mr mouthy
Source: this website

Congratulate me*.
*he said, unashamedly.

This is my 700th post.

Who’d have thought that the first piece I wrote in a small coffee shop on the bridge between the Zone @ Rosebank and the Firs would be followed by 699 others?

So when I realised that my 700th post anniversary would be today, I gave some thought to a topic. The options:

  • A list of favourite posts.
  • A contemplation of a different world (namely, one without banks).
  • A contemplation of a different sort of different world (one without physical cash)
  • Something on volatility (mainly because the VIX index is currently on my radar)

But then I had a conversation with a close friend who lives far away about the meaning of life. And it felt appropriate to put that in writing – after all, most people don’t start blogs to talk about finance, economics and the bitcoin. They start them to indulgently self-reflect on the “deep” questions, which often translates into the indiscriminate re-blogging of tumblr articles.

But fear not – I will not be departing far from the economic base line.

Some observations

In economics, we talk about the “economic problem”, which is actually a statement of scarcity. That is: we live in a world of limited resources, faced with an unlimited number of wants and/or needs.

In religion (that is, in most religions), the central tenet involves God as Love, or Love as pinnacled expression of purpose in the road to eternity.

And in cognitive behavioural therapy, love is defined as having your needs met.

So to summarise:

  • We have unlimited needs.
  • Love is having those needs met.
  • Enter: religion*.
    *And, I guess, thank God that God is infinite?

A Possible Alternative?

There’s a book called “59 Seconds” by psychologist Professor Richard Wiseman, which I frequently gift around to almost anyone that tells me about a life crisis. It sounds like a self-help book, mainly because it is one. But it’s not Oprah book club nonsense about positive thinking and eating right for your blood type.

“59 Seconds” is a summary of the important academic research that’s been done on things like motivation, creativity, persuasion and attraction. And at the end of each chapter, there’s a section that basically says “so given what we’ve found in these studies, perhaps you should try this“. And the “this” could be something like “go to a bathroom stall and stand with your arms raised above your head in a victory position just before you go into an interview – because people who have done that in these studies have been demonstrably more confident after doing so”.

The book opens with a chapter on “Happiness”. And as it turns out, the key to happiness seems to revolve around… Well let me give you the background and experiment first.

  • So you know how you can walk into a bakery, and the first thing you smell is the deliciousness of freshly baked bread?
  • But then after a few minutes, your senses get used to it, and the stimulus fades (unless you keep leaving and re-entering the bakery).
  • Well the theory put forward is that, in much the same way, we get used to the things that we have, and therefore, that they stop giving us joy/utility.
  • Also: “you don’t know what you’ve got til it’s gone”.

So the experiment (conducted by psychologists Robert Emmons and Michael McCullough) wanted to investigate the psychological impact of getting people to do the daily equivalent of leaving and re-entering the bakery. It went something like this:

  1. Take a large sample of people, give everyone a notepad and a pen, and then split them into three groups.
  2. Ask the groups to do the following:
    1. Group 1 was asked to spend a few minutes once a week listing 5 things that they were grateful for in the past week.
    2. Group 2 was asked to spend the same amount of time listing 5 things that hassled them in the past week.
    3. Group 3 was asked to spend a few minutes listing impactful events that happened in the past week (this was meant to be the neutral control group, as the events could have had both positive and negative impacts).
  3. The study was conducted over 10 weeks.
  4. Once a week for each of those 10 weeks, the participants filled in identical questionnaires that asked them about their physical and emotional well-being (questions like: “Did you have a headache this week?”; “Did you ask for any help with a problem this week?” and “If yes, how did you feel toward the person that helped you? Pick the most accurate word: grateful, annoyed, embarrassed, understood, surprised, glad, appreciative.”)

The results:

Screen Shot 2014-06-24 at 8.49.34 AM

Allow me to interpret that for you: the grateful group felt happier about life in general, felt more optimistic about their upcoming week, had fewer physical symptoms, and did more exercise. And that’s after doing nothing more than spending a few minutes a week listing just five things that they were happy about*.
*here’s the pdf of the study if you want to read it.

Putting That Into Economic Terms

In my mind, gratitude is nothing less than an answer to the economic problem.

The way we currently phrase it, we can do nothing about the fact that our needs are unlimited, and that there are only finite resources with which to fulfil them. All we can do is discuss the most efficient form of allocation (ie. to maximise the number of needs fulfilled, given the limitations involved).

But we should also be looking at it from a slightly different perspective, and saying “Actually, plenty of needs are already being met and that should count for something – mainly because the act of recognition leaves you feeling less needy…”

And if your needs are being met, then you feel loved.

And moreover, Loved.