Cognitive dissonance

The following appears in a blog entry about the bear market (emphasis mine):

“People tend to ignore, reject or minimize any information that conflicts with their positive self-image,” their preconceived ideas and their ideological convictions, says John Nofsinger, Washington State professor of behavioral finance, in “Investment Madness.”
“The avoidance of cognitive dissonance can affect the decision-making processes in two ways. First, you can fail to make important decisions because it’s too uncomfortable to contemplate the situation,” Nofsinger says.
People hate conflicting data so much they get nervous when their preconceptions are threatened. Their brain freezes, they self-sabotage and do nothing–and their worst fears become a self-fulfilling prophecy.
The second way we handle conflicting information: “Your brain will filter out or reduce negative information and fixate on positive information,” Nofsinger says. Unfortunately, “if you ignore negative information, how are you going to realize that an adjustment in your portfolio is necessary?” Plus, you miss lots of opportunities.