Power Up Wealth podcast – Something Very Bad Is Coming – Episode 78 transcript:
Sharla Jessop 0:00
We live in an information age, which means often the information that we’re receiving is negative. I’m Sharla Jessop, President of Smedley Financial Services, and today, my guest and colleague, Jordan Hadfield, will share an article that he wrote titled it Something Very Bad Is Coming. Sounds so negative. I’m really interested to hear what he has to say.
Welcome to the SFS Power Up Wealth podcast, where we provide impactful insight and expert opinions on timeless financial principles and timely investment topics, preparing you to make smarter decisions with your money.
Jordan, thank you for joining me today.
Jordan Hadfield 0:55
I’m really excited to be here.
Sharla Jessop 0:56
Jordan is part of our wealth management team and an advisor, and he holds a Certified Financial Planning designation as well as a Behavioral Financial Advisor designation. Jordan, I’m reading your article titled Something Very Bad Is Coming, and I can’t imagine what you’re gonna say. It feels pretty negative.
Jordan Hadfield 1:11
It does feel negative, doesn’t it? Yeah, my comments today are really more focused from the behavioral financial side than the CFP side. It’s interesting. You know, I write this article, and I intentionally give it a very negative name. And the reason why I did that is because anyone who reads the article or reads, you know, maybe the title of this podcast, they’re gonna have a reaction to that title, and they may not realize it. They probably don’t realize it, but that’s gonna trigger an emotional response in them, different than if the title of the article was say something very good is coming. It’s that very thing that I want to focus on, and that is why I chose the title that I did that sounds so negative, because we have a tendency to focus on the negative, and it’s nothing that we can control. Even the most positive people among us do it. It’s called a negativity bias, and there’s a ton of neuroscience behind it, as to why we tend to focus on the negative. Why negative headlines have a much stronger emotional response, why they stay with us longer, why we dwell on them, why we think of them, why they grab our attention far more than positive news. I think that’s really interesting.
Sharla Jessop 2:27
I find it interesting too, because I’m subject to the same headlines everyone else is reading.
Jordan Hadfield 2:31
We all are.
Sharla Jessop 2:31
And you read a negative headline and you immediately create a negative picture in your head. As a matter of fact, I hope you don’t mind me sharing this, but you had shown the article to someone in our office who read the headline and said they didn’t like the article because it was just too negative.
Jordan Hadfield 2:45
Yeah.
Sharla Jessop 2:45
They didn’t actually read the article yet. They just the headline impacted them so much.
Jordan Hadfield 2:50
Yeah, they said, I really didn’t like your article. And I said, Well, did you read it? And they said, No. And I said, Exactly. That’s, that’s you’re proving my point for me, exactly.
Sharla Jessop 2:58
So Jordan, you’re saying this negativity bias is inherent. Tell us a little bit about that.
Jordan Hadfield 3:03
Yeah so let’s go back in time, way, way back in time to the beginning of humanity. Let’s pretend that you’re in a forest, and you’re there with your spouse, and maybe you’ve got a child or two, and this forest is providing you shelter and sustenance. Okay, there are rocks for building tools, and there’s wood for building shelter. There’s berries and nuts in this forest you can gather to provide for your family, but in order to get that food, you have to go out. Out is scary. Out is where the threats are. So you go out on a path and you’re hunting for food, and you’re walking and you’re searching, and you’re searching, and you’re walking and you’re walking, and a bear! And all of a sudden, epinephrine and cortisol and your heart rate spikes, and breathing quickens and blood vessels contract and digestion stops. Vision focuses, your pupils dilate, hearing decreases, muscles tension, your body has just reworked itself. You see this threat, and your body has changed from a physiological state that is suited to explore to one that can best address, assess and deal with the threat. That over time has led people to focus on the negative, because focusing on that threat literally has meant survival. Okay, this has happened 1000s of times throughout human history, but in early humanity, there was a direct correlation between our emotional sensitivity to the negative and to survival. In other words, the stronger the emotional response we had to negativity, the better our chances of surviving, and the better our chances of surviving. Meant we were more likely to pass this sensitivity to the negative through our DNA to the offspring and our offspring that were more sensitive to the negative also had a greater chance of surviving. So this negativity bias is really innate. It’s evolved over 1000s and 1000s of years. I mean, it has led to human survival. It has saved countless lives, and it’s a very, very important aspect of who we are and how we’ve come to be in today’s age.
