Psychological Recession
A couple of weeks back, Phil Gram made some comments about the recession that we are in largely being a state of psychological recession. He got a good deal of flack in the media about such comments but I think he may actually be right. Now, keep in mind, I feel that psychologically, if you are thinking something, it becomes or at least begins to reflect such in reality.
To begin with though, let’s do some defining of the terminology we are using. A pretty good set of definitions and a bit of depth in explaining what I am referring to can be found at the American Management Association’s website, in a review of the book One Foot out the Door, by Judith M. Bardwick. The basic idea put forth in the book is that as a mass of folks start to feel a little bit uneasyabout the current economic situation and draw back from the kinds of things that keep our U.S. economy cranked up on high that it becomes a self-fulfilling spiral. Since I had been thinking this as a basic process long before I ever heard of the concept of a psychological recession I felt like this was a no brainer.
After all, just as a person who starts to think they are having a bad day, and the week is not looking promising, and golly gee the month is probably going to be crap ends up having a crap day, unfulfilled week, and generally a bad month. Further, as they slip into this negative thought process, the thoughts they have tend to become more and more negative. Now, until recently the thing I was convinced of in this case was the person just had to stop and see reason for instance and they could break the spiral – that after all it was all either in their head so to speak (excuse my uncouth way with words), or at the least what was in their head was being reflected and causing things outside to hit the target they were projecting. I realize though that sometimes getting someones attention and pointing them in the right direction is just like that proverbial horse and leading it to water – it does not mean they will drink.
Speaking of horses, for those that ride, it is just like working a horse. You focus on a spot on one side of the arena and you are apt to without even realizing it gravitate toward that spot. But a person who is looking not where he wants to go, but where he is not wanting to end up will still end up there because that is where he was focused. Same thing with the person above who is getting blue and same with the economy get negative thoughts churned up about it. The point is, just as negative thoughts about the economy start to ferment in enough mass the negative impact will start to occur in the reality in the economy, the person with depression, or the horse going to the wrong place.
Case in point, the IndyMac Bank corporation in the state of California. There was no question that the bank was on questionable footing and that was a given – just as there are a few others around the country that are in such conditions. However, when it was leaked that the bank was on a federal watch list of some sort for possible problems in the future, a run for cash occurred on the bank and it was a quickly forced takeover by federal authorities to keep the problem from hemorrhaging any worse than it already had. Now, the fact is, if there hadn’t already been a negative housing situation there in California probably the bank would be fine, despite some questionable practices. Even given the housing slump though, the bank could have pulled through and certainly would have held on a lot longer if not the one little negative that snowed bailed and folks who had funds held there let that negative (despite know they had FDIC insurance) blow up and kill a bank almost overnight.
The important thing to know here, when speaking of any psychological process, just because it starts in the mind or even minds of several – that does not mean it is not real or will not lead to a reality that exactly what they starting out fearing to begin with.
