Monday, September 25, 2006


I went “down the hill” today to run some errands, and as my gas tank was low, I filled up at the Jamul 7/11. I didn’t even look at the price, as past experience suggested that would be depressing.

So when my tank was full and the total was “only” $44, I was shocked, pleasantly so. Actually, at first I thought the valve had shut off prematurely and my tank wasn’t really full — but it was. The price was down to $2.55/gallon for regular, a level we haven’t seen in a long while.

Of course, this only sounds good because just a few weeks ago we were paying almost $4/gallon. It’s that old expectations game again — if you expect a price higher than the actual, why then you feel good about it. If, on the other hand, prices had been under $2 for the past few months, I’d have been shocked in a completely opposite way.

I think humans must be wired this way in general. There’s a simple experiment you can do to prove this to yourself in a dramatic way. Draw a bowl of lukewarm water and put it on the counter. Then draw a bowl of cold water, throw a few ice cubes in it, and put it on the counter. Then run the tap as hot as you can stand to have your hand in it. Put one hand in the cold water, and the other hand in the hot tap water, and leave them both there for a minute or so. You’re setting expectations: one hand will now “expect” to be cold, the other hot. After the minute is up, put both hands in the luke warm water — it’s a very surprising feeling! The hand that was in the cold water will perceive the lukewarm water as warm (or even hot!); the other hand will perceive it is cool (or even cold!). The same water, you’re own two hands, at the same instant, and they won’t be in agreement at all…

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