This phenomenon sounds to me like what makes the setup for a financial bubble. People are so sure that one (or more) assumptions hold that they ignore all the signs that they're wrong. Maybe "The Semmelweiss Effect" is what you had in mind regarding a standard name? From Wikipedia: The Semmelweis reflex or "Semmelweis effect" is a metaphor for the reflex-like tendency to reject new evidence or new knowledge because it contradicts established norms, beliefs or paradigms.