If you see the same headlines as me, you get a different signal. Most of us have a feeling that the economy will (your choice) crash, soar, flat or bumpy. We are in uncertain times. Now, more than ever, the ability to see it as an opportunity will be your competitive advantage.
A wise and successful mentor once told me, “Kenny, people make business decisions based on only two things: fear or greed.” This is why some investors are Taking money out of the market when the market falls, other investors put their money in to benefit from lower prices and receive a 20% premium for future growth.
While it’s easy for an investor like Warren Buffett or Jim Cramer to say a down market is a buying opportunity, when you’re not a millionaire, it’s It’s a bit difficult. And, remember, it’s not just about investing in your 401(k) plan or buying more cryptocurrencies (be careful!), it’s a double whammy for your business, marketing, and talent.
So, how do you train yourself to be someone who looks for opportunities in uncertainty?
First, understand and adapt to fear. Feel it, sit in it. Learn how it looks and feels. Then, plan for the worst. Finally, practice EQ (emotional intelligence) to face fear.
This is how I understand fear. I read JP Pawliw-Fry’s bestselling bookPerformance Under Pressure, in which Pawliw-Fry studies the military, Olympic athletes, and professional sports teams to understand How people behave under extreme stress or fear.
The reason we underperform under stress is cortisol. According to Pawliw-Fry, it can change the way you think and react in three main ways.
First, cortisol reduces your working memory. This is the memory that you have to juggle several options. When you are calm, you can see every aspect of the problem. When you’re stressed, you usually only see one.
Second, cortisol focuses your attention on one thing, the perceived threat, the event that causes you to fear. The threat could be anything you fear — house prices, inflation, cryptocurrency prices, or the Ukraine crisis.
Third, you default to a self-protection strategy. Always put me first and go to hell with your colleagues, employees and customers.
For example, your fear response to a falling market might be to stop buying stocks, sell positions, lay off your employees, and reward yourself with huge bonuses (if you’re like some CEOs).
Plan for the worst
To behave better in fear , you need to prepare and plan for the worst.
Successful investors, championship athletes, and military personnel are above everyone else because they plan for the worst — and train themselves to excel in times of stress.
Investors like Warren Buffett know what stocks they buy when the market goes down. LeBron James makes a lot of free throws when he’s not under pressure so he can default to training in big moments in the championship game.
For business owners, dealing with fear comes down to having a plan for how bad things might happen. Or, if you’re an investor, you might set aside cash to buy certain stocks or mutual funds as they become more valuable.
Or in my event business, we had cash stored before the COVID pandemic. We actually plan for a recession. While we are not planning to cancel in-person events, having the extra cash on hand gives us a buffer to develop new plans.
Practice good emotional intelligence
What if you don’t have a plan?
If you have no plans or have a new challenge, you can use another technique. I practice the SOS technique (developed by Pawliw-Fry) to help when stress occurs. SOS stands for Stop, Oxygenate and Find Information.
stop. When cortisol enters your body, it takes at least 18 minutes to calm down. Sometimes longer. During that time, your working memory will decrease. So, when something stressful happens, stop what you’re doing. Rest awhile. Get out of the office or home office before you make a hasty decision.
Oxygenation . Next, take some deep breaths. Get some fresh air. Oxygen helps break down cortisol in the body. Anyone who practices yoga or mindfulness knows that focusing on your breath can help calm you down.
Seek information . Finally, when you feel at peace, seek information. Ask yourself: Is this threat real or imagined? For example, is your business going downhill from a market downturn, or are you just worried that you might lose business?
Next, ask others to help you understand your situation. That said, don’t deal with stress on your own. Ask your spouse, co-workers or employees for their opinion so you can learn more about the situation and come up with more and better solutions.
When COVID hit, my events business had money. However, it is not ready to cancel all live events. We did not act alone or make hasty decisions. We stopped, got some air, and asked a lot of advice from mentors and colleagues. This has helped us pivot to virtual events – and increased our business!
When the market falls and the price rises, it is natural for us to feel fear. But if you understand how fear affects you, prepare for the worst, and practice good emotional intelligence, you can stay calm when everyone is losing their minds.
Most people know how to benefit from high tide. Special types that know how to benefit at low tide