It’s A Numbers Game, But Not In The Way You’re Thinking.

51% Is where It’s Happening

Summary:

This article looks into psychological factors brought upon the public by a newly established social benchmark, leading our generation(s) to be one of the ‘loneliest’ in history. We highlighted scientific studies backing up these claims, emphasising the impacts on the human mind to act solely based on irrational emotion. The result — decreased emotional intelligence. Not something you’d need when you’re investing in the market which is within itself inherently emotional and irrational. 

INTRO

Investing, money, success, it’s all measured in numbers right? The higher the numbers the more ‘successful’ you’re deemed to be. 

Well, firstly before diving into this article, your success in life needs to be measured at your own personal metrics. Having the most of something doesn’t automatically render you to be successful by any means, and quite frankly may still leave you unfulfilled. — But that’s your on your plate to think about. 

In this write-up, we covered psychology studies that have been ringing alarm bells in recent times, leading our generation to be the loneliest in our history.

Pretty crazy, right?
Even though we are the most connected generation (thanks to technology) ever to walk the planet, we still feel out of touch, alone, and overwhelmed by anxiety. At this point you’re probably thinking:

“what exactly does this have to do with investing?“

And our answer to you is, a lot! Just bear with us and enjoy the read! 

The Prehistoric Brain

Scientific studies show that our minds are almost pretty much identical to the minds our cavemen ancestors inherited. It’s estimated that our minds hold a 95% similarity. That’s right, our minds have only evolved 5% since we used to use sticks and stones as our main tools to hunt, build shelters and survive in the wild. 

To survive in the wild way back, our minds always had to be forward-looking. If we didn’t inherit this mindset, we wouldn’t have built the civilisations that today we call home. 

When making survival decisions, which in the past occurred way more frequently, our minds would draw up a comparison analysis creating a list of options, shaving it down to 2/3 options, and within a few seconds, a decision needed to be made. And again, back then this often meant life or death. 

Today our minds have it pretty easy, we no longer need to worry about being chased by a lion in the desert, but rather need to choose between Cocopops or Frosties for breakfast. Our minds have arguably become pretty lazy in our comparison analysis:

Life or death/Cocopops or Frosties for breakfast? 

Now here’s where it becomes interesting, and especially for the younger generations. Comparison processes are an inherent part of our frame of thought. Because we no longer need to depend on our survival instincts as much, we’ve become lazy in making our comparisons.  

Our comparisons are now FUELLED by the social media epidemic. 

Comparisons Made Today Are Messing With 95% Of Your Brain. 

Remember our brains have a 95% similarity with our cavemen cousins. This implies that our instincts are inherently pretty much the same, but our way of life is 1,000,000,000 % different. 

Unfortunately our lazy brain has allocated the importance of comparison analysis, not with survival decisions, but with comparing our lives with other people. People we don’t even know (and know) who portray a false reality on their social media accounts. These people are worshiped and believe it or not effect the decision making processes of billions of people worldwide.

These people make it seem normal that you should be living your best life, traveling the world with your model boyfriend/girlfriend, driving around in your limited edition Ferrari whilst also being paid silly money by large companies to sell their products and services to the vulnerable public – Leaving quantities of people unfulfilled.

Although we have nothing against success and the strides towards success, the norm that is being portrayed to young generations stuck at home (thanks to the global pandemic), is having a huge psychological impact, corrupting expectations. The result — Huge Leaps in anxiety, loneliness, lack of fulfillment, and increasing suicide rates.

For the first time in history, our ‘civilised’ populations are witnessing a decline in population growth thanks to suicide. 

The decisions we take to reach this false expectation have put pressure on us to meet what now is normally expected by the public, making us emotionally vulnerable in our decision-making process, and in parallel, less emotionally intelligent.  

For the first time in history, our ‘civilised’ populations are witnessing a decline in growth — Thanks to suicide.

What’s A Common Trait That Most ‘Successful’ People Tend To Have ? 

I recently came across an article covering emotional intelligence, and how successful people tend to have a high level of emotional intelligence, and approach difficult times with numbers in their mind, as opposed to people who were considered to be less intelligent, who frequently drew up their decisions based on emotion as opposed to probabilities. 

