Risk is Not for Herds

Last week I talked about risk taking and how the willingness to take risk when it comes to investing is critical.  Those people who really want to attain Financial Freedom or FF need to look at themselves to determine their tolerance for risk.

As a real estate investor working towards achieving FF, it’s important to understand your own temperament, and your ability to assume that element of risk.  It’s important to know your limitations and not torment yourself with sleepless nights by taking unnecessary risks in trying to keep up with others whose capacity to assume risk might be much greater than yours.  This decision may slow you down on the road to FF, but what is FF without some enjoyment, comfort and happiness along the way?

Everyone has a level and a threshold for tolerance and excessive and unnecessary risk will only create anxiety and tension and may well shorten your life.  So take a hard look at yourself and measure how much risk are you willing to take that doesn’t make you worry you to the point of causing pain, anxiety and suffering in your life.

But keeping in mind our objective, achieving FF, it is important to remember that the greater the potential risk the greater the inherent reward will be. It is also almost impossible to avoid every risk at any one time in selecting an investment. In order to achieve and maintain high rates of return, which are critical for achieving total FF, one must be prepared both mentally and emotionally to incur a higher than average risk. So look hard at yourself and measure how much risk you can handle.

Remember that “eagles don’t fly together in flocks.”  So if you are going to make it big you can’t just go along with the flock or the herd.  If you earnestly desire to achieve FF today, you must learn to assemble all the facts, calculate the risks, be decisive, and then act accordingly.  Statistics and history prove that the majority of people fail to ever become FF because they do not have a specific plan. They are content and willing to wait patiently throughout their lifetime for Social Security or they are looking for that one super great investment or the lucky lottery number to suddenly become super rich.  Don’t follow those kinds of people. Work on your plan that will take you to total FF over a reasonable period of time and you will reach the level of Financial Freedom that you set as your goal.

The Risk Hurdle

Financial independence or Financial Freedom (let’s call it ‘FF’ for short) carries many connotations. Ask ten people what these terms mean to them and you will probably get ten different answers.  Many people today have dreams of becoming financially independent, however only a small percentage of the population actually achieves this envied position in life.

FF does not necessarily mean being rich or having a million-dollar bank account.  It simply means having enough money to do what you want to do, when you want to do it. It means you are free from money worries, so you can pursue the things that interest you most in life.  Having FF doesn’t necessarily mean retiring and giving up all your ambitions and goals in life to just grow old.  Actually, quite the opposite is true. It allows you the freedom to put more time and effort into your work or hobbies than ever before, but from a new perspective–that of personal fulfillment and enjoyment from doing work because you want to and not because you have to.  This is true Financial Freedom!

A rather fatalistic poet once wrote, “Life to many is but a constant struggle for a mere existence, with the assurance of losing it at the last.” This is a sobering thought when you consider the United States to be probably the wealthiest country and one of the most productive in the world.

FF does not come easy. Achieving it does require some sacrifices and an element of risk.  It’s human nature to avoid taking risks and who likes to make sacrifices? After all it’s easier to spend your earnings or maybe put some money away in a safe and insured account where your hard earned money is guaranteed a fixed, albeit a very low but stable return. This then, is the great paradox in achieving FF in today’s world.

It is virtually impossible to avoid all risks at one given time, because no matter what course is taken with investment dollars, there will always be a certain degree of risk involved. The real estate investor has to be prepared to take calculated risks and be willing to enter into the unknown, if they truly want to achieve FF.

To state the problem without at least suggesting an answer is unfair. Next week we’ll talk a bit more about this, about why we are averse to taking risks even when FF is our highest desire. Understanding why can be key to recognizing where your hesitation comes from and gives you a chance to conquer it!

The Breath-Mind Connection

So how about this breathing thing.  I showed you last week how just the simple act of smiling can help to change how you think and how you feel. But how can breathing change your brain?

I’m pretty sure all of us have seen this–when we experience a big scare, our breathing speeds up immediately. This response in the increased speed of our breath also occurs, to varying degrees, when we are under any kind of stress. And as you might guess from reading my posts the last couple weeks, faster breathing can also increase your feeling of stress. The obvious conclusion is that you will want to slow your breathing to help manage and alleviate stress.

