How Irrational Are You With Money?
Maybe it’s a loaded question to ask: How Irrational Are You With Money?
Okay, I’ll be more forgiving.
How rational are you about spending?
Notice that I didn’t say, “How rational do you think you are with money?”
Here’s why. Most studies in the field of behavioral economics suggest that the answer for the majority of Americans is a resounding, “Not at all.” However, most individuals still assume that they are not a part of that clueless majority. Whether you are good with money, whether you’re not, whether you’re just in denial, the economic indicators are clear, another financial bust will come and almost no one will be able to anticipate it. They never do. Only in retrospect can financial maladies be (falsely) assumed to be understood. Yet they never truly are.
Here’s my assessment on the coming financial crisis. I’ll keep it simple. The education boom is going to bust. More to come.