Wednesday, December 31, 2008

New Year's Irresolution

I hope I am not alone in finding it peculiar that we celebrate the New Year by breaking our own resolutions.

In the spirit of the season, and following a custom that apparently dates to ancient Babylon, many of us draw up a list of New Year's resolutions. Thereby, we mark the new year as an opportunity for self-improvement.

But we are not resolute about keeping them. Usually, we break our resolutions within a week of making them. And we do not give the matter much thought either.

Few people feel even a twinge of embarrassment. It is as though we see the process as part of the larger Bacchanalian indulgence that greets the New Year.

The problem is: New Year's resolutions involve our everyday life... the one that resumes after the hangover is gone.

Since no one really considers them to be binding, why not call these resolutions a wish list, like the lists of the toys we wanted to receive from Santa Claus.

A resolution differs from a wish because you have the power to keep or to break a resolution. You do not have the power to keep or to break the wishes you sent to Santa Claus.

New Year's is celebrated as a time of renewal. Since our calendar places it at the beginning of January, we confer the aegis of the god Janus on it. As you Janus looks both forward and backward at the same time. At New Year's we atone for past errors, and, putting them behind us. resolve to improve ourselves in the future.

Standard resolutions aim at eliminating sins like: smoking, over-eating, arrogance, and sloth. Others point us toward better habits in the future: working harder, learning French, thinking more positively, and learning to do yoga.

As goals, these are admirable. Why are they so difficult to keep?

First, they are imprecise. Second, they are too large. Third, we rarely plan out how we are going to accomplish them.

In effect, our resolutions are glorified wishes. I do not want to be priggish about it, and I do not want to wring the fun out of the holiday, but this practice offers the wrong lesson.

It is a bad idea to act as though your word were a mere wish, an intention that you can breach with impunity.

So, this year I recommend that we all make at least one resolution that we are going to keep. Closing the gap between what we say and what we do would be a great leap forward into character-building.

You can do it by emulating the tortoise, not the hare.

Make your resolutions specific and manageable. You can resolve to do acupuncture to stop smoking. You can vow to join weight watchers or to consult with a nutritionist. You can resolve to join a gym and to buy ten training sessions. You can vow to sign up for French classes or to plan a family trip to Acapulco. And you can resolve to write down three good qualities you see in someone you dislike.

This rule applies to other life situations. Anytime you are starting a project or engaging a new activity, begin with what is manageable. If you have recently been promoted, do not worry about crisis intervention or policy-making. Begin by bringing your wardrobe up to the level of your new job.

Admittedly, this is not sexy. But most people get lost when considering the complexities of large, ill-defined tasks. Making a plan that sets out the steps to achieving a goal is essential to achieving a goal.

The same applies to the greatest problem most people had in 2008: declining portfolio values. According to this rule, do not resolve to get it all back in 2009.

Instead, resolve to take a course on investment analysis, to learn about all of the stock you own, to study the larger financial landscape, and especially, to take small positions before making large commitments.

Sunday, December 28, 2008

You Say You Want a Revolution

In Friday's "Wall Street Journal" Lee Siegel asked why Hollywood hates the suburbs. And why does it hold suburbanites in such utter contempt. Link here.

Siegel was inspired by the new movie version of the Richard Yates novel, "Revolutionary Road."

Several week earlier Christopher Hitchens prepared us for the movie by reviewing the book in the "Atlantic." He found it to be a fascinating glimpse of the brain-dead tedious world of suburbia. Link here.

Hitchens revels in the chance to exercise his creative muscles by trashing American suburbia, a place where spirituality and creativity go to die. In so doing, he is sharing the views of the cognoscenti who have been more than willing to accept this caricature as fact.

Until recently. Now this much maligned band of pioneers, the group who settled the American suburbs after World War II, has been resurrected by Tom Brokaw and dubbed "the greatest generation."

It is good to keep in mind-- as Hitchens does not-- that the generation that settled in the suburbs was the one that suffered through the depression, went to war, and defeat the Axis powers.

Those who returned home chose to buy houses in the suburbs and to commute to jobs in the America's great urban centers.

Think what you will-- and no one should ever accuse Hollywood of consequential thought-- the greatest generation earned the right to make its own lifestyle choice.

But why did artists and intellectuals shower them with contempt? Because their lives did not have enough art. Because they lacked taste.

According to Yates and other countercultural warriors the suburbs are where art goes to die, where the vitality of the human spirit is crushed under the jackboot of conformity. Life in the suburbs had to be devalued because it did not lend itself to drama.

Yates wrote that the suburbs had not been designed "to accommodate tragedy." He added: "A man running down these streets in desperate grief was indecently out of place."

To buy this line you have to accept that tragedy is the truth of the human condition, thus that good cheer, optimism, bright colors, and manicured lawns are a fraud.

If the men of the greatest generation had already seen quite enough tragedy, perhaps they had a right to some good cheer. And besides, as Siegel wrote, in what kind of town would a man running down the street in desperate grief not be out of place?

Siegel is right to say that our failure to question such bizarre notions is a symptom of the extent to which the counterculture has addled our brains.

You probably know the plot of "Revolutionary Road." Frank and April Wheeler move to the suburbs. Their aesthetic sensibility and youthful idealism have not been entirely extinguished so they decide to bring some theater to the place.

The event goes poorly, as it must. April declares that the only solution is to move to the Promised Land, Paris, France. There she can fulfill herself as an actress and Frank can find himself.

In the end, they do not reach the Promised Land.

The year is 1955. Frank Wheeler is a veteran. Should we not recall, even if briefly, that he belonged to the group of brain-dead men who had rescued France from a fate worse than ticky-tacky.

Critics of suburbia were countercultural warriors before their time. Like good Nietzscheans they tried to disparage the free choices other people made. Their task was to trans-value values.

The men who pioneered the suburban way of life had succeeded in Europe because they adhered to values of duty, loyalty, dignity, and honor. Those were the values they brought to their corporate jobs, the better to rebuild the post-war American economy.

The counterculture wants us to see these as disguises for the horrors that were lurking behind every suburban facade: child molestation, spousal abuse, oppression, and madness.

Why did the literati hate the suburbs and hate the values that had won the war and rebuilt America. Perhaps, as Robert Nozick once suggested, it was because the military and corporate ethos enhances the status of people who are neither creative artists nor serious intellectuals.

They hated the suburbs because they loved their own status more.

Friday, December 26, 2008

Does Rehab Work?

'Tis the season... for celebratory self-indulgence. But once you have had your fill of wassail and grog, and once your mind no longer feels like it has been invaded by dancing sugarplums, your thoughts may well turn to rehab.

Therapy may be going out of style, but rehab is all the rage. But, does it work? Is it worth the $20 billion we spend on it? According to the New York Times, the insurance companies and government agencies that are paying the bill are seriously interested in the issue. Link here.

Asking whether rehab works is easier than asking whether therapy works. At least with addiction we know what treatment success looks like: no more alcohol or drugs.

When we get to the techniques used by rehab centers, things are murkier. As with therapy, there is no clarity, no high concept that tells us what rehab is. As with therapy, it seems that rehab is as good as the individual counselor.

The medical basis for rehab is the need to detox. In many cases this requires strict medical supervision in a controlled environment.

But it does not take a month or two to detox. The rest of the stay in rehab is filled with numerous therapeutic techniques, some more valuable than others.

From group therapy to individual therapy rehab is a therapeutic cornucopia. Among the more effective is a cognitive technique that teaches addicts how to tolerate discomfort and to deal with it by doing something other than reaching for some absinthe or an eight-ball.

So far, so good.

The problem with rehab is that it takes place within a controlled environment. As such, it offers scant preparation for dealing with the temptations that will assault the recovered addict once he or she returns to the real world.

A patient named Angella explained it well to the Times. After completing rehab she remained sober for two months. Then she returned to her addiction. "After a while," she said, "you just start missing your friends."

That is why the most effective treatment programs for substance abuse are based in the twelve step programs that began as part of Alcoholics Anonymous and that have now been extended to other forms of recovery.

Rehab takes you out of your life; it gives you a temporary respite. AA reorganizes your life more constructively and more ethically.

Of course, most rehab programs involve AA-type meetings. I suspect that they all encourage their patients to continue going to meetings once they have graduated from rehab.

