The brain has a mind of its own and we are of two (or more) minds.
Neuroscientists have disproven the long-standing assumption that people have a consistent and predictable set of logical preferences. Different parts of the brain operate in radically different ways.
Money behavior and financial decisions are linked to both mind dynamics and brain activity.
The prefrontal cortex says: “Let’s think about the 12 month game plan and retirement savings.” The limbic system says: “Let’s have that second cognac.” Each part struggles over the same dollar, hopefully without tearing it.
Emotions can corrupt decision-making by short-circuiting attention to focus on the immediate. (But, those who feel no emotion are not good at making certain decisions).
Making people happy is not simply giving them more of what they prefer. The brain’s pleasure center quickly accommodates to new stimuli and expects them to continue.
When someone’s stock portfolio does well, they impute this to their talent and smartness. Gamblers interpret good fortune as skill. My wife and I play heads up poker, and she finally confessed that one of my “tells” is that when I happen to draw a lucky hand, I have a slightly smug look like I think I’m brilliant.