- 2001: Volume 10, No. 1 Mind Over Money: Poverty-Conscious Traders

Editor’s Note: Adrienne Laris Toghraie is taking a well-earned vacation. This article was originally published in the March/April 1996 issue of the CRB Trader. We think you will that it is every bit as relevant today as it was at that time.

Are you limiting your profits because of poverty consciousness?

Poverty-Conscious Traders are those individuals who, because of a particular type of negative thinking limit, stop or reverse the amount of profits that flow into their lives. This negative thinking occurs when a trader’s attitudes, beliefs or values are fogged with thoughts and feelings of lack and limitation. This "limited thinking" becomes a self-fulfilling prophecy that can lead to limitation and loss in the real world.

The Echo That Created An Avalanche
Trading brought in a steady, average income for Rick. By combining his income with his wife’s income, Rick’s family lived an upper middle class lifestyle. However, any additional unexpected bills put a strain on their budget. Despite this delicate economic balance, Rick had promised to support the dream of their second daughter to attend an expensive European school.

Then, Rick got the flu. Foggy from the effects of the virus, Rick let a mental stop get away from him. Instead of packing up for the day as he normally would have done, he increased his risk in the next few trades, trying to catch up with his losses. And you know the results.

When he arrived home that evening, he was met with excited, expectant faces. His daughter, taking advantage of winter discounts, had purchased a new wardrobe for school, which she modeled for her father, unaware that this made Rick feel even more guilty for going against his rules. In addition, he was overcome with fear that he could not make up the losses.

Rick was angry at himself and the markets. He could not stop the chatter of negative dialogue in his head. The markets were against him, life was against him, and the future looked bleak. He believed he couldn’t possibly make up the losses. This meant he would have to face the disappointment of his wife and daughter. These thoughts eventually became the reality.

Of course, not all traders react the way Rick did to a temporary loss. Some traders rise to the challenge and make up the lost money in a brief time. And some traders simply take these losses in stride as part of the game. However, Rick’s psychological pump was primed to react to such a temporary setback with anxiety and guilt. Raised in a family that struggled financially to meet the basic needs, Rick harbored a deep fear that he would not have enough and that he would lose what he had. In fact, the level at which he was currently living was way out of his comfort zone, increasing his anxiety and stress.

Tidal Wave Over the Economy
Just as a family can be negatively affected by one trader, let’s consider how negative thinking in the trading community can affect the entire world. When the trading community is in a state of worry about the future, trading becomes erratic. Traders either hold back from trading at their normal level of activity, or buy and sell wildly, thus creating a negative impact on the world economy. There is less money circulating, thereby limiting the activity in the markets, which in turn makes traders even more restrictive in their activity.

The poverty consciousness in traders that results from the activity in the marketplace is a normal but temporary and self-limiting reaction. However, beyond the normal reaction to external forces and circumstances of a trader’s life, he can have many forms of poverty-conscious thinking. This thinking can start at any point and time in his life, although the roots of it are most common in childhood. If a baby, for instance, cannot get his basic needs met, the longing for the fulfillment of those needs can last a lifetime. Even if a trader has the appearance of being affluent, his choice of behavior can sabotage his full potential.

Fly in the Ointment
When Ronald was two years old, his mother suffered from a serious case of postnatal depression after the delivery of his brother. His mother never left him and continued to do what she could to take care of him, but from Ronald’s point of view it seemed that his mother had abandoned him. This feeling of loss lasted even after his mother’s return to emotional health and after everything in his household was normal and happy.

As an adult, Ronald went on to manage over million. However, his deep longing for something missing in his life would bite into his trading money every time things felt too good to last. Whenever he would earn a large profit from a trade, or one of the more substantial accounts would give him money to manage, he would immediately follow with a large loss. Deep inside Ronald’s unconscious mind, he could not trust his good fortune to last. Since he expected it to be taken away from him, he felt he might as well take control of losing it himself.

Here are some specific kinds of poverty-conscious thinking, how they might affect you as a trader, and solutions to these mental impediments.

1. The Unworthy and Undeserving
These traders find it difficult to reward themselves, no matter how much money they have. They live as though they are poor because they feel that they still are poor. In some cases, they are afraid to find any joy in their success for fear it will cause it to end.

Effect: Traders in this category put a cap on their potential earnings by failing to reward themselves when they succeed. The unconscious mind needs to be rewarded for successful behaviors and attitudes in order to be motivated to repeat them.

Solution: Set realistic goals you will be able to accomplish and attach a small reward for yourself. It is important to follow through and enjoy this reward.

2. Self-imposed Notions of Lack and Limitation
These traders buy into the notion that there is not enough to go around. This notion usually starts in childhood when the environment or home life cannot support the child emotionally and/or materially. Very often, as adults, these individuals become pack rats because they feel that someday their garbage will be useful. Many people who grew up during the Great Depression display this behavior.

Effect: Traders in this category are often very disorganized. This disorganization seems to result from a deep conflict within. Their conscious minds tell them that they have a goal to reach and they must get into action. But, their unconscious minds, controlled by feelings and fears of poverty and lack, tell them that their goals are unreachable and hopeless. As a result, they never have enough time to complete anything, and they find a way to create lack and limitation in their trading. In the event that they do create abundance, they are very uncomfortable with it.

Solution: Make your garbage useful now by giving away all of the items that you have not used in the past two years. It is a good idea to have an organized person help you. List all of the things you want to accomplish and the time frame in which you can complete these tasks. Put them in order of importance and either delegate the rest to someone else or give up the tasks that are least important.