As everyone knows, AA works. It works for a patient population that therapy has never claimed to treat effectively. It does not always work, and it does not work for everyone. Yet, it works with sufficient consistency to allow us to say that the program, not the person of the counselor, has produced a therapeutic benefit.

AA differs from therapy because it is one thing, and only one thing. Therapy has dozens of different schools and many more different techniques. If therapy is confusion, AA is high concept. No matter where you go to meetings, no matter who your sponsor is, the program is the same.

If you say that people get better no matter what kind of therapy is being practiced, you are saying that patients are improving despite, not because of, therapy.

With AA sobriety is not the goal, as it would be with therapy. It is the price of admission. It is the basis for participation, not a goal that exists at some existential horizon.

In my view AA is not therapy. It more closely resembles coaching. It shows people how to reconstruct their lives, especially to live more ethically. It insists that they be responsible to themselves and to others, that they exercise discipline, strength of character, and good habits.

Where therapists often traffic in the rhetoric of empowerment and self-help, AA tells addicts that they must accept that they are powerless to control their habit. It adds that they can only get well when they allow a higher power to take care of them.

Therapy tells you that you are alone in the universe and that no one else really cares about you. AA tells you that you are never alone and that someone will, if you allow it, take care of you.

AA meetings are communal gatherings. They are not led by an expert, by a man or woman of science offering learned interpretations of anyone's behavior. This encourages self-discipline and respect for others.

Therapy tells people that they must gain insight into why they have problems before they can fully exorcise their demons. AA tells them to fake it till they make it. It tells them to improve their behavior now, not later.

AA works for those who follow the program. It is not about discovering why you drink. You merely have to follow the instructions laid out in the twelve steps. Recovery is something you earn for yourself by working at it in the conduct of your everyday life.

Obviously, psychotherapy has always had issues with AA. First, because it is free; second, because it does not require credentials.

Also, AA has a dubious pedigree. Psychotherapy arose from the lucubrations of great European thinkers like Freud, Jung, and Adler. AA was cobbled together in Akron, Ohio by a couple of drunks names Bill and Bob.

Psychologists and psychiatrists often learn about AA, but they do not spend their time figuring out why twelve step programs works where insights and epiphanies do not. They learn developmental psychology and advanced psychodynamics but spend precious little time studying why it is necessary to make amends for past failures and why a higher power heals something that they can only wave at.

Thursday, December 25, 2008

The Basis of Moral Community

All communities have miscreants. There is no group of human beings where no one ever does wrong, even, at times, grievous wrong.

A community's moral character is put to the test when it is called upon to deal with the evil in its midst. It befalls those who hold moral authority in the community to isolate the contagion in order to protect the good name of the community and its members.

They do it by shaming those whose evil threatens the community's moral fiber.

If they ignore the evil, defend the evildoer, or denounce the outsiders who are condemning him, they fail at the task. They are asserting that they find his actions acceptable or understandable and that he still represents their values.

This immediately throws the community into disrepute. The disrepute stains the character of all its members. Not through any fault of their own, but because they belong to a community that has failed to separate itself from the evil in its midst.

This, to introduce a fine op-ed by Rabbi Marc Gellman about Bernard Madoff. Coming from someone who holds a position of moral authority within the Jewish community it condemns Madoff and banishes him from that community.

Rabbi Gellman's action is morally exemplary. It is a gift that befits the season, and that should serve to recall other leaders in other communities to their moral duty.

Link here.

And I would add a comment by Rabbi David Wolpe of Sinai Temple in Los Angeles. In comments that are similar to my blog post a few days ago Rabbi Wolpe told the New York Times that he did not believe that Madoff could ever make amends: "It is not possible for him to atone for the damage he did, and I don't even think there is a punishment that is commensurate with the crime, for the wreckage of lives he's left behind. The only thing he could do, for the rest of his life, is work for a redemption he could never achieve."

Link to NY Times article here.

Wednesday, December 24, 2008

Peter Schiff on Gold and Money

Peter Schiff, president of Euro Pacific Capital, must count among those who correctly forecast the current financial crisis. In the linked article Schiff offers his outlook for the future of gold and the Amereican dollar. Like Nouriel Roubini, Schiff is decidedly pessimistic about the future. It was easy to dismiss his views when the good times were rolling. It is not so easy to do so now. Link here.

Tuesday, December 23, 2008

"Does Psychotherapy Work?"

For this blog the opening lines of Scott Stossel's review of Jonathan Engel's "American Therapy" are a holiday gift. Link to review here.

Stossel opens his review with a question: "Does psychotherapy work?" He follows with this line: "Depends on what you mean by 'psychotherapy,' and what you mean by 'work.'"

Where Engel concludes that psychotherapy does work, Stossel spends the first part of his review showing that the evidence Engel offers leads to a different conclusion.

The first problem with the question is the infinite variety of therapies. Some forms take years and pretend that insight cures. Some take weeks and focus on counterproductive mental habits. And others involve strange practices that range from primal screams to est training to beating on pillows with sticks.

Since these different therapies have little of nothing in common, the question of whether therapy works must be qualified: which therapy are we talking about?

Next is the question of what it means to "work?" Most studies base their conclusions on interviews where patients can assert their opinion about whether their therapy has helped them.

Is this really a reliable indicator of clinical success? If you go out and interview Tom Cruise and ask him whether scientology works, you will receive a heartfelt, albeit deluded, exposition about how the teachings of L. Ron Hubbard have freed him from the malevolence of Xenu. Would you then conclude that scientology works?

Beyond that, someone who has invested considerable time and money in therapy has a vested interest in believing that it works. Would you take his or her word at face value?

Engel bases his claim that therapy works on the fact that 59% of those who consult a therapist report that they were helped.

To which Stossel replies that 78% of those who consult a clergyman feel that they were helped. Better yet, 77% of those who discussed their problems with a lawyer found something therapeutically beneficial in the experience.

The difference between 59% and 77% is not trivial. Talking it over with a trained therapist is significantly less likely to be helpful than talking it over with a professional who has no training in psychology.

Today most therapists agree that therapy works when the therapist makes a human connection with his or her patient. Since many patients are suffering from feelings of isolation, anomie, and disconnection... then connection would certainly count as therapeutic.

But the data also suggest that professional training tends to make it more difficult for therapists to connect with their patients. Other professionals, even non-professionals, have a much higher level of connection.

Surely, Freudian training, with which I have more than a passing familiarity, teaches people how not to connect with people. In fact, psychoanalysts are taught that it is bad to have anything resembling a human connection with a patient.

Perhaps this is why psychoanalysis has fallen out of favor. The group I used to belong to, the Lacanians, resembles what Engel called: "... a fanatical Essene sect, living apart in the wilderness where they could continue to seek truth in the master's writings."

That is the most extreme case. Yet, Freud continues to influence the profession, and some therapists still believe that connecting with a patient is a technical error. Perhaps this is why you will do better to talk it over with a friend and why people today are turning away from insight-oriented therapy and toward coaching.

As for the question of what works, I recall a comment by Dr. Gail Saltz in a televised interview a month or so ago. A reporter asked Dr. Saltz what people should do to deal with their anxiety over the current financial crisis.

I paraphrase Dr. Saltz's reply: "I shouldn't be telling you this because I am a psychiatrist, but the best and quickest treatment is aerobic exercise."

Since it is the holiday season, let's ignore the implicit notion that a group of professionals might even imagine not telling you what really works, and let us simply add exercise to human connection on the list of what works.

Monday, December 22, 2008

How Did He Fool Them?

For more on the Madoff scheme, especially about the question of how he managed to fool so many people for so long, I recommend the comments by Nobel laureate Gary Becker and prolific Federal Judge Richard Posner, from their blog.
Link to Becker's comments.
Link to Posner's comments.

Sunday, December 21, 2008

Bernard Madoff in the Ninth Circle

If there are greater and lesser degrees of goodness, there must also be greater and lesser degrees of evil.

As people strain to understand the evil of Bernard Madoff, it is clear to most that there must be a special circle in Hell reserved for him.

When we think of supreme evil we often think of serial killers, mass murderers, and genocidal maniacs.

