When people are on an emotional roller coaster, when market prices are screaming up and down from day to day, when no one seems to have a credible viewpoint explaining what is going on – we may find ourselves desperate for answers, when what we really need is perspective. In the words of Ralph Waldo Emerson, “The years teach much which the days never know.” People may want to zoom in, but we need to help them zoom out.
Short-term reactions may scratch an itch, but life is all about the long game. While day to day happenings may be full of noise, history is shaped by the longer-term trends. When the roller coaster ride leads to a purging of nervous questions, we can start by attaching probabilities to ideas. “I know this is going to happen,” is not the same thing as “here are a few scenarios that could happen.” 80% chance of rain is still a 20% chance of no rain. 90% fat free is also 10% fat. Raising uncertainty is how we step back and attempt to take in the whole picture.
We can be as sophisticated as we like by adding specific odds, or we can be as simple as we like by just acknowledging the presence of potentiality. This takes time, effort, and a commitment to slow down. When we help someone to downshift from that heightened state of nervousness, we are helping them to mentally shift away from the noise, and towards clusters of signals and trends. When we successfully take this step, the emotions start to quiet. It’s not a Jedi mind trick – some will put up a fight, but our job is to help them be comfortable with short-term doubts in the presence of a long-term plan.
We can keep Emerson’s quote in mind and remind people (including ourselves) of the value of perspective. There is no one true answer. This is what “the days never know.” We don’t need to look for it because we won’t ever find it. Instead, we have to be aware of it, applying context by considering the trends of what “the years teach.” Where are my risks? Where are the opportunities? How are they spread out not just across assets, but across time? These are the questions. Embrace the process and the results will follow.