Hindsight bias makes surprises vanish.

Experienced happiness refers to your feelings, to how happy you are as you live your life. In contrast, the satisfaction of the remembering self refers to your feelings when you think about your life.

People are really happier with friends than they are with their families or their spouse or their child.

Finally, the illusions of validity and skill are supported by a powerful professional culture. We know that people can maintain an unshakeable faith in any proposition, however absurd, when they are sustained by a community of like-minded believers. Given the professional culture of the financial community, it is not surprising that large numbers of individuals in that world believe themselves to be among the chosen few who can do what they believe others cannot.

The illusion of skill is not only an individual aberration; it is deeply ingrained in the culture of the [investment management] industry.

To know whether you can trust a particular intuitive judgment, there are two questions you should ask: Is the environment in which the judgment is made sufficiently regular to enable predictions from the available evidence? The answer is yes for diagnosticians, no for stock pickers. Do the professionals have an adequate opportunity to learn the cues and the regularities? The answer here depends on the professionals' experience and on the quality and speed with which they discover their mistakes.

You should expect little or nothing from Wall Street stock pickers who hope to be more accurate than the market in predicting the future of prices. And you should not expect much from pundits making long-term forecasts.