While it may appear to be a flagrant act of cross-blog-promotion, here’s Riskview’s brilliant response my post from this week called My appetite for risk and cheesecake. In my piece, I wrote about how my brother wanted to travel to Morocco while protests were going on in the Middle East and how my significant other wanted to drive to Buffalo in advance of a pending snow storm.
In both cases, I explained their appetite for risk was greater than mine, but Riskview explains it this way:
(My brother and significant other) are not acting irrationally, they are acting according to their own rationality.
This would be irrational, except for the fact that in some periods of time, they are correct.
Once they start to notice that their view of risk is no longer correct, slowly but surely they eventually change their risk attitude to adjust to the current reality.
Have a look at the entire post Risk Appetite and Risk Attitude.