Yes or no. Good or bad. This or that. Our brains are wired to look for easy answers. Sounds lazy, but this thinking was imperative to the survival of our species. Fight or flight. It’s instinctual. Is that a rabbit rustling in the bush or a lion laying prey? Attack or run!
Slowing down to consider the nuances of a situation could have meant the difference between life and death, between having dinner or being dinner. Best to make a quick decision and let the chips fall where they may. Easy, right?
So it’s no wonder folks get antsy about complex problems. Whether it’s business decisions, what school to attend, what major to seek, what relationships to foster, modern life is filled with non-black & white problems.
99% of our problems nowadays are no longer life and death issues. But our brains still want quick answers. Even though it’s no longer short-term survival that’s at stake; it’s long-term fulfillment.
Yet, we demand our answers to be ‘right or wrong’. We eschew ambiguity. However, when it comes to things like, oh, I don’t know… Investing; there’s little room for ‘yes or no’, ‘good or bad’.
Our brains hate this. We want ‘yay or nay’. Thumbs up, thumbs down. That’s why some money managers feel they have to have the balls to act quick and let the chips fall… But, often the answer isn’t ‘better or worse’, it’s “it depends.” It depends on nuanced details like time periods, expense ratios, and valuations.
This can feel unsatisfactory in the moment. But when we stop to consider, evaluate, examine the complexities we become better informed and, thus (hopefully!) make better decisions that are appropriate to our particular goals and tolerances. Of course, this applies to most things in life, not only investing.
These may not be life or death decisions, but they could mean the difference between a life of determination or one of desperation. Happy or sad.
Now that wasn’t so hard, was it?
Live long and prosper,