The New Anatomy Of Risk From A Buddhist Perspective

The financial world is upside down and by now even a blind man with a stick should be able to see it. I have been involved with trading the markets for many years and am well versed with the psychology of trading and investing. It is a fact that there are still an amazing number of people who believe that the present situation can be easily remedied.

Unfortunately, there is nothing in my analysis that says that we are anywhere near an end of this cycle of collapse and this has major consequences for your risk policy.

Yes. it is true, cycles repeat themselves, but never ever in the same way. The internals of today's financial markets are very different from previous times.

An entirely new psychology is evolving amidst the ongoing market turmoil. This major transition will inevitably change the fabric of the western world, there is no getting away from this fact.

We are in the middle of a major paradigm shift which will end the excesses, the mindless spending and greed seen in the last couple of decades. There is a move towards inner values and that had to happen sooner or later, simply because the emotional rubber band got stretched too far and is now snapping back with vengeance it seems, but when viewed from the standpoint of universal wisdom as taught by Buddhists for 2500 years, it is just nature evolving as it always does.

Hinduism describes life as an ongoing cycle.

Developmental theory shows that we are always moving forward and not backwards. What appears to be a backwards move is in essence nothing but a pause or rest in the evolutionary process of life and everything in it. We can only move forward and as we grow we see more of our world. It is this simple process that creates progress.

It also explains why the old ways of doing things eventually stop working. In other words, the indiscriminate use of Keneseyan methods to fix the present financial crisis will not work as they have done in the past. If you are dealing with your portfolio employing the old asset allocation models simply because it worked in the past, you will be in for a big shock.

The present ending super cycle is ushering in an entirely new cycle and a new reality. You must understand this if you want to navigate the financial waters profitably over the coming months and years, possibly decades.

If you are using the old risk assessment models to calculate and minimize risk without taking into account the changes in investment psychology and the change of the collective consciousness in general, you may actually increase risk exposure in your portfolio.

We have to face the possibility that the present financial system will collapse completely. This is not the place to go into cycle analysis in depth, Suffice it to say for now that there is nothing in any long term cycle analysis that points to a continuation of the old system.

Quite the opposite is the case

We have been kitting together a weak system simply by putting super glue in the cracks of the pot. Finally the pot is held together by the glued cracks only. It has lost its original strength. I could also say its energy matrix has changed and the pot may collapse completely. If it remains together somehow it will finally be unrecognizable from the original pot. You will not be able to use it and look at it in the same way as the old pot. This is where we presently are in this economic cycle.

Therefore, be careful with corporate bonds and government bonds, even though these are traditionally viewed as safe heavens. These traditional investment instruments are not nearly as safe as you might like to think in our present situation.

While I sincerely hope that we will not see a complete collapse of a system that after all also has its good points, one must be mindful of the possibility. It conce
s me to see that the governments are blindly going back in history using old methods to fix the new problem. They are completely out of touch with what should be done to move us out of this crisis.

If you examine carefully the economic cycles over the last thirty years alone you will notice that each time we try to remedy a problem with the same old methods the rebound became faster and sharper. This is not a sign of sound recovery but a typical sign of an ending cycle. The warning bells have been ringing at least since the last crisis of 2001 and if you had been very observant since the nineties.

Today, we need new ideas, we need people who have vision and sensitivity and who are in tune with universal life principles.

An integral approach is needed and this means an approach that considers the entire system, and not just random aspects of it. The financial markets are a breathing, living organism. They are a reflection of the human psyche. You cannot blindly pump money into an economy without considering the general population, or, should I say, the entire world system as a whole.

Money needs to be handled with respect and sensitivity, just like you should handle another human being.

All said and done, the basic building block of money is energy, just like you and I. In that sense money is an integral aspect of you and I. Once you understand this, and what's more; if our governments understood this everyone would deal with the present situation in a very different way.

The present situation is calling to relinquish ego considerations and acknowledge that there is no escaping from the fact that everything is one and inter connected. Everything we do has an effect and that effect that compounds because we are dealing with a holographic expression of an intelligent energy matrix that permeates everything. Money, the economy, risk all are expression of our spirituality in an infinite universe; and as such they are dynamic and never fixed.