And yet, Dante saw evil differently. Those whom he placed in the ninth circle of Hell, the worst of the worst, are traitors, people who betray a sacred trust.

Those consigned for eternity to live in the mouth of Satan are Judas, Brutus, and Cassius. They all betrayed leaders who symbolized secular and religious community.

Taking a life is one thing; taking many lives is exponentially worse. Yet, destroying the basis for community is worse yet.

From the newspaper, "The Jewish Forward" comes the following judgment of Madoff: "The loss of money and trust has dealt Jewish philanthropy-- a pillar of American philanthropy-- a blow from which it will not recover soon." Another person active in that world commented: "He has savaged Jewish civil society for a decade." Link here.

And an article in "The New York Post" shows that among those who suffered the most from Madoff's perfidy were his closest friends, his intimates. Madoff had no problem preying on the vulnerability of people he knew the best. Link here.

Look at it this way. Can you imagine sitting down to lunch with someone you are defrauding out of his life savings?

We all feel hate and anger; in some situations they are a necessary way to defend ourselves. In others, the heat of passion gets the better of us and we can see ourselves committing evil actions. And yet, who among us can even imagine stooping to the level of depravity required to do what Madoff did?

Perhaps the supreme evil is an evil that is simply unimaginable... to the point where it feels that the person who commits it is not a human being, but a monster.

In this context some writers have commented that Madoff was surely worse than a criminal. At least with a criminal you know what he is and you can take measures to defend yourself. The same applies to your sworn mortal enemies. These people are less evil than Madoff because they never pretend to be anything other than what they are.

Remember that Brutus and Cassius where confidants of Caesar. They owed their exalted positions to Caesar. Judas, as you know, betrayed Christ right after participating in a Passover seder with him.

Some people will recoil at these religious references. They prefer psychiatric categories like psychopath and sociopath.

The problem is: when you introduce a psychiatric label the next question is whether the person is curable.

When it comes to Madoff that is surely not the question. The larger ethical issue is whether he should be forgiven.

In one of the most prominent systems of ethical thought, Christianity, there is one sin that can never be forgiven. That is, blaspheming the Holy Spirit.

Obviously, Christian ethics is about forgiveness of sins. How does it happen that there is a sin that even God cannot forgive?

The theologians have spend some serious time pondering this question. Augustine, for example, declared that blaspheming the Holy Spirit denotes chronic impenitence. A man who is unwilling to repent his sins can never be forgiven. If you are not contrite, if you do not ask for forgiveness, then it cannot be given.

This is consistent with the notion that penitence applies best to people who have committed evil acts in a fit of rage, out of weakness or out of ignorance. When you are not in your right mind you might commit an action that does not represent your character or your virtue.

Can the concept of penitence apply to someone who looked his best friends in the eye, sat down to have lunch with them, and the defrauded them of everything they had?

Should Bernard Madoff be forgiven?

Here, the answer must be negative. If you have seen the clips of Madoff returning home after his court appearance, you have probably noticed a slight, but perceptible, smirk on his face.

That smirk tells us that Madoff feels nothing but contempt for the bonds of trust that he, whether singly or with others, has destroyed.

Saturday, December 20, 2008

Money Makes the World

Thanks to the financial crisis people are become more interested in the way markets function.

Anyone who works to help people deal with the crisis has discovered that it is not sufficient to mull over childhood memories and fantasy life. Professionals dealing with real people who have real problems in the real world has to have something more than a passing understanding about the way markets work.

To grasp this reality we need to know about the circulation of money. It is not an easy or simple topic. And yet, much of what is going on in the economic world today concerns whether the Federal Reserve and the Congress can forestall a deflationary collapse by engineering a wholesale inflation of our currency.

Understanding this reality and the way it is playing itself out in markets is essential to managing your life, your career, and your finances.

Surely, your financial adviser-- or yourself if that is your work-- has a view of the current state of the world and has worked with you to reposition your portfolio in relation to the new reality.

Goals have to be re-examined, too, but a good adviser will also work out a larger view of the markets, where they are, and where they may or may not be in the next few years.

I hesitate to write much about this topic since I am very far from being competent in it. Yet, fortune has provided us with an excellent essay by the estimable James Grant in today's "Wall Street Journal." It is well worth everyone's attention. Link here.

Thursday, December 18, 2008

Paul McHugh on Hysteria

It may be hard to believe, but despite my best efforts there are still some people who have not had enough therapy.

I was reminded of this by an excellent article about hysteria by the eminent psychiatrist, Dr. Paul McHugh, former chairman of the Psychiatry Department at Johns Hopkins. Link here.

Modern psychotherapy began with Freud's work on hysteria. Freud posited that hysterics suffer because they have forgotten a trauma, and thus, that they can be healed by remembering.

To which McHugh replies: "It is remarkable (even breathtaking), to realize that, despite all the changes in theory and practice that Freudian psychoanalysis underwent in the following decades, this basic idea-- heal by remembering-- has never been questioned. It remains today the fundamental concept behind the multiple-personality-disorder and recovered memory crazes."

Once an idea becomes dogma by being wrapped in myth it can live on for a long time, even if it is clinically ineffective.

But why does this treatment fail? McHugh's work offers an explanation.

McHugh begins by explaining that hysteria is mimicry. Hysterics adopt patterns of behavior that look like illness, and that they believe make them ill. They may be mimicking neurological disorders, like fugues and seizures, or they may be mimicking psychological disorders, like multiple personalities.

Hysterics are not consciously faking it. They believe that they are ill. McHugh calls it "a vivid form of self deception."

Hysteria, then, is learned behavior designed to attract the attention of authority figures like physicians or pastors. It develops over time as the hysteric tries on new symptoms and sees whether they attract sufficient attention and concern.

Most hysterics are young women. The authority figures whose attention and care they seek are most often male. It is, as Freud discovered, a game of seduction.

Why do they do it. Most often, McHugh suggests, they are demoralized from failure. Rather than admit that they have failed, they decide that they are ill, that they are not in their right minds. In this way they do not have to take responsibility for their mistakes.

Hysteria is living theatre. Hysterics are notably histrionic. That means, as McHugh shows, that they require an audience that sits quietly and attentively in the dark. A good listener, one who accepts the hysteric's complaints as legal tender, sustains the condition.

In his article McHugh offers several examples of groups of women developing the same set of hysterical symptoms. The witches of Salem and the hysterics in Charcot's clinic all manifested the same problems. And yet, once the controlling authority figures stopped colluding in their production the symptoms largely went away.

Since hysteria is theatre, once the lights go on and the audience leaves, the hysteric is more amenable to reason.

McHugh's most salient point concerns hysterical mimicry. For Freud hysterics were suffering from forgotten traumas, thus from personal experiences that they were refusing to allow into consciousness. Their symptoms were expressions of something intensely intimate that could not be told in a story.

The solution, to many therapists, is to allow patients to recall their repressed memories or to reconstruct their past, and then, to express their unconscious feelings.

Now we can see why it did not work. If hysteria is mimicry and if several hysterics develop the same symptoms, it makes no sense to say that each of them is expressing something intimate and personal.

When Freud tried to tell his hysterical patients that they were expressing forgotten traumas they often reacted with disdain and indifference. They were right to do so. Freud was analyzing the role, not the person.

If the symptoms do not express something hidden deep within the individual psyche, a therapist's efforts to plumb the depths of said psyche cannot possibly resolve the problem.

A therapist's solicitous attention, his quiet, imperturbable listening, and his ability to be drawn into the performance, to take it on its own terms... that is exactly what an audience offers a dramatic performance. Not only will this never cure; it can only aggravate the condition.

Therapy does not cure hysteria because, to the extent that it follows the Freudian template, it is the problem, not the solution.

Tuesday, December 16, 2008

From Free Love to Hooking Up

It is not very far from free love to hooking up. After all, hooking up is giving it away for free.

Unfortunately, giving it away for free does not make you a generous person. Nor does it mean that you place a high value on yourself. Hooking up is not the royal road to self-esteem.

Hooking up is not news. Tom Wolfe offered a sardonic definition at the turn of the millennium: "In the year 2000, in the era of hooking up, 'first base' meant deep kissing ('tonsil hockey'), groping and fondling; 'second base' meant oral sex; 'third base' meant going all the way; and 'home plate' meant learning each other's names."

