. Your total wealth, your final position. Every model that prices anything is built on that assumption.

It is wrong, and the correction is what most of behavioural economics is.

Then the correction.

You do not evaluate positions. You evaluate changes from a reference point — usually whatever number you happened to start at. The same portfolio feels like a win or a disaster depending entirely on the arbitrary moment you began counting.

Then the asymmetry.

Losses hurt roughly twice as much as equivalent gains feel good. This was measured, not guessed. Everything follows from it: why you close winners early, why the loser stays open for two years, why you check the account more when it is up.

Then the part that costs you the most.

Watch the moment the graph comes up on screen. One line, bending at a single point. To the right of the bend it climbs. To the left it falls away roughly twice as steeply. That bend is where your reference point sits, and everything you feel about money happens on one side of it or the other.

Free on MIT OpenCourseWare.

Bookmark this and watch later — after this lecture, every gain and every loss in your account will show you the number you started from, not the number you have.
https://t.co/1PFQpz8iQJ

[Nyxonx @nyx0nX]

https://t.co/MayGHybXLQ

[Nyxonx @nyx0nX]

Look at ages 19 to 24. The Gen Z line is the highest on the chart — above Millennials, above Gen X, above boomers at the same age.

The gap only opens after 25.

That is not a generation locked out of housing. That is a generation that started earlier and then stalled, which is a different problem with a different cause.

[Nyxonx @nyx0nX]

@dymiai Exactly. 24/7 access creates convenience. Memory creates continuity — and continuity is where attachment starts to feel personal

[Nyxonx @nyx0nX]

What happens when AI becomes easier to talk to than people?
No judgment. No rejection. Available 24/7.
I went deep on the psychology of AI attachment. https://t.co/LPuO8W1FSu

[Nyxonx @nyx0nX]

In 2000 he published a book saying the stock market would crash. It crashed. In 2005 he said housing would crash. It crashed. In 2013 they gave him the Nobel.

A year at Yale costs $94,100. His course costs nothing.

His name is Robert Shiller. Arthur M. Okun Professor of Economics at Yale. He co-built the Case-Shiller Index — the number every American bank uses to price American housing.

This is ECON 252, Financial Markets, Lecture 6. Filmed at Yale in the spring of 2008, while the crisis was still unfolding outside the window. 75 minutes. Free.

Then the theory he is attacking.

Efficient markets. The price already contains everything known. If a crash were coming, the price would already show it. Under this theory nobody predicts anything and every collapse is a surprise. Most of modern finance is built on it.

Then his evidence.

In 1981 he did something nobody had bothered to do. He took the dividends companies actually paid out over the following decades and calculated what the stock price should have been if it were a rational forecast of those payments. That line is almost flat. The real price swings violently around it. Prices move far more than the facts underneath them ever did.

Then the number.

Price divided by ten years of inflation-adjusted earnings. It smooths out the business cycle. Historically, a high reading has meant weak returns over the decade that follows.

Then the limit, which is the part people skip.

It tells you almost nothing about next year. It is a ten-year instrument. Everyone who lost money "knowing" the market was expensive was using a decade tool as a timing tool.

Then the strange part.

In 2013 the Nobel committee gave the prize to Shiller and to Eugene Fama — the man who built efficient markets theory — in the same year, for the same subject. Two men, opposite conclusions, one prize.

Watch the moment he puts both lines on a single chart. The rational price the dividends justified, and the price the market actually paid. One line barely moves. The other looks like a heartbeat. That chart is what the Nobel was for.

One more thing. Shiller testified before the Federal Reserve Board on December 3, 1996. Two days later Alan Greenspan asked a room whether markets were showing irrational exuberance. Shiller made it the title of the book he published four years later, weeks before the top.

Free on Open Yale Courses.

Bookmark this and watch later — after this lecture every price on your screen will look like a story people agreed to believe, not a fact
https://t.co/1PFQpz8iQJ

[Nyxonx @nyx0nX]

https://t.co/MayGHybXLQ