We were so encouraged in 2007. Al Gore was the 2007 Nobel Peace Prize winner, we had the momentum generated by a new awareness.

There was the recognition that this is a war over resources, an energy war, that has quickly become a water war, a food war. The explanation by the Nobel Committee regarding this award was simple, and perhaps flew under the radar. Paraphrasing, the Nobel Committee stated, correctly, that global warming will lead to shortages of resources, and those shortages will lead to migration of peoples, and also to conflicts over resources. War. Access to resources, brings power and control over money.

We have seen the enemy, and it is us.

Last week, in close proximity, three distinctly separate news stories broke.

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There’s a great amount of research being done on the emotional and psychological impact that money has in our lives. Any day now, Barnes & Noble will announce their “Money & Happiness” section. We’ll see the different ways that we are affected, but first let’s get some basic facts out of the way.

Investor psychology

Psychology affects investor returns, more than any other factor. Studies have shown that losing a dollar bothers us 2.5 times as much as making a dollar.

It’s the reason that during a five - year run, when the market averaged 12.5%, the average investor earned only 2.5%. Why? Buying high (comfort) vs. selling low (fear).

Brain Damage study

A recent study evaluated individuals with a certain kind of brain damage. Affected was the portion of their brain that experienced fear. This study determined that these individuals made far better investors than those without this damage. They didn’t make decisions based on fear, or comfort…their feelings were effectively taken out of the equation.

But there are things that we don’t see about value and money. Here’s a cross-section of scenarios.

Quote: “We
can’t solve problems with the same kind of thinking that

Q. How scared should I
be?