Even though we have known about hooking up for some time now, people still react strongly to each new article, like the recent one by Charles Blow in the New York Times. Link here.

Older people, like Blow, find it sad that young people no longer date. Younger people feel misunderstood and unfairly judged.

In place of dating young people go out in groups-- girl groups and boy groups. When one young person in one group finds another in another group reasonably attractive they chat a bit and go home together.

Many young women insist that this does not man that they are indulging in random sexual encounters. They say that they are choosing partners from a group of friends. If they were hooking up with people they just met, their reputations would be compromised.

This means that the old morality is more resilient than many young people think.

Hooking up may pretend to be a new ritual, but it simply reverses the order of the old dating ritual. When people dated they went out together, got to know each other, developed an attraction to each other, formed a relationship, and consummated their feelings.

In the anti-ritual of hooking up, first, you have sex, then you get to know each other, then you discover whether you like each other, then you develop a relationship, then you go out on a date.

This anti-ritual is displayed in the popular movie: "Knocked Up." There, a random alcohol-fueled sexual encounter leads to pregnancy, to getting to know each other, to learning to like each other, to developing a relationship, to becoming a responsible parent.

So, the goal of hooking up seems to be identical to the goal of the old dating ritual. Yet, since precious few hook ups lead to anything resembling a relationship, the Hollywood ending feels more like an illusion that women use to rationalize behavior that they are not very proud of.

I suspect that if young women did not believe that hook ups were going to lead to relationships, they would be far more parsimonious about handing out sexual favors.

Feminists used to insist, unimpeachable, that women should not be used as sexual objects. Now, postmodern thinking has persuaded them that if two people agree to use each other for sexual pleasure, then no one is being exploited.

According to this twisted mindset, if everyone agrees that something is true, then it is true.

If hooking up is supposed to achieve the same goal as dating, then we need to understand something about the socially prescribed ritual.

Daring is a venerable ritual that allows people to make meaningful connections before they make larger life commitments. It seems to have originated in the West about a thousand years ago in the practice of courtly love.

That elaborate courtship ritual involved a woman what had been left alone while her crusading husband was fighting the infidels and a teen aged boy who was working at a menial job in her castle.

The romantic attachments of courtly love were, by definition, adulterous. Ostensibly, they were not even consummated.

Romance did not die with the crusades. It morphed into other institutionalized adulterous practices, producing the king's favorites, mistresses, and courtesans. As long as marriage was arranged, love and romance were side shows.

The first crack in the system occurred in England in the seventeenth century. There, for perhaps the first time in human history, women were allowed to choose their mates freely. This required a new ritual, a courtship ritual, that could be engaged by unmarried young people. Borrowing from the well-developed romantic practices, it simply changed the focus of courtship from adultery to marriage.

Evidently, courtship morphed into dating. Both rituals tried to give young people a better basis for choosing a mate. Presumably, this was going to make for better marriages, and enhanced marital fidelity. It would also reduce the sometimes lethal confusion over bloodlines and inheritance.

Dating was also designed to protect young women from being exploited by their families and from being used by men.

Dating required that a young man make a public show of interest and a minimal commitment to a young woman. He had to ask her for a date, pick her up, take her out, pay for her, and finally, to escort her home at a reasonable hour.

When a man followed this ritual he made a public commitment to a woman, presented himself as someone who would care for her and protect her, and made a display of respect for her as a woman.

Young people today find this quaint and objectionable. They reject the notion that women need to be cared for or protected.

Modern women can take care of themselves. They want to be independent and autonomous. They can do anything a man can do, and God help you if you do not agree.

This view has a lot to recommend it. In many areas of human experience it is true. The problem arises when a man and a woman engage in an act of coitus.

Think what you will, they are not engaging in the same act. The emotional investment is different; the oxytocin levels are different; the risks are different; the potential consequences are different.

The dating ritual, having developed over centuries through trial and error, takes this into account. To decide one day that human experience should be ignored because it does not correspond to a trendy idea is a dangerous gambit.

Confucius famously said that people should observe rituals whether they understand them or not. But that requires a respect for the authority of tradition, and young people today have been cured of such respect by the time that they start hooking up.

Why do they hook up? Perhaps because they have to make sense of the ritual on their own. After all, most of the young people who hook up eventually start dating, at around the time that they are ready to settle down.

Sunday, December 14, 2008

Empathically Yours

"Soft skills" may be a misnomer, as I suggested in a recent post, but they are still essential to management and leadership.

To make them more workable we need to redefine them and to remove the errant connotations of softness.

Soft skills are people skills. They are organizational and motivational. They matter because, as I once read, successful executive leadership involves getting other people to do things. Also, to get them to like what they are doing, to work harder at their tasks, and to like the people they are doing it with.

Management and leadership involve getting others to function effectively in a group... whether to study a problem or to implement a policy.

If you do a Google search you will find that all of the soft skills mavens say that the basis of leading, managing, and getting along is... empathy.

But, what exactly is empathy?

If you look at the Wikipedia compilation of the different definitions you will see that they are diverse and confused. Link here.

It is very difficult to teach or to apply a skill when no one seems to know what it really is.

Most coaches know that leadership is not about ordering people around and assuming that when you say jump they will all jump. So they offer empathy as a corrective. For them it means that an executive must understand that his staff members have feelings too.

It is difficult to imagine that a person gains a position of executive leadership without knowing that other people have feelings, but stranger things have happened.

Strictly speaking, empathy means: feeling someone else's feelings. At its root it involves pathos, thus, pity.

But then, do you really believe that an effective executive can lead his team by feeling sorry for them? Or because he feels their pain?

You cannot manage people by declaring that you feel their pain. Most sentient individuals, hearing that someone feels their pain, will respond, correctly, that he does not. The best you can ever do is to feel your own pain.

And what makes you imagine that you can feel the feelings of someone you have very little in common with? Does the grizzled male executive have any real sense of what it feels like to be a twentysomething modern woman?

When someone confesses a painful experience, the best you can usually do is to respond in kind... not by saying that you feel his pain, but by telling of a similar experience.

The question is: is this empathy or are you simply reciprocating, as though you were exchanging gifts. It seems to be more about reciprocity than about fellow feeling.

Worse yet, the term empathy seems to suggest that when someone comes to an executive with a plaintive excuse for why he is chronically late or cannot focus on his work, the executive should feel his pain.

I am sure you know that this is bad management technique. You might forgive the person is he is sufficiently apologetic, but excusing him because you feel his pain will create dissension and drama in the ranks.

Some thinkers have balked at the notion of fellow feeling. It is a bit too soft for their tastes. Their definition suggests that empathy involves putting yourself in someone else's shoes. This means that you should be conscious of the effects your words or actions produce in another person.

I will pass over the fact that putting yourself in someone else's shoes can feel invasive or intrusive. Would it not be better to respect the integrity of the feelings of others?

Nonetheless, being aware of the effects you are evoking in others is a basic conversational skill. When you are talking to another person you should know how to pick up both verbal and nonverbal cues. You should be aware of the way a person words something and the wording that they are avoiding. And you should know how to read facial expressions, physical gestures, and tone of voice. Then you should modulate your conversation accordingly.

As I have been at pains to assert in other blog posts, conversation is not about giving full voice to your feelings or saying whatever comes to mind. It involves establishing a connection with another person by engaging in a reciprocal, and measured, exchange of information, thoughts, and feelings.

Your goal should be to establish something like a harmonious exchange. And this is a better leadership model that imposing your will on another person and then feeling the pain they are feeling for being bossed around.

An effective leader should not lord it over people. But the skills involved go beyond empathy.

First, an effective leader must respect his staff, respect their ideas, and involved them in the deliberative process. Instead of telling them that he feels their pain, he should tell them that he finds something of great value in their ideas or their performance. Not so much because because he has invaded their mental space but because he wants them to be involved in the process.

Making too much of empathy can lead us astray in another way. If your team is competing against another team you certainly do not want your players to empathize with their opponents.

If you want your team to be fiercely competitive, it is not a great idea to have them learn to shower the world with empathy.

How can you do this? Simply, by going beyond empathy and recognizing that the true basis for effective leadership is setting a good example.

