Midweek Lecture: The Pattern of Self Deception

Michael Shermer’s lecture is excellent, as an investor or trader one must always be aware of their tendency for cognitive biases, we are all guilty of them all the time.

Michael raises a brilliant key concept:
Patternicity, also known as Apophenia or a type one error; is the tendency to see meaningful patterns or connections in random or meaningless data.

“Traditionally, scientists have treated Patternicity as an error in cognition. A type I error, or a false positive, is believing something is real when it is not (finding a nonexistent pattern). A type II error, or a false negative, is not believing something is real when it is (not recognizing a real pattern — call it “apatternicity”).”      – Michael Shermer

Enjoy the lecture!

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