Sharla Jessop 5:03
So what you’re telling us is, though, even though the headlines where we’re reading negative or the podcast we might be listening to with negative headlines or negative information has nothing to do with our survival, we’re still going to be impacted by that negative information.
Jordan Hadfield 5:19
Yes. It’s inherent, it’s it’s part of who we are, and we cannot easily change our negativity bias. So this doesn’t mean that you’re a negative person. If you have a negativity bias. You could be the most positive person in the world. Inherently, as a human, you have a tendency to gravitate to the negative, to pay attention, to have a stronger emotional response to the negative. And that’s what I was trying to point out in the headline of my article, is when you read the headline, something bad is coming. If you’re paying attention, you notice your heartbeat might have raised, and it might have grabbed your attention in a way that a more positive article title wouldn’t have. And I point to that because that’s exactly what what the media is doing to us today, right? They know our negativity bias, and so in an effort to sell headlines, to sell magazines, to sell news articles, to sell products, to sell whatever they’re selling you, they know that if there’s a slight threat in their message, you’re more likely to pay attention to it. If they can arouse just a little bit of fear, they’re more likely to grab your attention. And the truth of the matter is, the people that are writing these articles also have the same negativity bias. In other words, the journalists writing these articles take an article to an editor, and that editor has got a negativity bias. They go through the same process. That editor goes to the boss, and the boss has a negativity bias. He goes through that same process. He okays it, it goes out to publication, and the consumers who consume it have that same negativity bias. It affects us as consumers, but it affects everyone along the way, from the moment the news event happens, all through its whole process, whatever that process is, be it published or be it vocal, be it podcasts, be it whatever. To our ears, it’s gone through numerous people that have the same negativity bias, and over time, that compounds, and pretty soon it feels like all we’re reading is negativity.
Sharla Jessop 7:20
It does feel like that sometimes, like that’s the only news you only news you can find, just the negative news.
Jordan Hadfield 7:24
Yeah, absolutely true. And I want to point out, there’s so much positive in the world. There’s a lot of positive news in the world. It’s a great, great time to be alive.
Sharla Jessop 7:36
You also were said you had been reading a study that was done during the pandemic about information that was available to people.
Jordan Hadfield 7:44
Yeah.
Sharla Jessop 7:44
Tell us more about that.
Jordan Hadfield 7:45
Yeah. So Dartmouth College did an really interesting study on negativity bias and on news right relative to news, and they were focused kind of country by country, and it’s difficult to determine how negative a country tends to be in their news reporting, because the headlines are different country for country, but COVID really gave a unique situation, because the world was reporting on COVID all at the same time. It was happening worldwide. This was a very scary worldwide event, and so Dartmouth College did a study. They read over 20,000 different articles across the world, and what they found was that the United States was far more negative in their reporting than any other country. On average, every article that was written internationally had a 50% chance of being negative relative to COVID. In the United States, it was 87%. That is drastically higher. And what I find so fascinating about it is the headlines, the negative headlines, relative to COVID, weren’t correlated with actually the pandemic and what was happening. In other words, during the long pandemic, there was a lot of really good things that were happening in the world. There was also a lot of times where COVID cases were dropping. The death count was dropping tremendously. People were getting better. There was news of, you know, different vaccinations that that were proving to help, lots of positive things to be talking about. And yet the news remained negative. And so if you chart COVID, like the negative effects of COVID on humanity, it’s volatile. It goes up and it comes down, and it goes up and it comes down. And you would think when it came down, the news would gear more towards the positive or or focus on that, but it didn’t. The news stayed negative throughout the entire COVID cycle at a rate much higher in the United States than anywhere else in the world. I found that really interesting.
