Selling You Recessions - Don't Buy In

The greatest obstacle to discovery is not ignorance - it is the illusion of knowledge.
~Daniel J. Boorstin


Have you ever climbed a tree or a hill and felt and sense of euphoria until someone said, "Boy, you're really high up."  Then your joyful moment may have been transformed to fear. You're happy until you suddenly became aware that you were a long way from the ground below. Your energy may have changed and unless you can get your mind back on the euphoric feeling, you're likely to experience some panic.

Panic. That's an interesting word. It refers back to the Greek god Pan. He was capable of, and often did, cause humans to flee in unreasonable fear. Until the past few decades, before it was cleaned up by the more clinical word recession, economic downturns were referred to as panics. It's a much more apt term because economic downturns are often nothing more than a psychological event heralded by a hypnotic suggestion.


Pan's ability to frighten came from his ability to cause a human being or even a god to forget the supposed "sanity" of civilization and revert back to a primal state - fear and terror. Economic panics do the same thing. People revert to primal, survival instincts and lose all common sense. Sell, sell, sell becomes the cry on Wall Street and stock prices fall. Cut costs, cut costs, cut costs becomes the cry in business and jobs are lost causing people to have less money to purchase things. This causes a legitimate loss of business which reinforces the cycle.

I mentioned hypnotic suggestion a moment ago. Those of you old enough to remember the 2008 recession remember that one day we were cruising along in bliss; kind of like when we're climbing the tree. Then the media and politicians began saying the word recession and suddenly we realized how far up we were and panic ensued. Once the world was planted in our minds, the cycle took on a life of its own.

Now, I'm not saying that all the ridiculous speculation among the banking and investment class didn't cause the factors for recession. I'm not saying that the flawed economic models we operate under don't have an inherent "business cycle" baked into them. That's all true.

I am saying that the actual beginning of it - the part that caused people to start behaving like they were living in a recession - happened when that hypnotic suggestion was made. I am saying that the actual length and depth of the recession is created by people and businesses beginning to act like they are living in a recession. People spend less. Businesses lay people off.

Warren Buffet has famously said that the secret to his success over the years has been to buy when other people are selling. It's the best time to get a deal. Most of you are familiar with the movie It's a Wonderful Life. That's what Mr. Potter, who represented the banking class, did in that movie. When the panic hit, he bought up more of the town for pennies on the dollar.

Now, let me ask you something. If you've been in a position of tremendous wealth and power for many years and you know these cycles happen, and you know people will begin acting like there's a panic if all the media outlets start telling them there is panic; couldn't you initiate one whenever you chose? If you know it's all a mind trick, but everyone else believes it's real, couldn't you garner more and more of the wealth to yourself over time? It's a simple formula.

  1. Consolidated media ownership.
  2. Simply, say the hypnotic word.
  3. Let the reaction happen.
  4. Swoop in and buy things up for pennies on the dollar.
  5. Rinse and repeat.

I mean what if all these news outlets are all being scripted to say, "Recession, recession, recession."

You may have seen these charts (below) a couple of years ago. The first shows what Americans think the wealth distribution is in The United States. They think it's pretty uneven. The second is what the distribution actually is. It's much worse than people think. (Article continues below)

actual income distro.jpg

It's gotten worse since 2008. There were all sorts of examples have Mr. Potters sweeping in to buy up resources on the cheap because everyone else was in a panic. Banks bought banks and investment companies and power and wealth became more centralized.

I've noticed in recent weeks, the first signs that the media is starting to say, "You're pretty high up in that tree." They'll use phrases like the economy is "overheating" or "You know there has to be a pull back at some point." They're greasing the skids to yell, "Recession!"

How do we battle this mindset and overcome it?

Individually, it's a challenge. Telling people this is all an illusion, a mind trick can feel a little like this scene from Animal House.

Yet, if we cannot stop the herd from stampeding over the cliff, at least we can empower our own minds. Here are some original quotes, thoughts, and affirmations I've tweeted about this over the years. May you use them to help you see through the hypnosis and make smart moves not panicked moves next time they use panic to control us.

  1. Recessions are mental events more than financial events. There was only recession once the thought was planted.
  2. A recession begins the moment people start believing in it and ends the moment they stop.
  3. A recession is a mental event caused by a thought planted in our minds. Hearing the word, companies and people dutifully behave accordingly.
  4. A recession is a moment in time when opportunity is on sale.
  5. Booming minds create booming economies. Recession minds create recession economies.
  6. A recession is simply a collectively negative financial mindset. You choose whether to participate in that mindset.
  7. Career Affirmation: I am recession-proof! I have the skills and the confidence to compete in a tough economy.
  8. Prosperity Affirmation: I'm so busy prospering I don't have time for recession in my life!
  9. A recession is when authoritative figures shout fire in a crowded theater and then scoop up your abandoned popcorn cheap.
  10. Recession is just a word. We make it harmful by giving power and acting as if it were true.
  11. Economy Affirmation: "My recession is over. Prosperity and possibility are again growing in my mind!"

Ray Davis
for 6 Sense Media