The James Altucher Show: The Most Dangerous Mental Error (You don't know you're making!)
Another episode with Sahil Bloom, and it's a really interesting one too! Here's the full thread from Twitter: https://twitter.com/SahilBloom/status/1510249267352457223, make sure you follow him on there.
Listen to the full episode here:
Listen to the full episode here:
1. Fundamental Attribution Error
(2) Attribute our actions to our situation and context—and not to our character.
We cut ourselves a break, but hold others accountable.
2. Naïve Realism
We tend to believe that we see the world with perfect objectivity.
We also assume that people who disagree with us must be ignorant, uninformed, or biased.
This error sits at the core of many societal problems.
3. The Curse of Knowledge
It makes them unable to teach or lead in an effective manner for those still coming up the learning curve.
4. Groupthink
People set aside their own beliefs or principles to adopt those of the group and appease the whole.
Opposition is silent and decision-making falters.
5. Survivorship Bias
Studying and learning from "survivors”—while systematically ignoring "casualties”—creates material distortions in our conclusions.
We overestimate the odds of success because we only read about successes.
6. Loss Aversion
The pain of losing something is more powerful than the pleasure of winning it.
We will typically do more to avoid losses than we will to seek gains.
We systematically overvalue what we already have.
7. Baader-Meinhof Phenomenon
We constantly notice what is top of mind.
Ever notice that something you just recently observed seems to pop up everywhere?
Like seeing 11:11 on your iPhone clock..
8. Entrenchment Effect
We dig in our heels and form a greater attachment to the idea.
We value being right over getting to the truth.
9. The Dunning-Kruger Effect
People with a low ability at a task are prone to systematically overestimate their ability at that task.
Example: Everyone is a genius in a bull market!
10. Spotlight Effect
This keeps people from being themselves due to an irrational fear of judgment.
It's liberating to realize that most people don't really care about you…
11. Bandwagon Effect
It also creates a strong tendency to do things simply because a lot of other people are doing the same.
"Everyone believes X, so obviously X is true."
Our desire for conformity sways our decision-making.
12. Heaven’s Reward Fallacy
The reality is that a lot of it goes unnoticed—it's thankless.
The pursuit of external affirmation just breeds resentment.
13. Sunk Cost Fallacy
We tend to think we should continue with something on the basis of all that we've put in—with no regard for future costs or the likelihood of ultimate success.
14. Ad Hominem
Instead of addressing the argument and its merits, we attempt to refute the opposition on the basis of personal characteristics.
All-too-common in political—or Twitter—debates.
15. Post Hoc Ergo Propter Hoc
• Event B followed Event A.
• Event B was caused by Event A.
Just because B followed A, doesn’t necessarily mean that B was caused by A.
Correlation ≠ Causation.
16. Personal Incredulity
Complex topics require significant upfront work to understand.
An inability to immediately understand cannot be used to argue the illegitimacy of a claim.
17. The Ikea Effect
We infuse our own self worth into the object, thereby increasing its value in our minds.
18. Confirmation Bias
New data positive? This idea is a winner.
New data negative? Must have been an error in the experiment.
Very common and very dangerous.
19. The Texas Sharpshooter
We select evidence that supports the conclusion while ignoring evidence that may refute it.
Differences are ignored, similarities are highlighted.
20. The Gambler's Fallacy
We have a tendency to believe that past events alter future outcomes—even when they clearly have no impact.
Ever thought you were "due for a win" in roulette?
You're falling prey.
21. Availability Bias
This tends to be the data that can be quickly recalled from our memory.
This is how the news cycle impacts our thinking.
Its persistent negativity cements a belief that the world is dark.
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