Thursday, December 11, 2008

Learning to Win, Part 2

What motivates successful people? Why do some people seem driven to succeed while others content themselves with suboptimal performance?

The conventional wisdom answers that success comes to those who really want it, who want it more than others, who want it really, really badly.

This implies that the path to success must involve strengthening your desire... almost to the point of becoming obsessed.

This theory says that if the man does not stop drinking it is because he does not really want to. And it declares that if the child is doing poorly it is because her parents did not really want her. Finally, it tells us that the player lost the match because he did not really want to win.

The other part of this theory tells us that if you cannot succeed as a florist then that means that your heart's desire has nothing to do with flowers. This implies that once you discover your true desire to throw pots success will arrive on angel wings.

This conventional wisdom infests our therapy culture. It was effectively countered by Brett Steenbarger in a post yesterday on turning goals into consistent habits. Link here.

Steenberger's point, if I may paraphrase, is that success does not come to people who want to win; it comes to people who hate to lose.

Winners do not lust after the emoluments of success. What really motivates them is the taste of failure. Having found failure intolerable they have vowed to do whatever it takes not to experience it again.

The emotional matrix of this motivation is shame. Shame accompanies defeat and success comes to those who will do what it takes to avoid shame.

The most significant problem with the emotional reaction to failure is that people do not feel badly enough. They shrug off failure as something that happens in life. They do not denounce it as something that they should never again have to feel.

As Steenbarger suggests, desiring the benefits of success is a poor motivator. When you are working hard because you want to own a yacht , your motivation to work will subside the moment you acquire one.

If, however, you are motivated by a fear of failure, that prospect is always lurking. Worse yet, the more you have the more you stand to lose.

This is not just about learning to win. It also concerns what causes people to make important changes in their lives. I suggested in my book "Saving Face' that shame is a primary motivator of significant and substantial change.

Steenbarger argues the same point. In his terms, we change when we have to, not when we want to. For those who have made a career out of saying that no one can change without really wanting to, this is a sobering corrective.

Alcoholics stop drinking when they find themselves in the real or psychological gutter. Only when the pain becomes too great and the alcohol fails to palliate it are they motivated to do what it takes to avoid going back.

Steenbarger reminds us that alcoholics go to AA meetings for two reasons. First, for the social connections with their fellows; and second, because listening to the bad experiences of others provides a constant reminder of how far they might fall.

It is not about what you want to do; it's about what you have to do. It's not about aesthetics, but about ethics. The strongest positive motivation does not come from appetite, but from duty.

[Note: My first post on "Learning to Win" is dated August 30.]

Trading Psychology, Market Bubbles, and Crashes

In the new "Atlantic Monthly" Virginia Postrel has an excellent article on the psychology of trading markets, the way bubbles are formed, and how they lead to crashes. Link here.

Tuesday, December 9, 2008

Soft Skills

Beyond your qualifications for the job, beyond your technical wizardry... lies the realm of soft skills.

How many times have you heard that someone of exemplary brilliance was not hired or promoted because he or she was difficult to get along with, not a team player, too rude for words, or had bad table manners.

A person who is hostile, not conciliatory; who is in your face, not saving face. A person who browbeats colleagues, fails to speak up to defend his or her ideas, cannot make small talk, refuses to negotiate, and is cold, detached, and indifferent to other people.

Such a person lacks soft skills, or better, lacks social skills.

Everyone accepts that we need to develop our soft skills. Yet, I suspect that one reason it is so difficult to persuade people of their importance is that they are called "soft."

Developing your soft skills is hard work. It requires strength of character, courage, fortitude, and perseverance. Do any of these qualities apply to someone who is "soft?"

Normally, businesses seek people who are tough competitors, who are sufficiently confident to work through difficulties, who are courageous enough to take a stand, and who are good teammates.

All of which might apply to a football player or a first lieutenant. The problem is: neither football teams nor armies value softness.

This is not a trivial point. Many of what are called "soft skills" involve rhetoric: the way you word a thought to make it persuasive. Shouldn't the soft skills mavens know better than to label their field with a term that is less likely to motivate people?

Rhetoric may concern the way you word your thoughts to persuade an audience-- say, a jury-- or it may involve persuading your boss or your staff to undertake a new project.

It is one thing to stand up at a meeting and say: We must do things this way. Quite another is say: I recommend the following course of action. With your forbearance I would like to explain why.

It is easy and lazy to say whatever comes to mind, regardless of the occasion. And it is easy and lazy to express your feelings willy-nilly, regardless of who you are, where your are, with whom you are.

It takes discipline to master soft skills, and discipline is the enemy of unbridled expression.

To improve your soft skills, start by thinking before you speak. Start by thinking of five different ways to articulate the same thought or feeling. Then think about which one best reflects who you are, how you want others to see you, whom you are speaking to, and what you are trying to accomplish.

In a business context who you are is your title, your place in the organization, your duties, and your responsibilities. You can speak like you are in charge if you are in charge; otherwise you are going to sound arrogant and pretentious.

You should speak differently to those above you and to those below you. You show more deference to someone who signs your paycheck than to someone who delivers the mail. That does not mean that you should ever disrespect the delivery person. It means that you need not defer to him or her.

You should measure your words if you want your idea to be adopted or to be implemented effectively. Leadership is not about shooting your mouth off and yelling at people who do not obey.

If you draw more attention to yourself than to your ideas you have not worked hard enough on your soft skills.

Monday, December 8, 2008

The Crash of '08

To begin, here are two links on how the financial world became undone, one from journalist Michael Lewis (link here), and another from Harvard professor Niall Ferguson. Link here.

Some other articles show the effect the crash is having on everyday life. Call it the human dimension of the crisis.

From Great Britain comes a portrait of the "toxic wife." While New York City seems to have invented the toxic bachelor, London seems to have cornered the market in toxic wives. Link here.

A toxic wife does not stay in her marriage for the children; she is in it solely for the money. Her worst trauma occurs when her husband cuts up her black American Express card.

The current crisis has sent toxic wives scurrying to divorce lawyers. They want to ditch their less solvent current husbands and to find someone new who can support their extravagance.

Frankly, the article reads like a caricature. If it had suggested that New York women are in this situation, I would seriously doubt it. Yet, it describes a condition that apparently pertains in London, so who am I to judge. Besides, the fact that it is a caricature does not prevent it from being true.

In the most recent "Vanity Fair" we can also read Michael Shnayerson's compelling account of how the crash is playing itself out in the lives of some of Wall Street's former masters of the universe. I have occasionally blogged about this topic, and was happy to read Shnayerson's more comprehensive account. Link here.

Also from Great Britain, on a topic I have blogged about, we read an analysis of the pending crash in the contemporary art market. Link here. For my own view, follow the links to the left of this page.

In hindsight we always recognize the signs of manias. We all say today that we would have known that you should not mortgage your house to buy a tulip bulb.

And yet, many of us thought that spending $8,000,000 for a dead fish was normal because a group of very intelligent people had decided that it was art. Why ever would anyone believe that brilliant people cannot be swept up in manias? In any event, the dead fish was put on display in the Metropolitan Museum of Art in New York.

To echo Jim Rogers, it was not normal... and it was not great art.

To look at the bright side, I link Bill Fleckenstein's column, where he predicts that China will come out of the current recession faster than many other countries. Among the reasons, Fleckenstein says that China today reminds him of the United States in the 1950s. Link here.

For those who thought that the 1050s were a cultural wasteland, where entrenched retrograde values hampered the flight of the human spirit, Fleckenstein's comment helps to put the value of values in a larger perspective.

Sunday, December 7, 2008

Queuing Up

On November 28 a Wal Mart worker in Valley Stream, New York was trampled to death by "consumers gone wild."

The event was so horrifying that it captured the public imagination, eliciting numerous interpretations. Among the best was Kirsten Powers' suggestion that the incident bespoke a crisis in American civility. Link here.

As I was reading her article I recalled that someone somewhere once stated that the British had invented civilization when they learned to stand in line and wait their turn. Thus, to queue up.

I could not find the original quote, but I did find the following in a website called "OK in UK." Offering advice to tourists visiting Britain, the site said:

"To many Brits a queue is simply what defines a civilization, and anyone who attempts to push their way to the front of the queue is made to feel about as welcome as a fox in a chicken coop. In fact, there is no faster way to bring a Brit to the brink of apoplectic rage than by queue jumping."

