Much like a company stock, our own valuations are affected by the expectations of our most trusted analyst: ourselves. If we expect something to be really, really fantastic, we will value it more highly than if we expect it to stink. We’ll expect the same wine drunk from fine crystal to taste better than from a cracked mug, and we’ll pay for it, to

Once you have a mug, you don’t want to give it up. But if you don’t have one, you don’t feel an urgent need to buy one. What this means is that people do not assign specific values to objects; it often matters whether they are selling or buying.

If anyone knows about having a lot on the line, it’s Jordan Walters of the Silicon Valley branch of the investment house Smith Barney. Jordan is exactly the kind of person you’d look for in a financial planner: he’s calm, he’s thoughtful, and he always takes the time to listen. As we sat down in his office and sipped from the minibar-sized can of a

William Poundstone comments in Priceless: The Psychology of Hidden Value: