2008 April | Money and Minds

The Neurobiology of McMansions

How Our Brain Structures Led to the Housing Crisis
McMansions.
That is the derogatory term that arose the last few years for the large cookie-cutter suburban subdivisions that seem to have sprung up everywhere. You may have driven through these subdivisions and, much like me, wondered where so many people found so much money. I [...]

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Written on April 30, 2008 | Posted in Mortgages, Psychology | 7 Comments

Don’t Shop Till All Your Money Drops

Shopoholism is a condition where the mind pulls the trigger to shoot itself, the bank balance and the social life. Typically, a shopoholic shops till he drops and then he gets up again and keeps on going, and the cycle continues — yeah, shopoholism is a dangerous addiction that can end up ruining finances and [...]

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Written on April 25, 2008 | Posted in Budgeting, Debt, Money, Psychology | No Comment

A picture is worth a thousand statistics

Several years ago, a friend of mine put two thousand dollars into Owens-Corning stock. Not long after, he took out his original investment, leaving what he had earned; a year or so after that, he took out twenty-five hundred dollars of pure profit. “I want to do that!” I thought, and bought some stock. It [...]

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Written on April 24, 2008 | Posted in Psychology | 5 Comments

Do Trading Systems Work?

Spend any time on the Internet researching investment ideas and you are going to run across myriads of websites trying to sell you their program, book or advice to trade stocks, options, commodities or currencies. Type a phrase into Google similar to the following: “options trading”, “commodity trading” or “Forex trading” and you will get [...]

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Written on April 21, 2008 | Posted in Investing, Psychology | 1 Comment

On Declining Savings Rates

In the times of our parents and their parents, the need to save money was taken for granted. Debt was something undertaken for big purchases, such as houses, cars, and appliances. Most importantly, and this is something you’ll see if you watch an old movie, people stopped going out socially when they ran out of [...]

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Written on April 18, 2008 | Posted in Budgeting, Debt, Money, Psychology | No Comment

When facing a loss, sometimes it’s logic that gets lost.

My wife and I were thumbing through our first quarter financial statements recently and like many people experienced a rough first quarter. In our 401(k) accounts, we each have our share of investments that are in the red for the year. For my wife, one of those investments is a mutual fund that she just [...]

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Written on April 17, 2008 | Posted in Investing, Money, Psychology | No Comment

Welcome to Money and Minds

Welcome to Money and Minds. Our goal is to take you on a tour of personal finance from the perspective of your brain. We follow neuroscience research, cognitive psychology, neuroeconomics, and other similar fields to determine which ideas can apply to your daily financial decisions. Send any ideas or links to us.

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