Around the globe financial markets are in sharp decline and the end is not in sight. A bloated housing market in the U.S., stupid policy by the U.S. congress, irresponsible consumers, and greedy Wall Street types have all contributed to the financial tsunami that began in the U.S. and has spread around the world.
Many wonder what the connection is between the U.S. markets and Asian, European, and other international markets? Why have they fallen as the DOW plunges downward? There are some rather meaningless monetary connections but the principal common denominator is simply fear.
Global citizens are not unlike we Americans in most ways. Our cultures and languages are different but we have the susceptibility to run away emotions and fear in common. Even after a bone headed congress ripped U.S. taxpayers off to the tune of $700,000,000,000 (billion) dollars and the problems weren’t fixed over night, people have been gripped by fear of the unknown and the result is stupidity unleashed.
The most elementary rule of investing in the stock market is “Buy low and sell high”. Tens of thousands of Americans, who are making emotional decisions, have started to sell assets and run from the market. And the more people liquidate investment dollars the more fearful people sell off and the market spirals steadily downward. Almost all of the problems we have experienced this week are driven by fear, the “Fear of Falling”.
Americans are fed a steady diet of bad news by news anchors who are almost giddy that things are terrible because they know the Democrats are vested in loosing wars and failing economies. Without one or both, Democrats don’t have a chance of winning the White House. And, on both sides of the political foot ball, campaigns are using tactics to create fear of the other candidate.
I remember as a young boy going to the movie in down town Asheville where i would sit in paralyzing fear watching a scary movie. I remember watching a scene in a movie not many years ago and being so tense my body was sore in anticipation of an impending murder. The fact is, in both instances, is was completely safe. I was in no danger other than the damage that might ensue from eating buttered pop corn. Our emotions will lie to us. The sooner we realize that emotional decisions are often bad ones, the more likely we are to be calm and collected in the face of bad news on the 6 o’clock news.
When President Franklin D. Roosevelt was sworn into office the country faced more dire circumstances than we face today. In his inauguration speech Franklin said “The only thing we have to fear is fear itself“. Perhaps those words are more true today than when they were spoken in 1932. The economy will turn around the very day that most Americans have hope that things will get better. Unfortunately we do not have strong leadership in either political party who can effectively convey the message of hope to the nation. In the absence of hope, as a nation we will continue to know “The Fear of Falling”.
The personal, individual solution, is to make important decisions based entirely on facts, not on fears. We should vote, invest, purchase real estate, and decide every other important event of our lives based on factual information if at all possible. To do so requires more than watching the news on TV or reading forwarded emails on your computer monitor. In my view most people are too lazy intellectually to make good decisions about most anything.
Finally, who do you trust with your future? I hope you are finding your security in God and a relation with Him through Jesus Christ. Pity the man who trusts in what he possesses.