I will never forget watching this TV special with a yoga practitioner that had been hooked up to heart rate and blood pressure machines before sitting down to meditate. He assumed his yoga position and began using his mind to slow down his breathing. As he did, the monitors showed that his decreased speed in breath also resulted in his heart rate and blood pressure dropping.  It was a great demonstration of that mind-body connection we’ve been talking about.

Amy Cuddy in her book Presence quotes a psychiatrist and a PTS expert Bessel van der Kolk who said, “Some 80 percent of the fibers of the vagus nerve (which connects the brain with many internal organs) are afferent, that is, they run from the body into the brain. This means that we can directly train our arousal system by the way we breathe, chant, and move, a principle that has been utilized since time immemorial in places like China and India.”

Amy goes on to say “That’s one of the reason yoga can change the way you feel–it naturally prompts you to breathe slowly and rhythmically, as you do practices such as chanting, tai chi, qigong, and meditation. But you don’t need to do any of those; you can reap the benefits of breath control almost anywhere at any time. With a few deep, slow breaths, you’ve just changed your body and your mind.”

She goes on to give this good advice: “Take a second right now to focus on your breath. Inhale quickly, then slowly exhale.  One more time. Inhale for two seconds, then draw out your exhale for around five seconds.”  Go ahead. Do it over and over again and see how it makes you feel.

I find the beauty of all this–power posing, smiling and controlling the breath–can all be done at the same time or done one at a time at almost any time or in any place. Such simple practices can make changes for the good in your life.

Ok … maybe we are better off not power posing on an airplane. You never know how the crew and other passengers will take that.

The Smile-Mind Connection

I had such a great response from last week’s blog on the power and confidence that is generated from ‘power posing’ that it motivated me to dig deeper to try to find other body-mind and mind-body connections that can help and improve people’s lives. The two that caught my attention were smiling and breathing. Let’s start by checking out that Smile-Mind connection this week.

There are some fascinating conclusions that come from several studies behind what the human smile can do for the body and the mind. Research has shown over and over again that the simple act of smiling reduces stress and, just like power posing, smiling releases endorphins in your brain which make you feel happy in addition to relieving stress.

Additionally, I was quite surprised to learn that studies have also shown that even if you force a smile your brain can’t tell it’s a fake and it will release the same good endorphins and reduces the harmful levels of cortisol in your body.  So hey, why not start forcing a smile even when you don’t feel like smiling at all? You should soon find your smile is no longer forced!

We can all learn a lesson or two about smiling from kids.  Watch them at play.  How much do they smile?  Even if they are only playing with a card board box that delivered a toy for their sibling, you will no doubt observe lots of laughing and smiling.  Kids usually smile about 400 times a day whereas even happy adults have been found to smile only 40 or 50 times a day. Worse yet, the average of all adults is only 20 smiles a day. That is little more than one smile an hour while we are awake.

So, okay … let’s all start smiling more, even when we don’t feel like it. I started doing the smile thing while power posing and it seems to be working. Besides, there is certainly much to smile about in your life. If you don’t think so now, try smiling more often and I bet it will be easier to see as well as feel the joy in your life.

Next week we’ll get to that other connection I found so interested—breathing and how it can change things in our bodies.

For many years, science has proven that there is a definite mind/body connection. That is, our thoughts and self-talk can stimulate changes in our bodies. We’ve all experienced changes in our bodies when, for example a sudden fearful thought pops into our mind. Our bodies can quickly begin to perspire, produce adrenaline, or make our faces flush.

Likewise, a very pleasant thought or positive self-talk can relax our muscles, slow our heart rate and even lower our blood pressure. If we use that mind/body connection in the right way, we can make big and positive changes in our lives. I have certainly experienced that on the tennis court by doing a lot of specific positive self-talk before I play a match. I repeat over and over again statements like, “I have great stamina and energy,” I have a very powerful serve,” or “I stay positive and upbeat.” On the negative side, I learned a long time ago not to say, at critical times in a match, things like, “Oh, I just can’t double fault now!” as apparently the brain locks onto the “double fault” words and misses the word “can’t”. And yep, that’s when a double fault happens.

But now comes some new discoveries about this connection. It’s kind of the reverse—it’s a body/mind connection. Several recent studies have shown that certain things we do with our bodies send a message to our brain. Those messages can be very helpful or very hurtful.

