Of Resilience & Icebergs

Change brings unexpected consequences that disrupt our lives every day.  Some disruption seems bad, some seems good.  Most change is just the tip of the iceberg.  We rarely can see the big picture because often bad leads us to something really good if we are resilient.

Being resilient can help us survive and prosper from the base of the iceberg.


Image from imgarcade.com (1)

Take for example, the Wall Street Journal article, “Wall Street’s endangered species. the ivy league jock“. (2)

This article outlines how a decade ago, a preponderance of new hires for bond trading by banks and brokers had all played college sports.  The aggressive nature of bond trading favored those who had succeeded in competitive fields.

This is no longer true because of technological change.  Just as track hoes and back hoes replaced pick and shovel, the computer is taking over from the physical combative spirit.  The number of jobs in this industry is crashing, and the new hires are those who excelled in math and computer sciences, not athletics.

The article says: “When Airbnb can handle two million unique properties at once, and Uber can manage more than a million drivers around the world in real time, are we really saying that a few hundred thousand bond issues can’t be traded by computer?”

If you are a university student, working through school on a sports scholarship, this may seem like bad news.

Certainly there are potential benefits in lowered fees, if you are a bond investor.  Trading fees should be reduced.  A couple of computer geeks can manage the same trading volume that used to require many jocks.

There may be unintended consequences.  Let’s look ahead and imagine.  Right now college coaches are paid a lot more than college professors.  In 2016, Jim Harbaugh, the football coach at Michigan was paid $9.004 million. Nick Saban, at Alabama earned $6.94 million. The top ten university coaches all earned over $4.5 million in 2016.

Even the highest paid US professor earned less than the tenth football coach.  There were only five collage professors who had a seven figure salary. David N. Silvers at Columbia University earned $4.33 million and Zev Rosenwaks at Cornell earned $3.3 million.  After that, the number three, four and five respectively earned a miserly (by athlete standards) $2.6 million, $1.19 million $1.03 million.

How can this be, that coaches make so much more than professors?   The reason is that over the last twenty-five years, college football has turned into a billion dollar industry.  Television contracts have grown dramatically.  Bowl game proceeds have increased as well.  Attendance is massive all over the country.

Is this rampage of spectator activity, in a game that has been shown to dull the mind and harm the body, been sustained, at least in part, because the athletes who perform well have been the top hires at the well paid Wall Street firms?  If so, an unintended consequence in bond trading technology may be a diminished interest in college football.  Perhaps professors of computer science will begin earning more than the well paid college coach.

Would that be good?  Maybe.  Sophistication in computer science is of growing importance.  The hacking of Western democracy by Russia is evidence of that.  The way the NSA weaponized a weakness in Windows programs and then allowed it to be stolen by hackers and used to launch the “WannaCry” virus, history’s largest ransomware attack, is additional evidence of the need for increasingly sophisticated computer sciences.

On the other hand, Physical Education programs all over the US have been weakened.

A Harvard University website article (3) says:  “Almost seven in 10 parents say their child’s school does not provide daily physical education even though experts recommend 150 to 225 minutes per school week”

Can we develop wiser, brighter minds if we do not house them in strong bodies supported by natural energy and good health.

The point is we do not know what consequences the changes in Wall Street hiring will bring.

This is why we need resilience.  When it comes to prospering from change, one fundamental quality, the key to success is “having resilience”.  Resilience is the ability to bounce back from some real or experienced adversity.  When we are resilient, we simply keep trying until our change is positive and complete.  When we are resilient, we never give up, so we can carry on until the consequences of change favor us.

A scientific study entitled “Psychological and social aspects of resilience: a synthesis of risks and resources” (4) at the US National Library of Medicine shows 13 qualities that can help us become resilient.

(Previous messages have looked at six of these qualities.)

The seventh quality for resilience derived from this research is social skills.  Individuals with a positive interpersonal manner who can interact with facility and warmth, who can read their companion’s mood and receptivity, who have empathy for others’ situations, who inspire confidence and trust, and who are engaging and communicative are much more inclined to have help and opportunities proffered to them.

One way to gain better social skills is with repeated inner words.

A  Wall Street Journal article “One Habit to Make You Happier Today” (5) reveals how to use inner words (called mantras) to accomplish more and to create better social skills.

The article says: Research shows that thinking of a word or phrase that affirms our values—and repeating them over and over—produces powerful physiological changes.  It can lower our cortisol levels, enhance endurance and reduce perception of effort during physical exertion.

Perhaps even more compelling, a mantra can quiet the mind.  A 2015 study in the journal “Brain and Behavior” showed that silently repeating a single word led to a widespread reduction in activity across the brain, primarily in the “default mode network,” which is responsible for self-judgment and self-reflection.

Mantras can create and strengthen new neural pathways that are positive and not toxic. And that can make our brain much calmer and happier.

We can think these words to create neural pathways that help us get along with others better.  The words are:

Friendliness.   No matter what situation we are faced with, if we are friendly in our response we will do better than with any other human reaction.  This does not mean we should be friends.  There is a big difference to being a friend and being friendly.  Friendliness does NOT mean we should be obsequient, demur or a coward.

Perhaps Winston Churchill’s quote about the civil nature of his declaration of war to Japan sums up the quality of friendliness in the worst circumstances nicely.  His quote was: ““When you have to kill a man, it costs nothing to be polite.”

Compassion.  Compassion allows us to understand.  We do not have to agree or accept. Understanding will help us deal with the situation, acceptable or not.

Happiness.  When events stun, befuddle or mystify, we need to understand that the event is not out of order.  Our thinking  is the fault.  Everything is in perfect order.  Turbulence is simply evolution beyond our understanding.  We fear change because we cannot see the bigger picture.

That’s okay. That’s how it’s always been.  So whatever happens, be happy.  You do not have to be happy about a change or a shift or some event that appears to be a nightmare.  You do not have to like or accept the unfolding.   You can act to resist or alter the change.

Just don’t let the state of affairs become your inner state.  Be happy regardless of what’s going on and what you are doing about it.  Being sad, anxious or depressed will hamper whatever proceeds.  Being happy will always help us to adapt.

Those are three pretty good mantras.  They may seem simplistic, but they are powerful.

Trigger your mantra.  Practice thinking about what’s happening and then think your mantra.  This will train your brain to call up the word or phrase as a habit.  Simply think of a word or phrase that affirms your values.  The three words above are good ones.  I am sure you can think of many more that will help you have better skills.  Start now. Choose a word or words and dwell on them, in silence, every day.


(1) imgarcade.com Tip of the iceberg

(2) www.wsj.com: wall streets endangered species the ivy league jock

(3) www.hsph.harvard.edu/news/press-releases/lack-of-physical-education-in-schools-concerns-parents/

(4)  www.ncbi.nlm.nih.gov: Psychological and social aspects of resilience

(5) www.wsj.com: one habit to make you happier today

See how to create more resilience in your investing.

This quote from Warren Buffet to his shareholders shows the importance of resilience when investing.

Always be liquid. “I have pledged – to you, the rating agencies and myself – to always run Berkshire with more than ample cash. We never want to count on the kindness of strangers in order to meet tomorrow’s obligations. When forced to choose, I will not trade even a night’s sleep for the chance of extra profits.”


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