In a civilized world people wait their turn. At Wal Mart, on black Friday, shoppers are so drunk at the chance, as Powers says, to get their hands on some "discounted lip gloss," that they trample anyone who gets in their way.

How did we get to this point?

Powers quotes Dr. Keith Ablow's view that people today feel that they should live their lives as though they were television personalities and fictional characters.

Surely, Dr. Ablow is correct. This is a new cultural phenomenon. It is reflected in posts I have written on the chaos in the dating scene and the do-it-yourself-ism on Wall Street.

Given the absence of a coherent culture, people forge a semblance of human connection by creating drama. They find it repressive to show respect and consideration for others. Besides, politeness slows the narrative.

Powers takes it a step further when she suggests that our culture has undermined civility by glorifying incivility.

She places blame with the reality shows that glorify rude and shameless behavior. Whether it is Jerry Springer or "The Bad Girls Club," if you are willing to make a fool of yourself you will have a better chance to get on television. Shamelessness sells.

But this did not come from the moon. We owe some of it to the therapy culture. If you follow the precepts laid down by the therapy culture you ought to overcome civility and become a fictional character or a celebrity.

Didn't Freud say that we were all unconsciously modeling ourselves on the character of Oedipus? And didn't he write the standard denunciation of civilized morality in "Civilization and its Discontents?" Who would have imagined that people would actually make it all into rules to live by?

The therapy culture has told people that they can recreate themselves and transform the narrative of their lives. To do so, it helps to follow your impulses and express your most intense emotions.

If you follow these rules your life will become a permanent psychodrama. I guarantee it. Even a Keith Ablow has understood the problem and is offering his patients the correct counsel, the therapy culture is pushing hard in the opposite direction.

Here I want to add that the best way to glorify incivility is to devalue moderation by seeing everything in extreme terms.

Television dramas advance the therapy culture by offering thinly disguised moral lessons. How often do they show a young person who has such strong feelings about a great cause that he is relieved of the requirement to be civil?

How many times have you seen a passionate young person working himself into a lather while arguing a motion in a courtroom. The geriatric judge is horrified at this display of raw emotion and wants to punish the breach of decorum.

Yet, the issues are so vital-- whether they be life or death, the survival of the planet, or the existence of constitutional government-- that he is eventually vindicated and the judge is shown to be an old fool.

Once you accept that extreme situations require incivility, you need but make every problem into a life or death matter. Cutting down trees is serial killing; Roe v. Wade unleashed a holocaust; people who refuse to believe in global warming are Nazis.

Where did this extremist alarmism originate? In recent history, incivility first became glorified during the 1960s with the anti-war movement and the counterculture.

If you are passionate about your cause, civil discourse and moderation were ploys to cover up the monstrosity of the war.

And this was not merely the province of the radical left. In 1964 the Republican presidential candidate, Barry Goldwater declaimed: "Extremism in the defense of liberty is no vice; and moderation in the pursuit of justice is no virtue."

When it comes to political discourse, the clearest sign of incivility occurs when people declare that their cause is so true, their beliefs so righteous, their passion so pure and strong... that people who differ must be silenced.

Incivility means disrespecting people who disagree with you. It is the enemy of the free trade in ideas. It promotes groupthink to the point of shunning people who dare to differ. And it often does it under the banner of freedom.

If everyone you know thinks the same thing, then you should not consider yourselves to be a band of free thinkers.

Extremes exist. They are the exception, not the rule. A culture that makes them the rule will produce more and more of them... to validate itself.

Friday, December 5, 2008

And You Think You Have Problems

Consider the case of the poor sod-- that's British slang for a 48 year old male senior manager-- who wrote to Lucy Kellaway of the "Financial Times" to ask a burning question: Does he have to go to the office Christmas party? Link here.

If he sounds like a whiny child asking whether he really has to go to school, then you have captured the tone of the query.

As it happens, this man made a solemn vow to himself last year, to the effect that he would "never again" attend one of these celebrations. And he would have happily kept his word, were it not for the recession.

I, for one, would tend to place considerable value on sworn vows, even those made only to oneself. Yet, a vow made in a fit of pique should, if possible, be discarded. That is what his mind is beginning to tell him. Potential unemployment, like pain, focuses the mind.

As you might expect, many of those who have offered him advice on the "Financial Times" website have made it clear that he has a bad attitude toward his company and its culture. If he advertises his sour disposition and general disrespect in his everyday work, then his job is probably in some danger... recession or no.

Besides, given the fact that he has a job and that his company is among the few still holding Christmas parties, he should be able to find good reason to rejoice. That is what a rational person would be thinking.

Our sod, however, recalls last year's party as an unspeakable trauma, to the point where this year's party is "the most dreaded event of the social year."

Last year he worked himself into high dudgeon over the "fake camaraderie," the "excessive alcohol consumption," and, as though that were not enough, "the hideous vulgarity of it all."

Do you feel his pain? If not, let's make a stab at empathy. Imagine last year's party, a raucous event that was bubbling over with the raw energy of youthful exuberance. And let us imagine that our 48 year old sod was feeling somewhat out of it. One person's "hideous vulgarity" is another, probably, younger person's idea of a good time.

A normally-constituted older person would accept the reality of his advancing age and would arrive early and leave before the high jinks shifted into higher gear.

Our sod did not think in these terms. He responded to the festivities, one imagines, by oozing the kind of unctuousness that is going to alienate everyone in the room.

He had not considered that it is possible to act your age and still to have a good time among people who are half your age.

A Christmas party, like many other events that count as crucial to the creation of a strong corporate culture, matters far more in the breach than in the observance.

In many ways minor obligations are more telling than major ones. It's like the man who is having a job interview over lunch. He is thoroughly ingratiating to his potential future colleagues, but is extremely rude to the waiter. If you are the interviewer you must hold the rudeness against him. It tells you that his charm is unreal.

Going to a Christmas party requires so little effort that our sod will look very bad indeed if he blows it off. He will be telling his colleagues that he does not want to celebrate the end of the year with them. They will probably be able to read in his tone of voice or facial expressions that he considers them to be vulgar, pretentious, and empty.

It is not just a question of holding on to a job. It is a question of doing a job well and effectively in a difficulty business environment. At times like these people should do everything in their power to ensure the effective function of the company and the good morale of the staff. One essential step in that direction is showing up at a party that you may have outgrown. It does not feel like too great a sacrifice to make for the good of the team.

Skipping the party with a lame excuse is very bad form. It will likely grant you many unhappy returns of the day.

Thursday, December 4, 2008

Zizek on Violence, Part 2

On August 5 I wrote a long post on the Slovenian philosopher Slavoj Zizek. For those who wish to read a more complete debunking of his horrific thought, I highly recommend Adam Kirsch's synoptic review in "The New Republic." Link here.

Kirsch has written a truly great article, going much further than I did in revealing the depravity of Zizek's thought. For those who think this is trivial, I would recall that Zizek is something of a cult figure, taken very seriously by academics. Perhaps now they will think twice before forcing their gullible students to accept Zizek as a great thinker worthy of respect... but I have my doubts.

Wednesday, December 3, 2008

Had Enough Change?

In the last election the majority voted for: "change we can believe in." By now many are discovering the value of the old saying: Be careful what you wish for....

As it happens, change has arrived. Over the past three months our nation has undergone a sea change. It is a lot more change than anyone bargained for.

You can see signs of change all around you. Coaches and therapists used to have clients who stated that they did not understand why, with all the money they had, they were not happy.

Today, no one sets off in pursuit of happiness. No one even raises the issue. As worthy as that goal was, it has gone the way of the bull market. If my own practice is any indication, it has been replaced by coping strategies, survival skills, and stress management. People whose material condition has drastically changed must first reorganize their lives.

In the old days people were told to be optimistic, to maintain a positive attitude. They were wondering how they could get a bigger raise or bonus, how they could achieve peak performance, and what (or whom) they could buy with all of their riches.

They are their friends were succeeding beyond their imagination, and they were facing the kinds of choices that befall the wealthy.

