Superinvestors and the Art of Worldly Wisdom #58: Peter Atwater On The Great Confidence Divide
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May 6, 2025 
Peter Atwater, an expert on confidence and decision-making, discusses his insights on the dynamics of confidence in the financial market. He introduces the confidence quadrant framework, revealing how emotional responses influence decisions. Atwater delves into the K-shaped economy, addressing the widening wealth gap and its societal implications. He critiques the gambling mentality prevalent among retail investors and explores the ties between low confidence and rising populism, emphasizing the importance of contrarian views and the media's role in shaping perceptions.
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The Confidence Quadrant Explained
- Confidence depends on two variables: certainty about the future and control over outcomes.
- When both are high, we feel comfort and ease; lacking both causes stress and vulnerability.
Confidence and the K-Shaped Economy
- The K-shaped economy reflects a divide in confidence between the privileged and the vulnerable.
- Those at the top feel invincible, while those at the bottom feel intense defeat and vulnerability.
Caligulan Capitalism Defined
- "Caligulan capitalism" describes grotesque excess and invulnerability at the top.
- This blatant behavior signals unsustainable power and money dynamics.