This body to mind connection was introduced to me just last month when I heard Amy Cuddy, an American social psychologist, talk about it. I was so surprised and impressed that I bought her book, Presence, the first day it was released. What a great return I am getting as I see and understand more about how the body can change your brain.

Last week I quoted Amy on the subject of better ways to set new years’ resolutions by using baby steps and nudging yourself. I thought her advice on goals setting was good but Chapter 8 entitled “The Body Shapes the Mind” uncovers, what I think, are brilliant ideas. Amy Cuddy, along with some very bright collaborators, began experimenting to see if the human body holds certain poses for about two minutes would that affect or change the human mind. They chose 5 positive poses and 5 weak poses. Probably the most powerful pose was standing up very straight, shoulders back with hands on your hips–what she called the superman pose. Not only did that pose make the person feel much more powerful, happy and confident it also improved their body chemistry. By using blood samples and saliva samples they found that the men and women who participated in the study showed a 19 percent increase in testosterone and a 25 percent decrease in cortisol–which is a stress hormone.

On the other those people that held a 2 minutes low-power pose like slumped down in a chair, head down and tucked in arms, had a 10 percent decrease in testosterone and a 17 increase in cortisol. Amy goes on to say “the way you carry yourself is a source of person power–the kind of power that is the key to presence. It’s the key that allows you to unlock yourself, your abilities, your creativity, your courage and even your generosity. Taking control of your body language is not just about posing in a powerful way. It’s also about the fact that we pose in powerless way much more often than we think and we need to change that.”

So when you want to feel better about yourself and feel more powerful in your life, remember that how you hold your body can change things in your brain. I’m going to start power posing before my tennis games like Amy does just before she gives a speech. In the quiet of her hotel room she stands in the superman power pose for 2 minutes which gives her the right attitude and confidence to go out there and give a terrific speech!

Reflections in Lieu of a Christmas Card

Now, a week before Christmas I received this email from a very dear friend of 40 years.  He’s a great guy, now a retired doctor, whose life was turned upside down 2 years ago when he was diagnosed with Pancreatic cancer and given only a few months to live.  After going through a 9-hour surgery and painful recovery he’s still hanging in there and has embraced life with incredible energy and enthusiasm, fully living life every single day.  He is a positive, lovable human being who is setting a wonderful example for all of us, a man I am proud to call a great friend.

Here is his “Reflections in lieu of a Christmas Card”

I stayed out of the hospital this year.

I played golf or pickle ball almost every day.

I enjoyed friendships, new and old.

I’m learning to say goodbye reluctantly to some
friendships that didn’t work.

I made a few new friends.

I love my kids and grand kids who each seem to be
on their own unique journey.

I continue to know less about more.

I own my own faults and will probably keep
most of them.

I travel less and enjoy my home and Robyn more.

I value things less and ideas more.

I totally reject trying to change anyone else.

I seek forgiveness for hurting anyone.

I reject exclusion, pettiness, manipulation, passive
aggressiveness, and revenge.

I love knowledge, insight, information.

I love competition and discussion.

I reject polarization, cliques, political and
group collectivism.

I advocate for things I believe and not for groups,
causes, or labels.

I advocate for health, fitness, and science.

I love animals more than people.

I reject political correctness and distribution of
wealth.  I advocate for self-determinism.

My identity is not in my possessions.

I resolve next year to reduce drama in my
life by avoiding those who need it.

I want to live as long as possible if there is good quality.

After pancreatic cancer, I’m not afraid of much so
I will speak to my beliefs.  You can have yours
so don’t be offended.  I can disagree with you
and love you.  Don’t react with anger.  Just
listen or not.

I can’t be offended unless I choose to be.

Life is short, don’t withhold love.

Don’t take yourself seriously.  Laugh at your
mistakes and embrace them.  Don’t worry
about what others think.  Worry more about
what you think of yourself.  I want you happy.

If this all sounds pontifical, it probably is.  It’s me at my best and worst.

Love to all.

–Craig Davis

More Notes on Beautiful Uncertainty

As I promised in my last blog here, I have other high points from Pema Chodron’s wonderful book Living Beautifully with Uncertainty and Change. These super great gems will not only save you time but I really believe they can help most people’s lives in a big way. And maybe it will even motivate you to read her book.

Page 52: One big key that Pema talks about over and over about is “mindfulness”. I need to work on this more in my daily life.

