Selection Bias, The Wanting Mind, Bank CDs, and Socially Responsible Investing

July 31, 2009 by TFB

Here are some of the blog posts I enjoyed this week:

Profiles in Selection Bias at The Incidental Economist – Be careful when you read media reports about statistics drawn from different population.

TIE says the media love selection bias and don't know it. I say they don't care whether there is selection bias because they love the attention-grabbing headlines. Think about the audience. Who has time to really think about it?

Understanding and Conquering "the Wanting Mind" at AllFinancialMatters – How do you fight with getting drawn into the latest and greatest? JLP says "STOP LOOKING for a replacement of what you currently have!"

I agree. I'm definitely a late adopter on almost everything. My computer runs on an AMD Duron processor from 2002 or 2003 with 768MB of RAM. It was a budget configuration back then. It's still working just fine. If something is working, I'm not looking for replacing it.

Warning: Banks Automatically Renew CDs Upon Maturity, 7-Day Grace Periods at My Money Blog – Jonathan found out that many banks auto-renew CDs to very low rates when the CDs mature. If you missed the grace period, the early withdrawal penalty can eat into what you earned in the previous term. What a nice trap!

I'm not a fan of bank CDs. Banks run promotions before they drop down to below-market rates. The mere thought of opening and closing accounts everywhere and leaving my SSN behind gives me pause. If I want a CD, I will buy one in my brokerage account. Not the highest rate, but good enough with no hassle.

Low-Cost, Socially Responsible Mutual Funds at The Oblivious Investor – I don't believe in socially responsible investing, for reasons I mentioned in a previous post Unsure About Socially Responsible Investing (SRI). Now I can't help but wonder if charging excessive fees in socially responsible funds is socially responsible to the bleeding heart investors.

From the Archive

Here are two posts I wrote in October 2006. I think they are still relevant today. If you missed them back then, here's a second chance.

9-Step Plan From Dilbert – How many steps have you checked off? I got eight. I can't believe I still haven't got that last one done.

Book Review: The Only Investment Guide You'll Ever Need – Lot of gems worth reminding ourselves:

  • A Penny Saved Is Two Pennies Earned
  • Trust No One
  • In the financial marketplace, you get what you pay for, if you are careful. If you try to get more, you get burned.

Software picked, likely related posts:

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Comments

One Comment on Selection Bias, The Wanting Mind, Bank CDs, and Socially Responsible Investing

  1. Edward on July 31, 2009 | permalink
    2.  

    Whoa Dude, you aced me: 1998 IBM (remember them?) Aptiva 233K6 64Mb (maxed), W98 and 50k DUN.

    Re: CDs
    This is news? Other than the reduction from 10 days to 7, this has been the deal for as long as I can remember. It's no coincidence, I think, that the special offers are an unusual term, like 5, 7, or 9 months. I assumed the banks were counting on the forgetful few. But when you get a notice 30 days in advance, with a form for disposition at maturity and business reply envelope, whose fault is it if you get rolled?

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