Now, people wonder whether they will have jobs tomorrow. If they are out of work they wonder about whether they should take a job that offers a cut in salary. If they are still employed they want to know how best to go about firing loyal and competent staff members. Instead of having to decide which co-op to bid on, they are wondering about how to negotiate a lower rent.

Optimism has gone away because it does not reflect current reality. If you are still using the buzzwords of the now-departed gilded age, you are showing that you have lost touch with reality.

It is offensive to offer a happy face when people have lost fortunes, careers, and lifestyles. There are times when commiserating is the correct approach.

And yet, receiving commiseration should never become a way of life. Feeling sorry for yourself is not a stepping stone on the road to recovery.

The first step to recovery is discovering that the gilded age was a fiction. Here is the way Alexandra Lebenthal described the new reality of John and Mimi Cotter: "In the midst of the continuing body count of jobs lost and houses in foreclosure, Mimi and John's extravagant lifestyle is beginning to seem like a world that never really existed. The idea of buying a second apartment at a cost of more than the annual income of entire towns... just to showcase one's art or to prevent the irritation of a neighboring renovation, seems so overly indulgent as to border on silly. Sadder still is that twenty good years in the lives of two people amounted to a bubble inflated life devoid [of] any real sense of values, let alone love and partnership."

Read the full article here.

Jim Rogers said it was not normal; Alexandra Lebenthal says it was not real. They are both right.

What went wrong? Simply put, the Cotters were living a dream; they had completely lost touch with the everyday realities that are a staple of the human condition.

But they were not just living any old dream. They were living a philosopher's dream. They have joined a class of superior beings who did not have to worry about mundane realities like negotiating difficult situations or choosing between this or that car.

They did not believe in give and take. They just took. Therefore they did not bother to solve problems or to connect with people through common enterprise. They threw money around and hoped that the problems would go away. And they could get away with rude and disrespectful behavior because they had so much money that no one could afford to call them on it.

Strangely, bankers and money managers were living like celebrities. Many were genuinely concerned about how often they were mentioned and pictured in the tabloid press. Some even had their own publicists. They did not understand that when a hedge fund manager starts living like a celebrity he is degrading himself.

Like celebrities, these superior beings had overcome repression. They did what they wanted when they wanted with whom they wanted. Other people had to choose; they could have it all.

Having overcome the constraints and the discipline that add value to the lives of normal people, they could follow their bliss... off of the cliff.

If anything, the lesson of the current debacle is that there is a reality out there, that universal values exist, and that if you insist on defying them, you will, eventually pay a very high price.

Monday, December 1, 2008

Problem Solving

Several people have asked me to elaborate on the last post, so here goes.

People were mostly interested in the notion that trauma makes everything feel personal. Surely, what applies to trauma also applies to failure and loss.

Trauma makes people feel alone and isolated, lacking in resources. As the old saying goes: "Success has many fathers; failure is an orphan."

When everything starts feeling personal we ask questions like: Why did this happen to me? What is wrong with me?

Trauma makes us turn away from problems. It tells us not to attack the problem but to attack ourselves. If that does not work, it directs us to attack others, beginning with those who are trying to help us to escape the trauma.

Trauma and failure convince us that we cannot trust anyone. We withdraw into our mental sanctum and feel overwhelmed by the anguish. Sometimes we even imagine that if we get fully in touch with the pain, even allowing it to take us over, then it will exhaust itself and we will achieve catharsis.

We might tell ourselves that we will eventually return to the fray, but that currently we are too wounded to compete. We may trot out an overused metaphor and say that by withdrawing we are taking the time to heal.

When we follow this strategy we are doing the trauma's work. We are allowing it to continue to influence our lives. We are making a single failure into a meaningful event, one that tells the world who we are.

Of course, the way to overcome feelings of failure is to start solving problems, the sooner the better.

The trauma has another idea. It wants to control your mind. It will tell you that you will never succeed, that it is too soon, that you are wasting your time trying, and you should get in touch with your feelings and heal your soul. Then, presumably, the world will follow your soul's lead and the sun will shine on all your endeavors.

If you believe that what happens in the world is merely an enactment of an inner mental conflict, then you can change the world by resolving your mental conflicts.

The trouble is: this new healed soul is not going to be solving any problems. No one even suggests as much. What it really wants is to express itself, to create a work of art.

Yet, this theory, which saturates the therapy culture, misrepresents art. Wordsworth notwithstanding the artist's work is not a spontaneous overflow of powerful emotion. It is work. It is disciplined and self-controlled; it engages itself in constant problem-solving. Art does not reward laziness and inattention.

Art is in the details. And you do not get the details right, whether they concern a dab of paint or the curve of a line or the color palette... without very hard work. Each of the artist's gestures is like a move in a game; it addresses and solves a problem.

And think about this. We are so enthralled by our vision of art as an expression of the soul that when we think about the artistic process we often ignore the model.

Artists learn to draw by trying to reproduce, even to mimic, the model's form. They develop their art by focusing on the model, not on their own state of mind.

It is hard work and requires a scrupulous attention to detail. Each brush stroke, each line, each word and sentence... receives the benefit of the artist's focus. How to draw a line that renders a curve is a problem to be solved.

The artist succeeds to the extent that he can get out of himself.

And this is even more true when he confronts that other, often neglected, aspect of the creative process: the moment when he steps back from his creation and looks at it through someone else's eyes.

A great artist, like a great writer, is a great editor. The ability to set aside the memory of the mental state that produced the work and to give it a cold objective appraisal is rare indeed.

It is rare because the disparity between the great feelings you had when you were painting or writing and the mediocre quality of your first efforts produces its own anguish, its own sense of failure.

If an artist is captivated by the feelings he felt while he was working he will preaching to the converted. His work will never break outside the very small circle of those to whom his feelings are relevant.

This reflection gives us an insight into how best to solve a problem.

First, choose a model, a situation where someone, perhaps even you, solved a similar problem. Examine the way it was done, focus on the details of the actions that took place. And look especially at the small stuff-- a gracious gesture, a kind remark, an extra effort-- and ask how they facilitated the resolution of the problem.

Second, look at your problem as though it were someone else's. Compare its current state to your model's. Ask yourself how you would advise someone else to deal with the same problem.

Do you need to add a dab of red here or there? Or should you introduce a new form or a new character into the scene? Or does it need a more extensive reworking?

Perhaps the situation is in such bad shape that it is not worth salvaging. If there is no way your new effort is going to achieve something like a payoff, you might do best to walk away. In finance it is called Gresham's law: don't throw good money after bad.

Finally, never expect that your current efforts are going to be an exact replica of the model you have chosen. Every solution is going to have its own integrity; and it cannot have any integrity if you try to repeat exactly what happened in the situation are using as a model.

Friday, November 28, 2008


A truism is an adage you have to apologize for. How can you imagine that your friend does not know something that is self-evidently true and that you first heard in the fourth grade?

At times, a truism is an adage that has been worn out from overuse. Everyone knows it, everyone accepts it, but... so what! Almost by definition, truisms and adages are a lot easier said than done.

Of course, it doesn't matter whether you know it and accept it. What matters with an adage is whether you do as it says.

Everyone knows Ben Franklin's adage: a penny saved is a penny earned. Some people even understand it's meaning: that saving money is work. And yet, being thrifty is a different challenge.

If you tell a profligate spender that a penny saved is a penny earned, he will feel insulted. What kind of friend forces you to face a character flaw.

Our therapy culture has taught us to take offense when someone tells us what to do. This has helped to foster disobedience and indiscipline. Thus, our therapy-addled minds will not look kindly on this Franklin adage: "He who won't be counseled can't be helped."

Obviously, counsel means advise. Franklin is saying that a person who cannot take advice cannot be helped. And yet, psychotherapy, at least since Freud, has insisted that therapists should never offer advice, lest the patient begin to doubt that he or she is an independent, autonomous free spirit.

Therapists have been teaching their patients not to follow advice. It prefers insight to counsel even if-- following Franklin-- this means that it is not in the business of helping people.

Beyond therapy lies management. In management you often tell people what to do and you expect that they will do what you tell them. This will sound like a truism, because it is.

The other day I was reading a review of a book about management theory and found the reviewer apologizing for offering a sampling of the "truisms" that were dotted through the book. Link here.

Management theory is full of adages and truisms: first, because managers have to make themselves understood, and second, because they do not have the luxury of wallowing in insights. The problem with management is implementation: how well things get done.