Page 56: “And even when fame is achieved, does it bring the happiness that people anticipate?” Consider how common it is to have wealth and fame but be miserable, like Michael Jackson, Marilyn Monroe and Elvis.

Page 72: When one gets to speak or teach, remember to not tune out others; try to pick up on their feelings, etc.

Page 73: Let go of negativity about other people.

Page 72-73: A monk taught Pema to practice saying to herself when waking up, “I wonder what will happen today; that’s the spirit of taking a leap.”

Page 104: Chogyam Trungpa’s comments on ‘enlightenment’. Basically it is when you hear or see or smell something for the first time like you did when you were a child; that’s enlightenment and I do need to pay more attention to those things around me to have more enlightenment, and look deeper to see or experience new stuff.

Page 108: Be fully open to whatever is coming along right now.

Page 111: To know self is to forget the self.

Page 112: To forget self is to be enlightened by all things.

Page 115: Embrace the world as it is.

Page 115: “Peace and prosperity come from how we, the citizens of the world, are working with our minds. By not running from the vicissitudes of life, be fearlessly opening to them all, we have the opportunity not only to change our own life but also to help change the earth.”

Page 133: Pema ends her book by saying “… so I leave you with a question: Are you ready to make a commitment? Is the time right for you to commit to not causing harm, to benefiting others, to embracing the world just as it is? Are you willing to make any–or all–of these commitments for a lifetime or a year or a month or even a day?”

It’s so interesting to me to write these words that I’ve read so many times before and realize that, once again, the review motivates me to work on these great principals to enhance my life. It’s amazing how most of us humans know something and know it well but tend to neglect that knowledge way too quickly. We get distracted and stop doing, thinking and living what we once learned. It tells me one more time to keep reviewing and reviewing and reminding myself. Remember this great quote “To know and not to do is not yet to know.” –Guru Neem Karili Boba

Just a Little ANT Spray

Last week I talked about those damn ANTS (Automatic Negative Thoughts) and how they can invade you and influence your body and your brain. Sometimes they come by the dozens or even hundreds and can ruin your hour, day or even your life.  So how does a person get rid of those ANT’s—what do we use for an ‘ANT’ spray? How do we program our brains to stop the ANT’s from marching one by one through our minds?

Here’s 3 ways to control those ANT’s, given to us by Dr. Daniel G. Amen.  He and others have discovered that just like negative thoughts that can go deep into the limbic system of the brain, happy thoughts have been shown to affect a person by “cooling of the deep limbic system”.

No. 1: When you have those ANT’s, try to quickly think happy thoughts that can push the negative ones out. “Every time you have a good thought, a happy thought, a hopeful thought or a kind thought, your brain releases chemicals that make your body feel good (and cools your deep limbic system),” says Dr. Amen.

No. 2.  Your thoughts are not always correct. “Your thoughts do not always tell the truth,” Dr. Amen again tells us. “You don’t have to believe every thought that goes through your head”. The lesson here is to challenge those negative thoughts that you at all suspect are not true.

No. 3.  Pay more attention to your thoughts. That is, be very aware of what your chatter box is saying, pay attention, and when they are negative, talk back to them.  To quote Amen, “If you can correct negative thoughts, you take away their power over you.”  He goes on to say, “One way to crush these ANT’s is to write them down and talk back to them.  When you write down negative thoughts and talk back to them you take away their power and help yourself feel better.”

Last night I had some very negative thoughts as I didn’t plan on staying the night in cold Idaho Falls, Idaho. I was visiting my brother and had the entire day planned out, but a minor car problem had made it impossible for me to drive home.  As a result, I was having an invasion of ANT’s. So I started talking to myself and changing those negative thoughts to “Hey, wait a minute. Now I can spend more time with my brother and his wife and talk about all the good memories of our childhood etc.” Wow, things started to change big time in my head. I took a long walk in the brisk night air and listened to the loud mooing of the cows and the strong field and farm aromas, staring into the beautiful sunset sky as I watched literally hundreds of geese flying overhead. My brain, my mood, my whole being was lifted so high I felt I was 50 years younger. It brought back so many fond childhood memories and I felt I was walking on air.  Talk about quickly killing thousands of ANT’s!

Even now, a day later, my body is still reaping the huge benefits of denying the negative thoughts and replacing them with positive brain activity. It’s not just a momentary thing that you change when you get rid of those ANTs, it’s can contribute to a whole better outlook on life.

