Investing–The New Rules: 9 Reasons Doom and Gloom Are Not Cool

There's often much Doom and Gloom before the Boom!

Despite the current mood, there’s reasons to look beyond the Doom and Gloom mentality–nine reasons, to be exact. Rob Bennett runs them all down in this week’s Investing-The New Rules.

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Investing — The New Rules
Doom — and Boom!

#18–August 30, 2010

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Every now and again I happen upon a site that does not buy into the Buy-and-Hold gibberish and acknowledges that we have gotten ourselves into quite a little fix with all the Get Rich Quick stuff. Then it ruins it by veering off into Doom and Gloom. That’s almost as bad!

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Nine reasons.

1) Doom and Gloom is not much more honest than Get Rich Quick. No one knows the future. I believe that we have to face facts and be realistic. But there have been many times in history when the future looked dark and the humans managed to turn things around with a Hail Mary pass. It can happen again. It really is darkest before the dawn.

2) It’s not healthy to dwell on the negative. I have always liked upbeat songs more than down ones. Maybe that’s just a personality thing. But it seems to me that when you start looking at the world as a bleak place, that very act makes it more bleak. You stop trying. You become paralyzed in fear. How does that help?

3) Lots of people genuinely do not appreciate how messed up things are. We need to reach those people, we need to get them involved in constructive efforts. Doom and Gloom turns them off. Doom and Gloom makes them run away in horror. It’s like in the movie Broadcast News where the Holly Hunter character says: “I am beginning to repel people that I am trying to seduce.” That’s a strategic mistake.

4) It puts the focus in the wrong place to dwell on downer stuff. We’ve made a mess of our economy and our retirement accounts. Let’s fix them! Let’s rebuild! When we start doing life-affirming stuff, we will feel better and more energized with each passing day. When we focus on our troubles, it makes us want to roll up in a ball and take a nap until the dark clouds pass. Nothing gets done.

5) There’s a reason why it is darkest before the dawn. The thing that the Buy-and-Holders missed is that pretending that you are richer than you are only provides a temporary high; it deflates you to recognize that the funny money is not real. Optimism leads to pessimism. Well, it works in the other direction too. Once we get scared (and it’s happening), we will put our minds to the task of coming up with solutions. There are going to be great things happening as a result of this economic crisis that we cannot even imagine today. Pessimism leads to optimism. So hang in there!

6) Say that it is all true. Say that there’s no hope. Say that we only have six months remaining until we pull up a Game Over card. What are we going to do, walk around with long faces for six months? Even if the Doom and Gloomers are right, I don’t want to spend my last days worrying about what will happen at the end of the six months. I would rather use the six months to hope and plan and work and laugh. You don’t jump into your deathbed early just because you know that that’s where you are headed sooner or later in any event.

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ALSO at DBKP:
* Investing-The New Rules: Bogle on the Hot Seat
* Investing-The New Rules: Price Drops are Good News
* Investing–The New Rules: The Lily Tomlin Approach
* Investing–The New Rules: Young Investors Taking Hardest Hit
* Planning for Retirement: Retirement Riddle
* Investing–The New Rules: The Godfather Visits InvestoWorld
* Investing–The New Rules: Determining Stock Value Using P/E10
* Investing–The New Rules: The Monster That Ate the U.S. Economy
* Investing–The New Rules: Stocks Are Not Worth Buying Today
* Investing–The New Rules: Sarah Palin Will End Economic Crisis
* Investing–The New Rules: Dollar-Cost Averaging is a Loser
* Investing–The New Rules: John Bogle’s Evil Twin?
* Investing–The New Rules: Stock Return Predictor Not a Case of ‘Too Good to be True’
* Investing–The New Rules: The Stock Investor’s Weather Report

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7) It’s not just that it serves no purpose. Contemplating the end, coming to believe that the end is coming soon, contributes to the problem. One of the things holding our economy back is the fear that people are feeling over their futures. Feeding that fear makes the problem worse in a dollars-and-sense way. We need to stop overspending. We need to stop living in fantasylands. But we don’t need to shut everything down. That’s swinging from one crazy extreme to the other.

I don’t like bull markets. They are the product of emotion and self-deception and the deception of others. Doom and Gloomers would have you believe that they too are anti-bull. There’s a sense in which that’s so. But I see the same level of emotion in Doom and Gloomers that I see in Buy-and-Holders with the only difference being that it is being directed to an opposite sort of vision. Doom and Gloomers can at some point become as irrational as Buy-and-Holders.

9) Doom and Gloom is not cool. Cool is having the courage to conquer your troubles, not letting them wash over and conquer you. Gloom and Doomers have lost their sense of humor. Doom and Gloomers sometimes get so into the negativity that you wonder if they are looking forward to seeing their dark visions come true.

We will overcome the Gloom and Doom, and then — we’ll enjoy a Boom!

by Rob Bennett
images: dbkp file; doomworld

Rob Bennett suggests that you give up television and grow rich. His bio is here. And please don’t even think about failing to read these Important Cautionary Words.

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