Everyone I know is scared…
January 27, 2009
And a view from neuroscience on the Current Economic Climate
Everyone I know is scared. Workers’ fear has generalized to their workplace and everything associated with work and money. We are caught in a spiral in which we are so scared of losing our jobs, or our savings, that fear overtakes our brains. And while fear is a deep-seated and adaptive evolutionary drive for self-preservation, it makes it impossible to concentrate on anything but saving our skin by getting out of the box intact.
Ultimately, no good can come from this type of decision-making. Fear prompts retreat. It is the antipode to progress. Just when we need new ideas most, everyone is seized up in fear, trying to prevent losing what we have left.
I am a neuroeconomist, which means that I use brain-scanning technologies like magnetic resonance imaging to decode the decision-making systems of the human mind. It is a messy business, but a few pearls of wisdom have emerged about the fear system of the human brain and how to keep it from short-circuiting sound decision-making.
The most concrete thing that neuroscience tells us is that when the fear system of the brain is active, exploratory activity and risk-taking are turned off. The first order of business, then, is to neutralize that system.
This means not being a fearmonger. It means avoiding people who are overly pessimistic about the economy. It means tuning out media that fan emotional flames. Unless you are a day-trader, it means closing the Web page with the market ticker. It does mean being prepared, but not being a hypervigilant, everyone-in-the-bunker type.
I DON’T care what your business is, but if you think it will eventually come back to what it was — your brain is in the grips of the fear-based endowment effect. What I am doing is looking for new opportunities. This means applying neuroscience discovery to realms where it hasn’t been used before.