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Extreme Discounting … be aware of this quirk
By Taking Care Of My Own Business  •  December 10, 2022
You prefer immediate rewards vs. long-term gains. But investing is for the long term. When we are presented with distant commitments, we tend to stumble on the difficulty that our brain has in placing us in the future with any degree of accuracy. Why is that? Because our brain evolved to make determinations about immediate threats and rewards, it’s a stretch to gain perspective even a few weeks into the future. 𝗢𝘂𝗿 𝗯𝗿𝗮𝗶𝗻 𝗶𝘀 𝗮𝗹𝘄𝗮𝘆𝘀 𝗵𝗮𝗽𝗽𝘆 𝘁𝗼 𝗰𝗮𝗽𝗶𝘁𝗮𝗹𝗶𝘇𝗲 𝗼𝗻 𝗮𝗻 𝗶𝗺𝗺𝗲𝗱𝗶𝗮𝘁𝗲 𝗿𝗲𝘄𝗮𝗿𝗱. Economists call this tendency Extreme or Hyperbolic Discounting. S̳c̳e̳n̳a̳r̳i̳o̳:̳ When offered a cookie today or two cookies tomorrow, waiting seems intolerable and we eat today. When offered one cookie in 365 days or two cookies in 366 days, waiting suddenly seems easy and we say we would wait. People more heavily discount the immediate than the distant future, because they prefer a small but immediate payoff over a larger payoff down the road.  ...
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By Taking Care Of My Own Business
Why you should be Taking Care Of Your Own Business or why you should Tacomob. Hi, my name is Andy.Andreas G. Schmidt (aka Andy) What motivated me to create this website? Well, sometimes, one can observe a lot by watching ...
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