One interesting case was when a young businessman, Steven Bartlett got the once in a lifetime chance to interview ex. President Barack Obama. Questions ranged from the day-to-day duties of the president, alongside the not so often duties — like taking out one of the world’s most notorious terrorists: Osama Bin Laden. 

When asked about his decision-making process he emphasised that when problems reach him, they tend to be serious problems. If a problem didn’t reach him, then his staff would have already taken care of it, highlighting the major calls he needed to make. His approach to calling on the strike involved a probabilities game. If Obama needed to act on information brought towards him, he would first study the information, and then once he gets to 51% certainty, he acts. 

People who held a probability mindset similar to Obama were considered to be more successful, happier, and smarter when compared to people who took decisions frequently prompted by emotion. Sometimes it’s the numbers that count. In contrast to this study, the less intelligent was deemed to be someone who frequently acted on emotion rather than anything else.

For science’s sake, emotionally intelligent people have trained themselves to rely more on the rational parts of their brains as opposed to the Limbic part which tends to be triggered once emotion, uncertainty, and fear strike.

The new social norm and pressures portrayed to younger people are unwillingly forcing them to rely on the limbic part of the brain, debatably making many people less critical in decision making. 

People who possess a high level of emotional intelligence tend to make better decisions and consequently lead to a more successful life. 

The Moral of the story — Be like Barack. 

Looking back on the ‘current world’ after reviewing this simple 5-minute read, there has been a striking impact on the emotional intelligence that generations hold today. 

Remember when I said, that the mind is prone to making comparisons? Well, picture this. Today, young (and not so young) people are living a life that has been benchmarked by the rich and the famous thanks to social media. As vulnerable as we are, our minds are quick to make a one, two analysis comparing ourselves to others and what they have achieved, bestowing a high level of insecurity, anxiety, and irrational decisions based on the emotion of it all.

The world is always trying to sell us something, be it a story or a product. This in hindsight has often led us to forget how far we’ve all come on our own individual condition(s) as we tirelessly pursue the next big thing. 

How Does This All Tap Into Our Investments And Day-To-Day Lives?

We find ourselves in our positions today not based on luck, but based on decisions we took many years ago. Decisions taken today will have a consequential outcome on our future. In short, it’s no coincidence that we’re in the positions we are in today. 

In the previous section we placed importance on the thought process carried out by the emotionally ‘intelligent person’ and the common reliance on probabilities. In life, none of us can be 100% certain of the outcome of anything. 100% is a false state of security we use to hide our doubts behind.

Barack’s take on probability is accurate and results in an overall higher level of conviction. As long as you’ve done the research and dug into the information behind your decision/investment, you’ll increase your chances of success. A solid 51% is where you need to get at, and maybe you too might take out one of the world’s most abominable terrorists.

When we make an investment or a decision, we can never be 100% certain of the outcome, but information brought before us may help us reach a higher level of conviction, mitigating the risk factor of failure and placing the odds in our favour. The more emotionally intelligent we become (through practice) the more likely we are to find success. Be it in our investments, in our relationships, in our work, and our lives.

Fighting off the pressures to live up to a false expectation will keep you more motivated, happier and on the right track to your own success, whatever the metric. Not the predetermined, compartmentalised false sense of success that society is portraying before us. 

If you made it this far, congratulations! We’ll conclude it here. 

Conclusion 

Our minds are living in a world that isn’t quite natural. This has led to huge spikes in depression and anxiety as we instinctively compare the lives of the more beautiful, richer, and famous to our own — across all levels regardless of how it’s portrayed in front of us. This thought process has been detrimental to our overall emotional intelligence leading us to plausibly care too much about the less important things. 

If we lose touch with ourselves, the chances of losing control of our feelings will persist leading to reduced, motivation, chances of success, and huge leaps in anxiety, on repeat — the feedback-loop from hell. 

 People have perhaps become less gratified towards their development process and success, as they meaninglessly compare their achievements with others. Although this comparison is instinctive and will not change, accepting and understanding its existence will clear the fog around what’s going on in your head when you’re not feeling quite right.

It’s an infinite game of numbers and probabilities and nothing else. 100% certainty is meaningless, unattainable, and will get you nowhere when making important decisions. Work with the odds — 51% is where it’s happening. Try to apply this process the next time the market crashes, or when you’re facing a difficult decision. Keep those emotions detached when possible.