funyuns

It’s another bad day on Wall Street. As of the time of this posting, the Dow is down about 237 points to 6,826. Today’s bad news is that AIG (you know, the company we bailed out so that employees could go on a luxury retreat) posted a $61.7 billion loss for the 4th quarter of 2008. Now they’re getting another $30 billion of federal aid our tax dollars. Expect more bad news for the next few months – we’re not out of this yet.

Despite the losses that we have all suffered, we should keep things in perspective. I know that what used to be my “portfolio” now more closely resembles a Post-It note and people are panicking about their losses, but give some thought to what we have gained in our lives. In our peculiar thought process, we humans tend to focus more on the pain loss than the joy of gain.

If I were to ask how much your 401(k) lost last year, most of you could probably give a pretty accurate dollar amount or percentage. Now if I were to ask how much your investments increased in the year prior to the financial crisis, you likely have no idea. That’s just how we tend to think.

Here is another example to consider. Imagine you are walking down a sidewalk and find a $5 bill. You feel pretty good for a minute or two, but soon forget about it. As you’re walking down the sidewalk, you come across a vending machine and have a sudden craving for some Funyuns. You put in a crisp one dollar bill and punch “G-4”. The dispenser screw begins to turn and then the unthinkable happens… the machine stops and your Funyuns remain precariously perched on their rack. In your anger and disappointment, you shake the machine but to no avail. Your anticipation for those deep fried onion flavored corn snacks turns to utter defeat when you realize that the bag will not drop.

Even though that bag of Funyuns probably only cost 50 cents, the disappointment you feel for that loss is greater than the joy you received from finding 10 times that amount on the sidewalk. There are $5 bills to be found all over the place. It would probably do us all some good if we started being thankful for them and stopped obsessing over our teetering Funyuns.