The Happiness Meter

By David Galland

It was best-selling author Robert Ringer who first brought the concept of a "Happiness Meter" to my attention. (A bit of trivia: Ringer was involved in publishing Doug Casey's first book, The International Man).

According to Ringer, every one of us humans comes right off the showroom floor equipped with a Happiness Meter that allows us to check in on how satisfied we are with our lot in life at any given point in time. You can try it yourself right now by asking yourself how happy you are at this very moment, on a scale from 1 to 10 - with 1 being thinking dark thoughts about stepping off high places and 10 being whirling about like a Sufi dervish in the throes of ecstasy.

In Ringer's view, if your Happiness Meter is pointing somewhere to the south of the number six, you might want to consider taking corrective action.

Fortunately, with a bit of reflection, it is usually relatively easy to identify the factor in your life causing your level of happiness to wane.

As an example, over the last 45 minutes my usually reliable Dragon Speaking software went extraordinarily buggy and started calling up blank emails every time I spoke... the music in my headset stopped playing and refuses to start up again... and my primary online brokerage account refused to let me in, instead notifying me that I must make a phone call should I wish to transact further business.

Meanwhile, in the background of my basement office/pool room/video room/workout space - usually my fortress of solitude at this hour of the day - a member of the immediate family whose name will go unmentioned has decided that Friday morning is a good time to listen to a lecture on the history of ancient Asian trade routes while exercising. And, as would be expected, they were listening to said lecture loudly enough to be heard over the spinning noises of the stationary bike - the result of which is that, while trying to pull together the necessary concentration to write these musings, I was a victim of collateral knowledge.

Normally, one expects, and therefore easily adapts, to the occasional glitch in the smooth flow of one's daily routine, but when the glitches avalanche as they did this morning, adapting requires actions more tangible than unleashing a stream of colorful language, most of which was fortuitously masked by the professorial observations emanating from the far side of the room.

In this particular instance, mitigating the circumstances causing my Happiness Meter to veer sharply to the left involved taking a deep breath... hitting the reboot button on my computer... doing 10 push-ups... and plugging in a new headset (the malfunctioning one is temporarily resting where it landed somewhere over my right shoulder). The exercise and history lesson now complete, I have been returned to my solitude.

And so it is that, with my music again blasting in my headset - ensuring my declining years will include regularly asking, "Eh? What did you say?" in an altogether too-loud voice - my Happiness Meter has rebounded to a near-normal level much closer to 10 than to 1.

Of course, there is a big difference between passing bouts of unhappiness such as what I am now well on the path to recovery from, and those more systematic. While, now starting late, I don't plan on going into any depth on the subject, I do have enough steam left to make a few observations that you may find useful, especially if you like to make your own investment decisions.

What Moves Your Meter?

Every society is permeated with informational and philosophical threads that, together, form what is commonly referred to as "conventional wisdom." For instance, conventional wisdom in much of the developed world informs us that hard work and diligence result in material rewards. And that those material rewards translate into ever-increasing levels of happiness.

In fact, I suspect that most people, if asked to do so, would reflexively plot happiness and material wealth in a lockstep progression: the more wealth, the greater the level of happiness.

There have been a number of studies on the subject, though most of them are highly suspect - including one conducted by Princeton University, which stated that over the "scientifically derived" level of $75,000 in annual income, happiness fails to progress further.

Naturally, no sooner had the study hit the desk than certain progressive elements of society piped up with the conclusion that government policy should effectively limit everyone's income to that magic number. According to these altruistic folks (albeit altruistic with your money, not necessarily theirs), it's only logical that taxes should be highly punitive once the high-water mark on happiness is reached - after all, once you've reached the $75,000 mark, what's the point of having more?

While, of course, I disagree with the notion of limiting anyone's income for any reason, I actually don't disagree with the notion that money not only can't buy you love (loving, perhaps, but not the real thing), it can't buy you happiness, either.

Viewed from a slightly different angle, social convention has evolved to the point where chasing after money is as subconsciously normal as hunting small animals was to our primitive ancestors. To those ancestors, success in the hunt made the difference between eating or not eating, and maybe starving or not starving. In the modern context, the money chasing - especially for those who have already taken care of fundamental needs - has little to do with providing the essentials of life and, it seems to me, is only tangentially connected to happiness.