3. Doomsday Is On Its Way!
These people live in the shadow of impending disaster: "You never know when you’re going to lose it all so you had better plan as if disaster is on its way." Unfortunately, for many traders, this fear is based on the reality of past, traumatic losses in their lives. As a result, they expect these losses to recur and feel a perverse sense of fulfillment and vindication when they do.

Effect: These traders are perpetual bears. They often miss the obvious upward movements because they are so focused on an impending downward trend. Traders in this category will take profits too soon if they overcome the fear of entering a trade in the first place.

Solution: Expand your present level of risk by 10 percent. When it feels comfortable to trade at this new level of risk, expand it again by another 10 percent until it becomes comfortable at that level, and so on. You can deal with Doomsday when it arrives. But, until then, act as if you are anticipating more affluence with each new day and notice the difference in your life.

4. The Taker: I Deserve It, You Don’t
These people always look at every situation for "What’s in it for me," rather than for a win/win outcome for everyone involved. This position comes from a great insecurity and a sense of lack. These traders often resent the fact that they have to work hard and do not necessarily see the value in other peoples’ contributions. At the very heart of their world view is the notion that there is not enough to go around. Life for them is a struggle for survival. The root cause of this syndrome is often a childhood in which the child’s basic emotional and physical needs were either unmet or attended to with indifference. As a result, they are willing to toss the scraps of overflow to their family, friends and society, but only at their whim. They expect family and business associates to put out an equal effort of labor, but they do not believe in equal rewards for their efforts.

Effect: Traders in this category fail to see that their success is greatly influenced by the willing cooperation of the people around them. Their insensitivity to the feelings of others and their eagerness to point the finger when things go wrong creates stress and bad feelings all around. The negative environment created by these behaviors ultimately affects trading performance.

Solution: If you live by the motto, " You only have what you give," you will find that your life will prosper as your generosity increases. This strategy invokes the power of the "ten-fold principle" which multiplies abundance through prosperity. The people around you will then want to help you become more successful instead of begrudging you each success and looking for ways to sabotage you. As a result, trading will become less stressful because of a less stressful environment and, as a result, more profitable.

5. Hitting the Poverty Tolerance Level
We all have a level at which we begin to feel insecure financially. For some traders, insecurity is reached when they lose their job, with no definite prospects and no money in the bank. Then there are traders who are financially secure, but have a temporary losing streak and feel deprived from being able to enjoy frivolous spending.

Effect: When poverty consciousness kicks in, opportunity checks out, because you are entering a victim state of mind. When you see only problems, you will not find solutions and your performance will suffer until you take control again.

Solution: List a group of actions which would take you toward the success that you want to enjoy and start with the easiest first. This puts you back in control and will pull you out of a victimized state of mind.

6. The Guilt Ridden They feel they shouldn’t have what other people don’t have either. Regardless of their efforts and their successes, they feel guilty in reaping the rewards. A childhood in which praise is absent and criticism is abundant is often the reason for this viewpoint.

Effect: These traders sabotage their efforts in becoming successful so they do not have to face the problems of feeling guilty about having too much.

Solution: Work with the idea of putting yourself in a position of abundance so that you can help many people and share the joy of your successes. At the same time, examine the relationships in your life for friends and family members who are critical and unsupportive. These relationships feed your low self-esteem and need to be either corrected or eliminated if you are going to feel worthy of success.

7. The Success Comfort Zone
Everyone has a comfort zone of success. If a trader grew up in a poverty, he may feel uncomfortable in an expanded comfort zone of success. Some traders sabotage success just to be able to stay in their comfort zone.

Effect: The best case is that your level of success stays the same or you grow very slowly. The worst case is that you create major losses whenever you are feeling anxious about being too successful and outside of your comfort zone.

Solution: In order to have a quick transformation to higher success you must transform your limited beliefs. Dwell on beliefs that would bring you enormous success, e.g., "By the creative actions I demonstrate I deserve to enjoy affluence and abundance." Visualizations of yourself in a new life of abundance can help your unconscious mind accept comfort at each new level of success.

Outcomes For Rick and Ronald
For Rick and his family, downsizing their lifestyle was not an easy transition, but it was a necessary step in repairing the situation. As a result of their downsizing, the family is no longer under the constant strain of barely making ends meet. Rick’s trading performance has never been better. Life is less stressful and toys are more abundant in their new townhome. Their daughter is doing well in a local state college. This summer, Rick is taking his family on a trip through Europe and then will be dropping his daughter off to enjoy her sophomore year at the Sorbonne.

Ronald and I worked at discovering and overcoming the sabotage problem. He now feels confident that he will not have to go through the trauma of those periodic large losses.

Conclusion
Poverty consciousness can affect any trader—from a dampening of profits to large losses. Most traders come by this sense of lack and loss as a result of external and temporary forces. For those traders who have an underlying sense of optimism about their future, they move through this phase and go on to recoup their losses. However, those traders whose psychological pumps are primed for neediness and privation can find themselves permanently stuck in poverty consciousness.

Pulling out of this psychological state is difficult. The first step out is to acknowledge the existence of these feelings of neediness and privation and low self-esteem. These feelings are often buried deeply in the unconscious mind and must be accepted for what they are and how they affect the success of the trader. Once that is accomplished, the trader can begin to take positive actions which can transform the outward reality and eventually reshape the internal, motivating feelings and negative thoughts.

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