The Voice Of Fear


Hey I just won the lottery!


No just kidding.

Good because I would of had to kill you.



There is nothing more disturbing to the human sole

then watching your neighbor get rich.

Often times I hear people say that Wall Street is all fear and greed. That is true, but also kind of redundant because greed is fear. Greed is simply the fear of being left out of the success of  'the group.'


Con artists are a prime example of greed as fear.


During The Great Depression, Charles Ponzi, the father of the pyramid scheme, collected $25 million from average people who had little or no money. He did this by causing a frenzy amongst common folk and scaring them into joining in on his fraudulent scheme.


Even when confronted by angry mobs that wanted their money back after it was exposed as a lie, Ponzi coolly addressed them. He acknowledged that the way he had said he was making money was a lie, but that he had lied so the market would not find out what he was doing and therefore end the 'opportunity.'


This did little to calm the crowd out for blood.


Ponzi surprised everyone and opened his safe to anyone who wanted to leave with their investment money back. The crowd calmed and moved in to get their money.


“There is only one provision,” he said. “If you leave with your investment, you will never be able to invest with me again.”


His words stopped the crowd. The fear of being left out, on the outside chance he really was telling the truth, made everyone back out of his office without taking their money.


Eventually everyone lost their money and Ponzi died penniless in jail. The fear of being left out is one of the most powerful forces that fear creates, because it goes deeper then just money. It is also separation from the group which creates the ultimate fear; the fear of loneliness. Not loneliness from the perspective of being alone, but rather of being left out by humanity.


People would rather fail as a group than risk being a possible success on their own. That is why misery loves company. When markets crash people take comfort in not being the only ones losing money.


When it comes to playing stocks, everyone knows you have to buy low and sell high. So why is it that many people buy high and sell low?


The reason for this is the same fear of being separated from the group. To buy low you have to come into a market that the group won't touch and to sell high you have to sell into a market the group sees only going higher. This ability to separate from the group and be a contrarian is at the foundation of being a successful investor.


Every con man since the beginning of time has created this fear in people to get them to throw out common sense and become easy marks. Ponzi's scheme ended more than 80 years ago. The names have changed since, but the con man's approaches remain the same. Bernie Madoff created the same fear of being left out and this time collected $65 billion.


When you realize that greed is just another name for fear, and that the fear is rooted in being separated from the group, you have taken the first step in never becoming a con man's mark.

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