Of course, that is not to say there is no value in money chasing. For some people, having more money than the next guy provides a satisfying ego boost or enables them to attract a better-looking mate (much the situation with the ancients, as well), but I suspect in the case of many, the money chasing is merely reflexive at this point. It's just what we do.

But if more money doesn't correlate to more happiness, then what does?

In my opinion, based on much observation, the answer requires turning inwards. That's because while there are commonalities in what makes people happy, in the final analysis, the factors that move the meter are highly personal.

To the extent that it helps frame the topic, following are just a few of the elements in my life - in addition to properly functioning electronics - that push my Happiness Meter into positive territory.

• Exercise. Not too much, not too little - but regular bouts of sweat-inducing, heart-pounding physical exertion to keep fit and reduce the odds of being visited by the specter of poor health. Of course, everyone knows this to be true, yet millions of people still fail to take even 30 minutes every other day to do something physical.

• Study. It's odd that I - whom every single classmate from my school years would confirm as an indifferent student - should place such a high value on study, but I do. If I have learned anything over the years, it is the confidence-building power of knowledge. Each time I study something I am intensely interested in - which is all I ever study - I feel as if I have tuned up my brain. As I tell the kids to the point where they roll their eyes, "If you aren't learning something every day, you are standing in place."
  
  (For self-directed investors, there is a wealth of great information out there to sharpen your skills. Start with the fundamentals - I always recommend Benjamin Graham's classic The Intelligent Investor - as that will steer you away from the many reefs associated with chasing after unrealistic returns. Then expand from there. So, not only can studying make you feel happier, it can make you a more successful investor as well.)

• Humor. Given the number of ugly, threatening and real and potentially dangerous elements present in the world, one should take every opportunity to enjoy a good laugh. Look at it this way, the world is always going to be the way it is, so if you want it to be a happier, more fun place - that's got to come from inside.

• Everything in moderation, including your excesses. I have never gone along with the modern meme in Western nations, the United States in particular, that one shoul d live like a Puritan. You know, that a glass of wine every now and again is acceptable, but stringing two - or heavens forbid, three! - glasses together categorizes you as a wastrel in the eyes of polite society. Personally, I like to hang out with people who like to have a good time. Even so, giving in to excess on a regular basis triggers consequences that are likely to decrease, not increase, happiness and so should be kept in check. Too much of a good thing can very much be a bad thing.

• Challenges/new experiences. There may be nothing I dislike more, which is to say nothing that dampens my Happiness Meter more, than remaining on the same path until the point that it wears a rut in the ground. Perhaps that's because I don't believe there is a second and more wondrous life waiting just on the other side of my last heartbeat.
  
  As a consequence, my view of time is rather limited in scope. The simplest of mathematical equations results in the irrevocable fact that ten years from now, I will be 68 years old. Add another 10, and I'll be 78. While I hope good genetics, exercise and maybe medical breakthroughs will help make the years ahead happy and productive ones, at this point in time it is safe to assume that my biological age will become a limiting factor in some of my decisions.
  
  The conventional wisdom about such things is that the older you get, the more you should hunker down (and don't forget to double lock your doors!). Which, in my view, is the same as sitting for a coffin fitting.
  
  Instead, I am a huge believer that if you don't constantly find new ways to challenge yourself, whether by climbing a mountain, starting a new business, taking up a new sport, moving to a foreign country... something!... you will slowly degrade into a shadow of your former energized self. And how can anyone be happy about that?
• Compromise reluctantly. This is a hard one, because we are all asked to compromise every day. Only a truly selfish person never compromises, but when it comes to the big stuff, only a fool - or someone willing to live an unhappy existence - gives in. While I understand the dynamics and in many cases sympathize, I have a hard time understanding how a person remains in a bad marriage, no matter what the reason. Likewise, how anyone stays in a bad job, or remains in a bad neighborhood, or sends their kids to bad schools. That is not to say that breaking the bonds of the norm, no matter how bad the norm may be, is easy - it usually isn't - but failing to break those bonds means accepting life as a slave.
• Meditation. Most people who know me probably wouldn't categorize me as the "New Age" type, and I'm not. But when I was in my early 20s, I pretty much accidentally stumbled into a transcendental meditation class during which I instantly connected with the benefits of being able to calm and clear the mind at will. As with all things, I don't take it to excess (like the guy I know who spent 10 years getting smacked in the back for bad posture by his Zen teacher in a Japanese monastery), but I do try to find 15 or 20 minutes of quiet time each week - usually after a workout - where I zone out while listening to music punctuated with tinkling bells, softly falling water and the likes.
  
