Thursday, February 12, 2009

Optimisim vs Pessimism

I sent an article to a friend and received a quite different reaction than what I expected. I originally sent the article to reflect an opinion that was based on logic. However, it became an exchange of whether the writer is pessimistic or realistic. Although the tone of the overall article is dark, he uses well organized examples to defend his points. I didn't think it was pessimistic but rather a realistic vision of what will happen.

Back to the title. I've always considered myself to be somewhere in the middle, neither optimistic nor pessimistic but realistic. Having a label never fit me either and I like to be objective in how I see things and not have it distorted by opinion. However, having lived in the US for over 15 years I've become immune and sometimes repulsed by the overt optimism that goes around and the constant accusations that I am a pessimist because I say what I see.

If there is a 100ml glass and there is 50ml of water in it, it's still going to be 50ml of water no more no less. What difference does it make that it is half full or half empty. Why is it better to be optimistic than realistic? Having hope is a great thing, but not when it is pushed into people's minds. In essence you are trying to change the way someone thinks to match yours, you are pushing that person out of reality. Being optimistic is a good thing especially in these dire times when we need to focus on how to straighten ourselves out. However being optimistic all the time leads to a false sense of hope and a dislocation from reality.

Why do I mention optimism? Often I read articles or watch a video selling that the market has hit bottom and that now is the time to buy if you want to make money...Well, the same thing was said a few months ago and nothing has really changed much, we are still slipping lower in the markets. Before that? Remember when the fundamentals of the economy were sound? People are starting to sell hope and market to people based on hope. There's a problem with this because it means that the average consumer does not have enough knowledge and base their purchasing on people who are interested in selling and not accurately reflecting what the reality of the situation presents. I'm sure some people reading this blog are thinking that I am pessimistic.

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