WEDNESDAY WEALTH RECAP
Here’s what’s been happening this week…
- As we begin the new year, Alexander Green reminds readers that trying to control the market is a fool’s errand. Instead, there are three simple techniques investors can use that guarantee higher returns in the coming year.
- Sudden shifts in market sentiment aren’t a matter of if but when. Nicholas Vardy points out that smart investors don’t wait for disaster to strike. They plan for it by crash-proofing their portfolio.
- Chief Income Strategist Marc Lichtenfeld shares the three biggest takeaways from one of the biggest trade failures of his career so you won’t make the same mistakes.
Editor’s Note:
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Click here to watch Alex’s tell-all presentation.
The idea that our bodies are machines has – in one form or another – been around for a very long time, though it’s often attributed to the French philosopher and mathematician René Descartes.
This idea leads us to think that the more we can separate the discrete parts of the human machine and understand the pieces of the mechanism, the more control we can have of our actions.
But the idea that we are machines is far too simplistic.
Back in the days of Sigmund Freud, the world was powered by steam. Everything was pressure, force, heat, release of pressure, explosive pressure…
Because we tend to understand ourselves in relation to the world we live in, Freud and his students created explanations of human functioning – in particular our emotions, drives and instincts – in terms of buildup and release, just like the steam engines of their time.
This formed the basis of the charge/discharge theories of emotional release that were influential in psychotherapy and pop psychology in the ’60s, ’70s and ’80s – and that still resonate in popular culture today.
But we aren’t steam engines, either.
More recently, our brains have been compared to computers, with hardware and software, running programs that we install or have had installed. But though some functions of our brain seem to work that way to a degree, the truth is… we’re not computers, either.
Analogies are fine as far as they go, but all such explanations do is give us a rough approximation of certain qualities or experiences. The worst they can do is give us the illusion that we understand ourselves in ways that aren’t true.
The machine analogy doesn’t do justice to the structure of our bodies and our cohesive sense of self. The steam engine analogy doesn’t do justice to our emotions. And the computer analogy doesn’t do justice to the complexity of our creative, living systems.
We’re much more complicated and elegant than any of these ideas…
At our foundation, we are biological organisms – growing, learning, changing, living beings. I find that understanding this seemingly self-evident truth makes sense of a tremendous amount of human experience and helps to demystify many of our troubles and challenges.
Living organisms are full of cycles, pulsations, rhythms, expansions, contractions, ebbs and flows.
In the springtime, a tree will begin to open leaf buds, and flowers will grow and blossom. In the summer, the flowers will give way to fruit. In the fall, the leaves will begin to drop. In the winter, hidden below the ground, roots will grow while the visible tree appears dormant.
Our hearts contract, pushing blood through our bodies, then expand, taking in more blood to push through with the next contraction. We inhale, taking in oxygen, and exhale, releasing carbon dioxide.
We have periods of wakefulness and sleep that follow our 24-hour circadian rhythm.
We also have what are called ultradian rhythms, one of which has a cycle lasting about 90 minutes and controls periods of rapid eye movement dream time and non-rapid eye movement during sleep. There’s also a basic rest-activity cycle during wakefulness, with high-frequency brain activity for about 90 minutes followed by lower-frequency brain activity for about 20 minutes.
When we try to fight against these rhythms – by not getting enough sleep, disrupting the pattern of our sleep or fighting through those 20-minute resting periods during the day – we can waste a lot of energy and cause a lot of trouble for ourselves.
We’re fluid in so many ways. Understanding this can help us to master ourselves and move with the rhythms of our experience.
Going With the Flow
Here in Santa Cruz, a lot of people surf.
Mastering surfing has nothing at all to do with controlling the waves you ride. Trying to do that would be really silly, and dangerous. The wave is a given; the mastery comes from knowing the waves, understanding their rhythms, their shape, how they move and what they do.
Then you ride the waves as they present themselves, harnessing the tremendous power of their motion for the joy and exhilaration of the ride.
When we experience something big, like losing someone we love, the process of grieving isn’t a rigid and predictable thing. We don’t feel sad and nothing else for an extended period. We don’t predictably go through the stages of grief that psychiatrist Elisabeth Kübler-Ross described in a precise order of denial, anger, bargaining, depression and acceptance.
Grief is much weirder than that.
There are times after the initial shock when we’ll actually feel fine, like a regular day is happening. Then out of the blue, a wave of deep sadness will hit and we’ll find ourselves sobbing. Then, if we allow it, that wave will pass, and we’ll feel something else, maybe even a kind of joy from the love we felt toward this person. Then something else will hit – maybe we’ll feel angry for the loss, frightened for our own mortality or something else entirely.
If we try to control this flow too rigidly, it makes it harder to function – like trying to hold back an ocean wave, we find ourselves instead being thrown wherever the wave propels us. We might end up feeling stuck in a particular emotion we’re holding on to, wallowing in the feelings as though we’re stuck in the muck of a stagnant pond.
But if we accept the wave as it is and ride it, then we can direct ourselves, to a degree, toward where we need to go.
Accepting our emotions, welcoming them even, and redirecting our attention to something else is a much more effective strategy for functioning through strong emotions than trying to ignore, deny or stop those emotions altogether.
Stay tuned. In my next column, I’ll discuss how to master our mood system and reactions.
All my best,
Joel
P.S. My new course, Mastering Emotions, Moods and Reactions, goes into all of this in much more detail, with deep understanding and practical skills for mastering these systems and living well.