Why does it always seem like the world is (almost) coming to an end?
June 22, 2022
Terrible events dominate the news. There was an endless stream of bad news when I was listening to Today on BBC4 this morning. But are things really that bad? Recession. Inflation. War. Nuclear war. The news was terribly depressing, and all the experts BBC talked to said things were getting worse. We also had Larry Summers give a talk on Monday that was deeply depressing.
So is it really that bad? Well, it depends. Context matters.
A friend just got in touch to ask me how he could protect his family against all these horrors. What should he invest his savings in?
In response, I listed all the terrible things that had happened in his 60 years of life, all of which were much worse than anything happening today. And he wasn't that much impacted by any of them.
Working my way backwards:
- March 2020, Covid;
- In the European crisis in 2012, the EU might have come apart, triggering the worst economic and financial crisis in a century;
- October 2008. The global financial crisis that threatened the very core of the financial system;
- 1983, when we almost got into a nuclear war, only to be saved by Col. Petrov;
- The oil crisis in 1973 and 1979;
- Decades of very high inflation;
- Vietnam war;
- The Cuban missile crisis.
If you have any more events to list, please get in touch.
So my friend has experienced a terrible global event one year out of every seven. That almost feels routine.
Besides, whatever seems to be happening today pales in significance with the horror, expected or realised, of these past events.
We tend to focus on the horror in front of us while forgetting past horrors. And why should it be awful today if it wasn't that bad then?
And the media likes talking to those experts who paint the most terrifying picture. The news is biased toward the worst narrative. It wouldn't be news otherwise.
The best way to deal with the financial threats is discussed in my new book The Illusion of Control.