I hope that our portfolios make a full recovery, but if they don’t we will have an opportunity to show our friends and family what we are made of. This may sound like happy talk, but you will be more comfortable waiting for the end of the world if you take some time to seriously consider the opportunities that would follow. The paper value of your portfolio has no effect on the beauty of the sunset over Catalina and it does not define the range of your options. Financial catastrophe is not fatal, which is a big plus, and most of the other catastrophes we anticipate aren’t fatal either. If you survive, you will adapt to your new circumstances and move on as you always must and do. In fact, you will probably be about as happy as you were before. Your past experience should bear this out and this should cheer you up.

     The current economic crisis is a perfect example of the general catastrophic sensation because it is so widespread and so frightening, but many of us experience something like it on a regular basis. The sense of impending catastrophe can be associated with anything from intimate relationships to sports. I dread the possibility of discovering a nasty computer virus that I cannot eradicate from my hard disc. Mother Nature has equipped us with the capacity to feel this way in order to motivate us, but note that the sense of impending catastrophe can result in either anxiety or exhilaration, depending on your perspective and your habits of thought. Many effective executives and all cage fighters are exhilarated in proportion to the magnitude of the catastrophes they contend with. By these lights it’s not really Kung Fu if you aren’t involved in a brawl with bad guys on every side.

     We are not simply at the mercy of distant bankers and the inscrutable global economy, even though we cannot control or anticipate them. We have the freedom and responsibility to choose our own response to threatening circumstances. When the sense of impending catastrophe grips too tightly it is worth taking some time to systematically undermine it. This may not improve your balance sheet but it will certainly improve your balance.