Morgan Housel

And so when everything is great, nothing feels great.

It's all what you want is contrast, contrast, contrast.

And so I think about that a lot in terms of like,

It's not necessarily how much you have.

It's just the contrast to what you have before.

Related to that is that people are very psychologically triggered by downgrades because you're still contrasting it to what you used to have.

And everyone has probably heard the studies of like, what would you rather have?

Would you rather have a net worth of a million dollars when you used to have 2 million?

Or would you rather have a net worth of 500,000 when you used to have 200,000?

And psychologically, most people would rather have the former.

Like the contrast of being like, I used to have two and now I only have one, that leaves you feeling much poorer than if you had 500, but that's your all-time high.

And so I think people is very sensitive to the psychology of downgrades.

Part of this is like the reason that there's opportunity in the economy is because the market, the world, the free market is going to make you pay a price.

to get something good.

It's not just gonna hand you wealth for free.

You have to do something for it.

And by and large, what you have to do in capitalism is put up with a never ending chain of uncertainty and volatility and things you didn't see coming.

And so it's never fun to deal with that, a recession, a job loss, or stock market goes down 30%.

It's not fun, but that's the cost of admission for doing it.

And I think once you view it as the cost of admission and not a punishment for what you're doing,