How to Ignore the Yes-Man in Your Head

By JASON ZWEIG
WSJ

A mind is a terrible thing to change.

You decide gold is a good bet to hedge against inflation, and suddenly the news seems to be teeming with signs of a falling dollar and rising prices down the road. Or you believe stocks are going to outperform other assets, and all you can hear are warnings of the bloodbath to come in the bond and commodity markets.

A recent study shows people are twice as likely to seek information that confirms their beliefs than they are to consider evidence that contradicts thems. WSJ Intelligent Investor columnist Jason Zweig tells Kelsey Hubbard how this "confirmation bias" can influence their financial decisions.

In short, your own mind acts like a compulsive yes-man who echoes whatever you want to believe. Psychologists call this mental gremlin the "confirmation bias." A recent analysis of psychological studies with nearly 8,000 participants concluded that people are twice as likely to seek information that confirms what they already believe as they are to consider evidence that would challenge those beliefs.

Why is a mind-made-up so hard to penetrate?

"We're all mentally lazy," says psychologist Scott Lilienfeld of Emory University in Atlanta. "It's simply easier to focus our attention on data that supports our hypothesis, rather than to seek out evidence that might disprove it."

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