Middle East news is getting closer as gasoline prices—Salience Bias [News x Investment Psychology]
This week, news from the distant Middle East has gradually descended closer to our daily lives.
One of the causes is Saudi Arabia's production cuts.
Supply concerns have started to become visible as numbers, rather than just a 'vague sense of anxiety'.
And the aftermath is beginning to seep not only into crude oil prices but also into gasoline prices in Japan.
Last week, the chaos in the Strait of Hormuz itself was the main event.
I feel this week was one where that news started to become visible as 'numbers close to household budgets'.
1. Weekend figures (3/13)
Nikkei Stock Average (closing price): 53,819 yen
TOPIX (closing price): 3,629 pt
Dollar-Yen (17:00): 159.42-44 yen
2. The atmosphere this week
What caught my attention this week was the Saudi production cuts.
Against the backdrop of the deteriorating situation in the Middle East, Saudi crude oil production has fallen significantly. The anxiety we had previously viewed through the words 'supply might tighten' has, this week, become recognized through the numbers of 'supply is actually decreasing'. I think such a change has occurred.
As a result, crude oil prices have remained high, and the rise in gasoline prices in Japan has become easier to notice in the news.
The weekly average for regular gasoline nationwide as of March 9 was 161.8 yen/L. However, there are an increasing number of gas stations where it feels higher than that, and the government has decided to resume subsidies starting March 19.
What is important here, perhaps more than the price of crude oil itself, is the feeling that 'distant news has approached as a cost of living'.
3. What I felt
Even when looking at market news, it is not always the big headlines themselves that strongly move my heart.
'Saudi production cuts' 'Deterioration of Middle East situation' 'Supply concerns'
These words are big. But if that's all there is, they can sometimes remain distant.
However, when it approaches as gasoline prices, it suddenly becomes realistic.
This is because, in daily life, how many yen gasoline costs is much more concrete than how many dollars crude oil costs.
The motorcycle I ride uses high-octane fuel, so I feel the price hikes even more personally during weeks like this.
This week, I felt how that "closeness" changes the way we see the market.
Rather than the weight of the news itself, how close it feels to you changes your emotional response quite a bit.
I think it was that kind of week.
4. Investment Psychology: Salience Bias
This is where salience bias comes in.
Roughly speaking, it is a bias where the mind is easily pulled strongly toward conspicuous information, events that stir emotions, and numbers that appear to stand out more than others.
And the tricky part is that we tend to easily overlook information other than what is strongly in our view.
In this case, the news of Saudi production cuts is also significant.
But what is actually most likely to move our hearts is not "how many dollars crude oil is," but "gasoline has gone up again", a number close to daily life.
That in itself is natural. In fact, I think it is a normal human reaction.
However, when a conspicuous number like gasoline prices comes to the forefront, it can become easy to overlook other factors all at once—such as the changes in supply behind it, government subsidies, and how long logistics disruptions will continue.
Gasoline has gone up. Therefore, the economy must be bad. Therefore, stocks must be in trouble.
That is how we want to connect everything in a single line from one conspicuous number.
This week, I was a little careful about that emotional movement.
That is why, in weeks like this, I try to ask myself this question.
"Is that number just standing out right now? Or is it truly a factor that moves the whole picture?"
I feel that just by adding this one question, I can look at things a bit more calmly.
5. A memo to myself for next week (3 points)
① When a conspicuous number appears, do not immediately connect everything in a single line
Just because gasoline prices have gone up does not necessarily mean the economy and stocks will worsen in the same flow. Look at them separately one by one.
② Be aware that the closer a number is to daily life, the more easily emotions are attached to it
Numbers close to household finances move the heart more strongly than news. That is precisely why, the moment you see that number, you should check once if you are not becoming too anxious too quickly.
③ For news on the Middle East situation, look at how it "reaches living costs"
Do not end with just the fear of war; confirm what is actually approaching your household finances.
6. To everyone who has read this far
How was the market for you this week?
If there was a moment where you thought, "This was the most concerning part," I would be happy if you could let me know in the comments, even if it is just a word (^-^)
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