  I know it may seem a bit foolish, but if you've never tried it, you should. I know a guy whose father and grandfather had both died of heart attacks before the age of 45; he meditates every day and is still going strong in his late sixties.
• Family and friends. Reasonably well-behaved kids and interesting friends can add a lot of depth and context to a life. Conversely, just because someone is genetically related or is a friend of long standing doesn't give them license to ignore certain standards of civility.
  
  Yet, many people cling to negative relationships no matter how low they pull them down. Personally, I refuse to maintain dysfunctional relationships. As a consequence, I have several relatives whom I now have next to no contact with and don't worry about it at all. Likewise, I have my share of former friends, including one well-known but consistently misguided financial guru who was positively shocked when I told him, "Listen, there are better than six billion people in the world, so I have a wide choice of people whom I can associate with - and you aren't one of them."
• Music. I was never particularly musical growing up and don't have a very sophisticated taste in music even now - but I know what I like, dramatic music that almost never fails to lift the spirit and triggers vigorous foot tapping. (As I write, Sympathy for the Devil by the Rolling Stones is blaring through my now working headset.) For some people, this role is filled by art, flowers or whatever lifts the spirits.
• Create. A very important factor in my life, and in the lives of most happy people I know, is to constantly be creating things. It doesn't matter if it's a polished block of wood with slots for the kitchen knives to slide into or a full-blown orchestra piece or silly YouTube video - I can't imagine how a person can be fundamentally happy if they aren't creating... something! Speaking of which, if I haven't thanked you lately for allowing me to share my weekly musings with you, and for your many nice letters, thanks - you've made me very happy!

I could go on but will stop there. If there is a point to these ramblings, it is that, in my view, each of us is innately aware of almost mechanical steps we can take to positively impact our Happiness Meter.

In my case, if I am not feeling particularly happy - and nobody can be perfectly happy all the time - by returning to my personal fundamentals, I know that without question pep will soon return to my step.

Does this really have any relevance to those of us who like to manage our own investments? I think it does.

For example, if you find yourself staying up at night worrying about your investments, it's a clear sign you are doing something wrong. You can choose to continue being worried, a clear sign of unhappiness if there ever was one, or decide to do something about it.

You might start by making sure that your worries aren't simply an outbreak of over-emotionality caused by other factors in your life: exercising too little, problems on the home front, concern over a job, etc. We humans are complex creatures, given to all sorts of unwarranted worries - so make sure your basics are covered before doing anything rash. Panic almost never does anyone any good.

Next, you might want to study your portfolio, specifically the reasons why you own each of your holdings and what you expect of them. As I have commented upon previously, tangible investment risk is largely a function of the likelihood that you'll be forced to sell at an inopportune time. If your investment logic is solid - and that logic should always be based on being positioned on the right side of powerful trends, then not overpaying for the investments that you choose to play those trends - the daily gyrations, no matter how severe, should be of almost no concern.

If on checking your premises, you discover that nothing fundamental has changed that would have altered your original premise for making a specific investment in the first place, then your worries should drop away and your Happiness Meter rise. Alternatively, if you find you still have your doubts, then you are almost certainly overinvested in whatever is worrying you, and you should look to reduce your allocation to the point of unconcern.

Then you might want to get together with some friends, crank up the music, tell a few jokes and maybe do a little whirling about.

Whatever you do, don't let the persistent problems of the economy define your life or cause your Happiness Meter to get stuck in a bad place.