Welcome to the wonderful world of "faith-based investing" where facts only get in the way of your beliefs. And if you think you're not one, that you're an independent, well, think again. Listen to what shrinks say about America's "faith-based" thinking habits. And take our test.

Seriously, nothing shakes the beliefs of a hardcore faith-based investor, certainly not the facts. New evidence is old news! Retractions are ignored! Contradictions merely confirm convictions! Even an outright admission of a false claim is dismissed as spin!

Click here to visit FOXBusiness.com's Investing page.

Get it! Facts are irrelevant. Not because the world is so complex. Just the opposite, we have too many "facts." No, our tendency to manipulate the facts has nothing to do with the external world. Facts are irrelevant because of the way our brains are wired, say the new neuroscientists.

Your brain is a bio-computer. And every brain has an "operating system" with a lot of subroutines, "belief systems" that help us make decisions (often decisions that undermine our economic best interests). Most of all, your brain needs to be "right," needs to make the facts "fit" with the "operating system." Your belief system creates your reality, not the facts.

This has nothing to do with all the rhetoric about a polarized America: red states vs. blue, conservative vs. liberal, Republican vs. Democrat, us vs. them. In this arena inside the world of the investor's brain, we're not polarized. All brains operate with equal rigidity, are equally biased, equally irrational, equally myopic, equally stuck in mental grooves permitting no compromise.

Why? Our bio-computer's "operating system" is wired with all kind of subroutines, filters and screens designed to interpret, enhance, delete, bounce, reinterpret, recode, recycle and otherwise manipulate incoming facts, data, information, images and ideas to fit our beliefs.

Cramer's crowd vs. Bogle's buddies

Compare extremes: Full-fledged members of the Boglehead Bunch, followers of Vanguard founder Jack Bogle, have as much of a rigid "faith-based investing" brain as members of Jim Cramer's "Mad Money" Mob, the devotees of the cable-television pundit.

Both are controlled by a "faith-based investing" brain. Both have brain operating systems that essentially make their investing decisions on autopilot, based on their operating system's subroutines. Both filter, screen and manipulate the facts to fit their preconceived internal beliefs.

Facts that don't fit the "I love trading" belief system of a Cramer disciple are as irrelevant as any facts that don't fit into the operating system inside the faith-based "I love indexing" brain of a Boglehead. Remember, "facts" do not matter, they are essentially irrelevant for all 95 million American investors, because we're all faith-based investors, whether on Wall Street or Main Street.

Is this news? You bet. Recently I had an epiphany, a profound moment of clarity: Suddenly, an awareness that I'm as much a "faith-based investor" as the next guy. My commitment to buy-and-hold, no-load, lazy, indexed investing — and my absolute rejection of any "irrelevant" facts about market-timing and trading — is just as "faith-based" as all those investors who truly love the thrill of trading, who are absolutely convinced they can beat the market and who think Bogleheads are dull, boring, average and lack faith in the American free-enterprise system.

Like the next guy, I pick and choose "facts" that fit my hardwired belief system. All this became obvious recently while reviewing some fascinating brain research studies by leading neuroscientists, psychologists and behavioral economists. These experts use sophisticated multimillion dollar MRI machines to scan brains and watch how we make decisions. Here's a few studies to stretch your brain:

Rationality gets turned off. During the 2004 election Emory University psychologists tested a group of voters strongly committed to one of the major parties. When shown evidence that a candidate was making contradictory statements, the researchers discovered that instead of thinking rationally to resolve the inconsistencies, our brains actually turn off our rational thinking, ignore contradictions and trust our beliefs, biases and prejudices. Faith beats rationality. Rigid mindsets. Last year psychologists in Australia and America tested people's memories about Iraq War reports that were later retracted because they were false. The researchers discovered that people tend to continue believing bad information even when later news reports prove the reports are clearly false. Tunnel vision. A group of neuroscientists at Harvard instructed a test audience to focus on players dribbling on a basketball court and count the number of times the ball was passed within one minute. Fifty percent of the people totally failed to see that during the middle of the test session a man in a gorilla suit walked through the middle of the dribblers, faced the audience, thumped his chest and left.

The brain's got problems as a computer. And neuroscience is coming out with a steady stream of research that proves over and over that consumers, voters and investors are all irrational faith-based actors whose decisions are controlled primarily by beliefs. And when facts contradict beliefs, the facts are minimized, dismissed, ignored, denied, manipulated or simply reinterpreted to "fit" our beliefs.

Think you're different? Here's a simple test. First answer these three questions.

Are average market returns okay? Or can you beat the market? Are expenses critical in buying. Or do higher returns cover expenses? Is a diversified portfolio the trick? Or, picking the right securities?

If you're a faith-based Boglehead matching the market is OK. You buy no-loads and trust asset allocation. If you're a faith-based Mad-Money Mobster, you hate the idea of being "average." You're a risk-taker who's challenged by the market. You know what I'm getting at: Either way you're a faith-based investor, your brain's belief system makes your decisions automatically and facts are irrelevant. Admit it!

Now for some good news (and the real test): Neuroscientists are now telling us your bio-computer isn't really "hardwired," it has "plasticity." Your brain is "reprogrammable!" But (and here's the catch) reprogramming takes some work. You may need to spend less time on investing and more time challenging your brain with new things, like juggling, dancing, puzzles, ping pong or learning how to play musical instrument or a new language.

If you are a true faith-based investor, your brain just said: What a silly term, "plasticity," forget it, just another "irrelevant fact!" Or something like: Is he nuts? I don't have the time to learn juggling or do puzzles, I'm already doing too much juggling at work. Gotcha?

Click here to visit FOXBusiness.com's Investing page.

Copyright (c) 2006 MarketWatch, Inc.