The book in question is Umesh Ramakrishnan's "There's No Elevator to the Top." Among the truisms the reviewer offered is this: "Work hard at what's in front of you. Make sure you succeed at the task you are given rather than waste time plotting your next move."

This means that you should not rush. As the old saying went: haste makes waste. Being anxious to get to the next task will make you do the current job poorly.

We can make this sound more pithy and even Zen-like: Focus on the job you are focusing on.

The principle behind the adage comes from the playing fiend. It means: don't take your eye off the ball until it is in your hands or glove.

Even if you only watch sports occasionally, you have heard an announcer say that the shortstop bobbled the ball because he started to throw it before he had caught it.

Or else, think of the football team that is playing a weak opponent this Sunday and a strong opponent next Sunday. If it looks through this week's game to next weeks it will be unfocused and will risk being upset.

This is not an injunction to live in the present; it is telling you to do one thing at a time. Being focused on this week's project does not mean that you have not made any plans for the future.

I have already written some thoughts about how to gain focus. See my post: The Eye of the Tiger from 6/20/08.

Here I want to extend my remarks by picking up by a suggestion offered by Ramakrishnan. His advice: be a team player. Everyone knows what this means. You are not going to feel that it is an epiphany.

More specifically, he is saying that when your idea has been rejected you need not only to work on the plan that was accepted, but to do everything in your power to ensure that it succeeds.

Why is this worth stating at all? Because when your idea is rejected you might well take it as a personal affront. After all, it is a trauma, even if only a mini-trauma. And we know that when you have been traumatized everything feels personal.

The truism is telling us that one way to overcome the pain of trauma is to throw ourselves into teamwork. It tells us not to question, not to complain, not to introspect, and not to feel sorry for ourselves. If you indulge any of those habits you will become what Franklin would have called... lazy.

Acting as a loyal and reliable member of a team will enhance your ability to focus on the task at hand.

Sometimes adages try to offend us, to shake us out of complacency, to show us our failings.

This one refers to good sense, by which I think Franklin is referring to sound judgment: "Good sense is a thing few have, all need, and none think they want."

Tuesday, November 25, 2008

Buy and What?

Until recently investors had been lulled into complacency by a mantra. They were convinced that the best approach to investing was to buy and hold.

Market analysts used sophisticated charts of past performance to demonstrate that someone who had chosen to weather bear markets had always been bailed out by the ensuing bull markets.

Yet, this analysis was based on the idea that the past will necessarily repeat itself. And this, need I say, is far from guaranteed.

We are assuming, as Keynes wrote, that "the existing state of affairs will continue indefinitely, except in so far as we have reason to expect a change."

Those who were recommending buy-and-hold always factored in the worst that we have ever seen, the Great Depression. They concluded that if it was alright to hold through the depression, it was always right to buy and hold. (For a more detailed explication of Keynes' view, see Paul McCulley's article here.

For now it appears that buy and hold means buy and hold on for dear life.

Take the mutual fund that had racked up year after year of solid and impressive performance, Bill Miller's Legg Mason Value Fund. What could be safer?

Yet, the current market collapse has no spared the fund. In fact, it has erased all of the gains of the past years and then some. Over the past twelve months, the fund is down 63% Over the past five years the fund is down 14%.

Had we given the mantra some thought, we would have concluded that it was too good to be true. It makes you feel that the market is a parent who will always take care of you. It makes you feel like a privileged heir: someone who can get rich by doing nothing.

The buy and hold strategy seemed to suggest that less work was better, that inactive management was better than the more active kind, and that you could get rich by not working.

If the markets are in the business of taking care of us, whatever they take away they will give back many times over. By taking things away they are testing our faith. It is almost as though buy-and-hold was based on the notion of a providential faith that would offer an eternal reward for all of our current sacrifices.

Just as markets move from excessive optimism to excessive pessimism, so do investor attitudes. Nowadays those who have abandoned all hope that the market will ever make them whole again might start believing that the market is in the business of destroying us.

Some believe that the market is an instrument of divine justice. It is punishing people for their capitalistic excesses. Others believe that it was all a fraud to begin with. The market was setting people up, raising their hopes and aspirations... waiting for the chance to crush them underfoot.

Both stories are attempts to deal with a trauma. When people have been traumatized they try to make the trauma make sense by placing it within a narrative. The narrative is like a bridge loan; it is supposed to get you from here to there; to tide you over until the old routines have been re-established. It is not a place where you should put down roots and set up a new life.

The risk is that people take the new story of the crash for the truth about markets. Of course, some will do just that. They might conclude that they should never buy another stock. Or they might believe that they can only restore the old order by enhancing their spiritual virtue. Others might decide that individuals should no longer be allowed to direct their own accounts.

This last sounds the strangest, but keep in mind that the government of Argentina decided a few months ago to confiscate private pensions, on the grounds that individual citizens are not competent to direct them.

Sunday, November 23, 2008

Jim Rogers: The Grandmaster

Prophecy is an inexact science. You can know what happened last month with a lot more certainty than you know what will happen next month. Which is why so many people spend so much time mired in the past.

The past is not prologue, but it can provide lessons. If you are trying to deal with a problem, you can look to the past to find analogous situations, identify different actions taken, and weigh the outcomes.

This kind of exercise is at the core of an effective coaching practice.

In some ways it's like playing chess.

when you are considering a move in chess you must consider your opponent's possible counter-moves. Then you must consider the moves you can make to counter those counter-moves. And so on.

Grandmasters are the ones who think furthest into the future. They quickly think beyond the immediate because they can see the largest number of moves and counter-moves.

The grandmaster uses experience to train his mind. Experience has taught him what does and does not work. He can assess moves and outcomes far more rapidly than lesser players.

When the grandmaster is playing the game he looks toward the future. He knows that looking backward is not going to do him any more good than it did Orpheus.

A grandmaster need not be a person. In business the "person" who can see the farthest into the future with the greatest accuracy is the financial markets.

The markets represent the collective wisdom of the investing class. Everyone has the right to case a ballot in an election, but the investing class can also vote with its money.

The markets are not a democratic institution. Many people do not vote in the stock market and the people who do vote do not have an equal number of votes.

More successful people have more votes than less successful people; they have more capital and more credit at their disposal.

Obviously, the collective opinion of a group of people is not infallible. The market has, as people like to say, predicted eight of the last five recessions.

The future is not predetermined. Government and personal actions can steer it in one direction or another. They may forestall calamity, hasten its arrival, or delay recovery. How we deal with the current crisis will make the future brighter or darker. Given the damage done already, we can say with some confidence that we are not heading to a bright new morning.

In chess, as in bridge, you have to be a great player to understand another great player's moves. With some sports you can be a mere fan and know the difference between great and mediocre plays. When you are dealing with a grandmaster like the stock market, only the best players really know what it is saying.

Jim Rogers is an investing grandmaster. He does not just move his money around; he moves himself and his family around too.

A year or so ago Rogers sold his townhouse on the Upper West Side and moved his family to Singapore. His move was vote of no confidence in the United States and the American dollar.

Here is some of what he said at the time, in December 2007: "I am still short Citigroup. I'm still short Fannie Mae. And I just increased my short positions on investment banks last week because that is where the excesses have been in the United States economy.... You see 29 year-old kids making $10 million or $20 million a year and thinking: 'This is the way the world is. This is normal.' Well, it's not normal."

What would you give for having put on that trade a year ago?

Rogers often comes to mind when people in my practice address this question: Is New York over? The question has not yet reached the cover of the magazine that bears the city's name, but it is certainly worth consideration.

If the dollar losing its status as reserve currency, this will make the financial services industry a shadow of itself. If that happens, what hope is there for the real estate market, the retailing business, restaurants, newspapers, and government services?

The second question people are asking is this: Is Asia the future. So said a report last week from the National Intelligence Council. Link here.

Jim Rogers has long since thought so. Right now the signs point in that direction. For now we will wait for the turbulence to pass before we will know what the future will look like.

Grandmasters at the investing game are, however, already taking their positions. When you learn to look through storms you will be better prepared to make decisions before everyone else. And as Rogers suggests, it is not just about where you put your money; it is also about where you put yourself and your family.