Financial panics from the prism of psychological perspective, is the topic of a fascinating paper put out by the Boston Fed. We also posted this paper on our Timeless Reading Page Below is a brief excerpt, a link to the full paper can be found here.
In spite of large number of financial crises, often depicted as episodes of financial panic, the notion of panic in financial markets is not very well understood. Many have argued that in order to understand financial crises, and in particular panic events, we need to go beyond classic economic arguments. This paper is an effort in that direction, in which we attempt to give a psychological account of panic and of panic in financial markets in particular, by discussing uncertainty, the desire for predictability and control, the illusion of control, and confidence. We suggest how one might incorporate these psychological insights into existing economic models.
Fastenal: Why Being Cheap Works As a Business Strategy
Fastenal is one of the best-performing stocks of the past decade. Since the beginning of January 2010, shares in the industrial distribution company have yielded an average annual return of 16%, turning every $10,000 invested into $44,264. Q2 2020 hedge fund letters, conferences and more In many ways, Fastenal is not the sort of business Read More