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“Keep Calm and Carry On” was a poster produced by the British government in 1939 at the beginning of World War II, intended to raise the morale of the British public in the event of invasion. It seems the entire world could benefit from this advice today.
If you look at recent headlines – from debt limit debates to S&P downgrades to financial market meltdowns, what is the one emotion that seems to drive all actions? FEAR! As Terry Savage wrote in this morning’s Chicago Sun Times: “Nothing engenders fear like a stock market crash. And fear causes economies to slow to a crawl.” Investors small and large, world governments, political parties; all ruled by fear.
But how do you overcome fear? Psychologists remind us that fear is a vital response to physical and emotional danger – if we couldn’t feel it, we couldn’t protect ourselves from legitimate threats. They also remind us of the importance of balancing this powerful emotion. So, here are a few tips:
- Learn about the thing you fear. Uncertainty is a huge component of fear: Developing an understanding of what you’re afraid of goes a long way toward erasing that fear.
- Talk about it. Sharing your fear out loud with a trusted professional, friend or family member can help put it in perspective.
- Live and take action in the present. The things we fear often reside in the future – and are outside of our control. You can only control your actions in the present – what you think, what you chose, what you do - not the outcomes.
Six years before the “Keep Calm” poster was produced, U.S. President Franklin D. Roosevelt used his first inaugural address to assure the American people who were trying to survive the Great Depression: This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today. This great Nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.
Speak the truth. Face realities. Act. I hope these lessons from the 1930s will echo in the halls of Congress and the trading floors of Wall Street in the days ahead.
Today the Wall Street Journal ran an article featuring the work of economists Justin Wolfers and Betsey Stevenson of the University of Pennsylvania’s Wharton School on how the economic downturn has shaken consumers faith in financial institutions and the government. Surprised?
Citing global polling data from the Gallup Organization, the percentage of Americans who say they have confidence in financial institutions fell to an average 44% in 2009 and 2010, down 31 percentage points from 2006 and 2007. Only 23% said they had a great deal or a lot of confidence in banks in 2010. Statistics worth noting, wouldn’t you agree?
The National Bureau of Economic Research (NBER) – a panel of economists entrusted with the responsibility to officially declare the beginning and end of recessions – declared Monday that the longest recession the country has endured since World War II officially ended in June 2009.
Funny; I’m sure there are many Americans that feel like it is still going on.
President Obama spoke to the Congressional Black Caucus Foundation dinner this past weekend and reaffirmed his Administration’s commitment to restoring the economy and creating new jobs.
About 6 minutes into the video, the President makes the point that from 2001 to 2009 the income of middle-class families in the US went down 5%. In other words, the problems that became evident at the beginning of the recession (12/2007) were building for years, and fixing the problems will take time.
Our US Representatives and Senators know this, but if you watch the rhetoric of the political campaign season it would appear that many are content to over-simplify the complexity of our national economy and suggest a quick fix to the sluggish recovery is possible simply by voting in new leadership. Sadly, many American voters will believe the claims of these candidates for office…because they desperately need it to be true.
Steve Chapman with the Chicago Tribune made this point yesterday:
A recession begins when the economy starts shrinking. It ends when the economy stops shrinking and resumes growing — nothing more. The conclusion doesn’t mean we’re getting rich. It merely means we’re not, as a nation, getting poorer. That may sound like a minimal achievement, but it’s better than the devastating contraction that went before. It’s the first step on the path to prosperity. We’re like…a village after the tornado has passed through. The danger may be gone, but there’s a lot of rebuilding to do.
Perhaps the recovery will be quickened if businesses and individuals actually tune out the fear-mongering politicians (whose election depends on an angry electorate) and actually begin thinking and acting as if the recession, in fact, is over. There is money to spend and jobs to create, people to hire and products to develop. Wall Street got the message! What will it take to get the rest of us going?
