#73: On Radical Uncertainty, “Phantastic Objects”, and Blowing Bubbles — David Tuckett

David Tuckett is a psychoanalyst, Professor, and Director of the Centre for the Study of Decision-Making Uncertainty at University College London. He founded a new field of research known as “emotional finance”.

Show notes

Selected links

Topics discussed

  • What do modern psychoanalysts do? And David’s journey to founding “emotional finance”. 4:37
  • Knightian uncertainty. 9:52
  • Why is the future fundamentally uncertain? 14:20
  • Does a world of Knightian uncertainty give us carte blanche to believe whatever we want to about fundamentals? 22:18
  • Are extrapolative claims peddled by Australian property gurus in any sense “irrational”? 31:18
  • The great rationality debate and the (limited) contributions of behavioural economics. 40:46
  • The role of emotions in financial decision-making. 57:25
  • Asian buyers narrative in the Australian housing market. 1:06:36
  • What is a “narrative” in the context of market fundamentals? 1:12:18
  • “Phantastic objects” and how to find them. 1:25:19
  • “Divided states”. 1:36:14
  • Not groupthink, but groupfeel. 1:45:00
  • Joe’s statistically insignificant theory about housing bubble bears. 1:52:26
  • A heuristic for spotting when the market views something as a phantastic object. 1:58:51
  • The anatomy of a bubble. 2:00:41
  • Houses as phantastic objects. 2:02:33
  • How small groups of fanatics can blow bubbles. 2:09:41
  • What should policy-makers and central bankers take from David’s research? 2:13:52

One Comment

Nick
October 17, 2019 10:23 pm

Hi Joseph,

First, thank you for this fascinating interview as I am sure I will be replaying it sometime in the future.
I would like to add to your comment about Switzer that from my experience every person also believes and expects the Fed Gov will/to prevent falling house prices and therefore everyone is confident they can’t lose money. I heard this from people from all walks of life – forklift drivers to medical practitioners to accountants.
And who can blame these people when Scott’s only election promise was to defend house prices.

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