Losses Hurt More Than Gains Help

by Adam Taggart

As biological organisms, humans are motivated by pain and pleasure.

But interestingly, while we tend to think of these as equal motivators, they aren’t. We humans are wired to be more risk averse than pleasure-seeking. As the works of Nobel recipient Daniel Kahneman explained:

Humans may be hardwired to be loss averse due to asymmetric evolutionary pressure on gains and losses. For an organism operating close to the edge, the loss of a day’s food could amount to death, while the gain of an extra days food could lead to increased comfort but (unless it could be costlessly stored) would not lead to a corresponding increase in life expectancy.

And through the related findings of Prospect Theory, we actually know how much more we hate losses than we like gains. About twice as much:

The short video below uses these insights to deliver a simple message: In today’s over-inflated, over-leveraged, over-manipulated markets, why on earth would a rational person not be prioritizing protecting their financial wealth?

Given the outsized risks, as well as our natural programming to feel losses more severely, pursuing incremental gains at this point is downright dangerous if one doesn’t already have a contingency plan in place for a market downturn.

While most PeakProsperity.com readers already appreciate this message, there are many people out there who are still simply following the herd. We created this video for each of you to share with anyone you know who might benefit from a brief but direct “wake up call”. Please take a moment to share it, and let us know any feedback you receive.

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Chris Martenson

Build understanding, encourage small actions, then align with solutions. Many people have asked us, "Where are the large-scale solutions to all the problems you have described?" and "What should we do as a nation to avoid the seemingly inevitable consequences of this fiat money system?" We believe that we must reach a critical mass of individuals and ensure that they have an understanding of the ideas presented in the Crash Course, before any national or global solutions will even be possible. Because we are still quite far from this tipping point of understanding, we must first focus on educating. Many people have already reached a place of understanding and assumed responsibility for their futures, but most have not. Once we have achieved a critical mass of people who understand the issues and have taken responsible actions as a result, solutions will find more fertile ground in which to take root. The theory of action: building understanding Solutions should come from a position of understanding. Understanding arises from awareness, and awareness arises from the ashes of denial. In other words, the stages of action are: denial >> awareness >> understanding >> solutions. It is not enough for people to be aware that inflation exists, or that our monetary system has flaws, or that resources are depleting. If effective actions are to be formulated, then understanding is essential.