For some reason incomprehensible to me, Gen Z (and even some millennials) increasingly follow financial advice on social media. As you can imagine, there is a lot of Wrong information on social media, And financial influencers are no exception. However, not everyone falls for wrong information and acts on false news. Some do that, however.
A team of the University of Pennsylvania and the University of Sydney On the way to determine who previously responds to financial wrong information, especially when it is repeated several times. As Joseph Goebbels should have said (although he probably never did): “If you tell a lie large enough and it keeps repeating, people will eventually believe it.”
To check who falls for financial incorrect information, the researchers recruited 114 students for a laboratory experiment and then presented a series of news heads about shares. The difference was that once half of the participants saw the headlines and then they were asked to assess them on how accurately they thought they were. The other half was shown four times the same headlines. The first time they had to judge them on scales, such as how attractive or interesting they found the headlines. Then they saw them again several times for a total of four lighting.
Finally, the lab experiment asked the students to allocate $ 5,000 between shares and a safe investment for money market. They also asked the students to assess their confidence in financial matters and their investment choices.
The graph below shows that students who saw the headlines only tended to invest the same amount in shares, regardless of their level of trust in their financial skills. In the meantime, students who were exposed to wrong information four times started investing more in shares if they had more confidence in their financial skills.
The interaction of repeated wrong information and trust
Source: Yun et al. (2025)
This experiment, together with two follow -up studies, indicated that you need two ingredients to have financial wrong information: the wrong information must be repeated several times and you have a critical mass of self -assured (or should I survive?) Investors who will fall for the lie if it is repeated often enough.
And recommend who the most reckless investors are? When Brad Barber and Terrence Odean Shown so beautiful a quarter of a century ago, it is mainly men and young single men who are recovered in their financial skills.
Is it a miracle that the cryptocurrency space and meme shares are dominated by young men who think they are geniuses?
So at this point I have to agree with Goebbels (and I emphasize that this is the only point that I agree with him). If you keep repeating a lie, (some) people will eventually believe it.
#Goebbels #point