24 Jul Ted Talk: Do You Really Know Why You Do What You Do? by Petter Johansson
The following video is in some ways a counter-weight to our book recommendation. We previously touched on the positivity of a healthy dose of optimism, which is an emotion inherently linked to certainty. When making decisions of importance, the amount of knowledge you have on a subject will impact the level of certainty you have in that decision, which will ultimately affect how positively you view the outcome of that decision.
In the attached video, Swedish psychologist Petter Johansson (with the help of some compatriot magicians) explores the idea of reasoning and how an individual’s stated rationale for a decision, which may shape future behavior, might not actually align with their true opinions and feelings.
The findings are quite insightful regarding political alignment, which given the UK political climate over the last 2 years couldn’t be more relevant. However, it also provides some amount of value with regards to personal finance decisions.
Johansson’s studies pose a number of questions: Have certain decisions been made in line with one’s own desires, or have they been influenced externally? And has this process of external influence within a decision-making process ultimately shaped the reasoning given for pursuing a certain strategy? Transferred to a financial context: Is an individual’s reasoning for purchasing a certain security (which may be substantiated with information and knowledge) an intrinsic idea or perhaps influenced by somebody else’s (a neighbour, a friend or a journalist’s) decision/recommendation to do the same thing?
Much like optimism, self-reflection in moderation is a valuable thing. We hope the video will provide some food for thought, not only with regards to trying to understand the decision making of others, but also in understanding one’s own decision making, which if successful, ultimately leads to choices that better reflect one’s own desires and needs.