Error Mode 1: Overemphasizing Cost
"Ask me where I've been," my friend Linda commanded one day.
"Where've you been, Linda?" I asked, though the rustle of tissue being unwrapped from newly purchased goods was unmistakable, even over the phone.
"I've been shopping," Linda said. "Ask me what I bought."
"What did you buy, Linda?"
"Three hand towels. Ask me how much I spent."
"How much did you spend, Linda?"
"Six hundred dollars."
Since this conversation, I actually have used Linda's $200 hand towels. They're nice. Are they $200 worth of nice? Maybe I'm betraying my lowly origins here—I could sleep on a mattress stuffed entirely with peas—but I'd have to say no. Linda's towels feel no better to my untrained epidermis than towels that cost a tenth as much. I can't help wishing she'd bought $20 towels and sent the other $180 per towel to the good folks in Darfur.
But Linda is proud of her towels, as she is of everything in her home, for the sole reason that everything in it costs a mint. Her definition of high quality is synonymous with high price. Now, this can be a useful calculus: Often the most expensive item really is the best. But people like Linda spend vast amounts on cons and crap, too—and as a result, they can end up in a heap of financial trouble.