All of us develop mental maps or schemas for making sense of the world. Our maps are the network of beliefs and expectations that we bring to situations. They are the cognitive lenses through which we see the world.
If others have hurt me in the past, I may develop a network of beliefs and expectations that people are dangerous, that vulnerability is bad. I bring those expectations to future relationships and, sure enough, my resulting guardedness leads others to not reach out to me. As I point out in The Daily Trading Coach, such a scenario reinforces my existing schema, trapping me in a distorted view of the world. "When we are caught in such self-reinforcing patterns, we stop revising our mental maps: we become locked into negative ways of perceiving--and responding to--the world." (p. 165).
We expect losses, so we quickly exit positions, missing the opportunity we had planned.
We see market forces aligned against us, so we stop taking even prudent risk.
We experience ourselves as losers, overtrade to win, and find that our losses confirm our worst beliefs about ourselves.
It's not just that we repeat problem patterns; it's that the repetition reinforces what lies behind those patterns.
Few topics are as important in psychology as revising mental maps. The posts below (and the chapter on cognitive change methods in the book) provide a starting point.
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