Written by Ben Carlson
Investors seem to carry emotional scars from the dotcom bubble in 2000, and the debt bubble of the 2008 to 2009 Financial Crisis. Both bubbles caused massive losses for investors.
Hindsight bias causes us to look at past events and assume they were much more predictable than they actually were at the time. It’s the “I-knew-it-all-along phenomenon.”
Since those crashes are so fresh in our memories, we are now subject to knee jerk reactions. Any time an investment rises ...
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