Sharla Jessop 7:45
It is interesting, but it makes me think we can’t control the negative news. We can’t control the negative headlines, so how do we emotionally and individually combat that?
Jordan Hadfield 9:52
I think the first thing that you need to do is recognize your negativity bias, and again, it doesn’t mean you’re a negative person. We all have a bias towards the negative. And recognizing that, I think, is the first step of overcoming it. It’s hard to escape the negative news. There is a lot of negative news out there, but I think if you look for ways to find the positive news, and you focus on the positive news, and you share the positive news with those around you, with your loved ones, with your colleagues, with your neighbors. I think if you can focus on that and share that, you’re far more likely to rise above the negativity, and it’s easier for you to see the positive in the world.
Sharla Jessop 10:33
I like that. I like knowing that, or thinking that if we can focus on the positive, the negative won’t have such an impact.
Jordan Hadfield 10:41
Exactly.
Sharla Jessop 10:42
And it can help us focus on a positive outcome in the future, which in planning, that’s really what we’re gearing towards. We’re not looking at all the little bumps and things that are happening along the way, every day, in the market, with the economy and politics. We’re really looking long-term. What are your goals? What are you trying to accomplish? And how can we help you get there?
Jordan Hadfield 11:00
Yeah and if you get bogged down in the negative, it’s hard to have a long-term optimistic outlook. The reason why I wrote this article is because I think the world is not only a beautiful place, but I also think it’s the best time to be alive. There has been so much good that’s happened recently, and it greatly outweighs the bad that’s happened recently. I know it doesn’t often feel like it right, particularly in a political cycle where it’s constant mud-slinging, but there’s so much going on in the world. Modern medicine and technology have exponentially improved over time. Extreme poverty has fallen. World hunger is shrinking. Life expectancy is rising. Long-term homicide rates are significantly lower. Education is on the rise. Equality has never been closer, and this list of positive news goes on and on. There’s never been a better time to be alive than now. I believe that, and I believe that the world is bright for my kids. I look towards their future with optimism and positivity, and I think a focus on the negative news subtracts from that. And so I think focusing on that to just know that the sun’s gonna rise tomorrow and the future is going to be bright. I think that’s important for our mental health, but it’s also important for our portfolios, our investment portfolios. We have to stay positive. The markets have seen tremendous negativity over time, and they’ve consistently gone up. That’s the trend up, and I think that will continue. I’m betting my retirement accounts on it. I’m betting my children’s retirement accounts on it. The market’s going to go up. The sun’s gonna rise. There’s a lot of good happening in the world. It’s a great time to be alive. Let’s focus on that.
Sharla Jessop 12:48
Jordan, I love that message. Thank you.
Jordan Hadfield 12:49
Thank you.
Shane Thomas 12:55
Thank you for joining the Power Up Wealth podcast. Smedley Financial is located at 102 S 200 E Ste 100 in Salt Lake City, UT 84111. Call us today at 800-748-4788. You can also find us on the web at Smedleyfinancial.com, Facebook, Instagram, Twitter, and LinkedIn. The views expressed are Smedley Financials and should not be construed directly or indirectly as an offer to buy or sell any securities or services mentioned herein. Investing is subject to risks, including loss of principal invested. Past performance is not a guarantee of future results. No strategy can assure a profit nor protect against loss. Please note that individual situations can vary. Therefore, the information should only be relied upon when coordinated with individual professional advice. Securities offered through Osaic Wealth, Inc., member FINRA/SIPC. Investment advisory services offered through Smedley Financial Services, Inc.® Osaic Wealth is separately owned, and other entities and/or marketing names, products, or services referenced here are independent of Osaic Wealth.
