Should I plan as if I am going to live forever, or like I’m living on borrowed time? None of us really knows how long we will be allotted on this planet, but economic reality tugs at us to plan for something.
In business if you feel threatened every day by incoming storms, you look at everything short term. Liquidity is of the utmost value and you accept just about any offer thrown at you.
If you feel bulletproof, you make grandiose long term projections and arrogantly reject most propositions as unworthy of your big plan.
Most of us play somewhere between these poles. An owner or manager needs to understand his risk tolerance but find associates who can argue him off his tendencies.
When I was growing up in the machinery business, I saw my father swing from highly optimistic to dreadfully fearful over the course of a week. His partner Aaron Pinkert’s role was to balance my dad’s moods and behavior. Both men understood the drill. My dad’s energy was offset by Aaron’s sobriety and his fear mollified by Aaron’s cheerful views. My father always had the deciding vote, but Aaron could talk him down from the ledge or remind him he needed a parachute.
But what if pessimism and negativity become your default position? What if darkness is all you see in the tunnel, and you know deep in your bones you are correct in your downbeat view of the future? Just look to the financial markets and read the bearish blogs, and you find a lot of smart people holding the “world is going to end soon” position. Gather your gold and your guns and find a defendable cave because the Visigoths are down the road.
That may be right. But before the conflagration, there may be a lot of money to be made and fun to be had. And that interim period could be a long time–maybe decades. If you go to the dark side you may survive the invasion, but look what you’ve given up.
One of the riddles of life: Do you feel safer if you know your glass is half empty?
Question: If Romney wins the republican nomination, November’s election will be Harvard Law vs. Harvard Law. Does that bother you?