 

 

Eradicating ANTs–It’s a Mind-Body Connection

You are walking along the side of a busy road when suddenly a car swerves and is heading right for you! You are just ready to jump out of its way when the car self corrects and doesn’t even come close to hitting you. So now how do you feel? Well, if you are like everyone else on this planet you’d feel a huge rush of adrenaline flow through your entire body. So what just happened? Well it’s pretty simple. Your brain sent a super quick signal to your body to prepare it to take evasive action. That action may even have been you jumping faster and further than you ever thought possible.

I don’t think that the average person really understands or fully appreciates how big the connection is between the brain and the body. You see science has pretty much proved that our thoughts send electric signals throughout our brain. Yes, our thoughts have physical properties. Then messages can and do get sent to virtually every cell in your body. Why is knowing this important? Because by using or directing our brains and thoughts we can overcome anger, depression, sadness, negative thinking and yes, even our body temperature, heart rate and blood pressure.

A few days ago my daughter shared with me a manuscript written by Daniel G. Amen, MD (I think it came from one of his many books) entitled “Ant Therapy” or “How to Develop Your Own Internal Anteater to Eradicate Automatic Negative Thoughts”(otherwise known as ANT’s). A fascinating read indeed. It’s all about understanding the direct connection between thoughts and your body and how to automatically turn negative thoughts into positive ones to greatly improve your life and relationships.

The connection between mind and body he points out is clearly shown by observing a polygraph or lie detector test. He points out that a lie detector test measures heart rate, blood pressure, breathe rate, muscle tension and how much the hands sweat. He goes on to state, “The tester then asks questions like ‘Did you do that thing?’ If the person did the bad thing his body is likely to have a ‘stress’ response and it is likely to react in the following ways: hands get colder, heart goes faster, blood pressure goes up, breathing gets faster, muscles get tight and hands sweat more.” And all of that is the results of the brain sending messages to the body.

If we really understand what is happening in our brains, we then can turn things totally around and start reaping big benefits for our bodies and life. Amen further says, and we all need to burn this into our brains, “Remember, the deep limbic system is responsible for translating our emotional state into the physical feeling of relaxation or tension.”

So how do we control or program our brains to automatically turn our negative thoughts that are causing problems in our lives to positive ones that will improve virtually everything we do? Those answers will be given in next week’s post. But do consider sharing this weeks’ blog along with next with week’s with friends or relatives that you think might benefit from knowing more about the brain body connection and how to control it.

Forging Past the Fear

Well I did it! I gave my one-hour presentation to the MBA students at Utah State University on ‘How to Make Millions by Wise Investing’. If you recall from last week’s post, this speech had caused me some fear and anxiety. But after 5 or 10 minutes the fear and anxiety that had been gripping me diminished and finally totally disappeared. The students were great, as was the professor. They asked some great questions and it all went quite well. Yay! I guess I acted out the title of Susan Jeffers great little book Feel the Fear and Do It Anyway.

It’s fascinating to me that a huge percentage of people don’t step outside their comfort zone when it comes to investing as a direct result from that thing we know as fear. It might be fear of the unknown, fear of losing their money or sometimes just plain fear of taking any risks at all. I look back at my younger years (now called “my warrior years”) and remember how quite a few of my peers, people that were just as smart as me and sometimes a lot smarter, knew what I was doing and how I was doing it and, yes, knew that I was having some very big financial gains. However, they didn’t dare step up to do the same thing I was doing. I’m pretty sure the reason was primarily because of fear.

Looking back now I’m pretty sure I didn’t share with them that I had huge fears myself. The thing is, I forged ahead anyways and took the risks and it paid off. I wish I could go back in time and share those fears that I felt with those friends. I think if I had done that then many of those people might have taken a few more calculated risks, pushing past their fears and ending up with the kind of success that I experienced.

I think you would agree that many of our fears come from us thinking  things like “Oh, what if I fail? What will my friends and family think of me? What if I lose all my money?” But like I told the MBA’s, everyone fails from time to time! The key is to learn from your mistakes and be sure not to beat yourself up. It’s okay to fail. No human is immune to failure but if you pick yourself up and keep trying, your success, in investing to create your fortune or just about any part of your life, will far outweigh your failures.

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