The Dao of the Dow

The September 15th issue of the New York Times featured an article exploring our sometimes visceral reactions to awkward social situations. A Cold Stare Can Make You Crave Some Heat by Benedict Carey http://www.nytimes.com/2008/09/16/health/research/16cold.html?_r=1&nl=8hlth&emc=hltha2&oref=slogin cited a new study that shows that when people receive a frosty reception at a cocktail party, they crave a hot drink. You read that right. Being frozen out of a social group—rejected, insulted, ignored—creates the desire to be “warmed up.” According to the article, the language of metaphor can activate a physical sensation, and vice versa. This may explain why we use the terms we do to describe people and situations, and it may also explain why we feel the way we do about events in the external world.

If an unsuccessful attempt to crack the clique at a party leaves us needing to be warmed up, what can we expect from the turmoil in the financial markets, and how can we use the power of mind to overcome a visceral, and possibly irrational, response? Many people have real work to do in the face of Wall Street developments. They may be best off buying, selling, diversifying, deferring payments, making bigger payments, shifting assets, seeking counsel and more. But for the average, long-term Main Street investor the best advice seems to be to sit tight and weather the cycle, and, the best prescription for stomach butterflies may be to sip the equivalent of that cup of hot tea.

The fascinating aspect of the financial debacle is that it is, in part, a reflection of our interior urges—greed, intemperance, laxity, haste, impatience, manipulation, and more. The markets, after all, are merely the external manifestation of the things people do. Industrial averages express the aggregate energy and intention of the people behind them. In reacting to them, we are often reacting, belatedly, to things we ourselves have done or felt, or to the inner upheavals of others. Understanding this means understanding that in the same way we ourselves have good days and bad days, successes and failures, triumphs and tribulations, the markets have them too. The way we respond to our own cycles is a good predictor of the way we will respond to larger-scale cycles that seem incomprehensible and feel uncontrollable.

Simply recognizing that the both internal and external events have cycles helps us gain perspective. Discerning our own reaction to external events requires a bit more mindfulness. It’s easy to see what’s going on outside; sometimes it’s harder to face things inside. Learning to notice the tell-tale signs of our own anxiety—troubled sleep, irritability, sadness, inability to concentrate or focus—as soon as they appear is the best way to nip them in the bud. Think of a saucepan on the burner. We want to catch those negative emotions when they are still little tiny bubbles forming on the bottom of the pan, long before the water explodes into a full boil. If the cold shoulder at a party makes us long for a hot drink, then uncertainty and change in the markets may cause us to seek familiarity and stability. Maybe we want the house immaculately clean. Maybe we want our kid’s room to look like as Spartan and organized as an empty jail cell. Maybe we want all our pencils lined up or we have the sudden need to detail our car—anything to create order inside when chaos reigns outside. These behaviors serve a purpose in helping us restore a sense of control but to make all our little tactics as calming and restorative as possible we must try to notice them. Watching ourselves, we see the little games we play, and seeing them we free ourselves from the hold they have over us. Becoming conscious in this way also helps us with perspective too, and a realistic appraisal of how much we really need for a safe and healthy life versus how much advertising and cultural messages teach us to want.