More Money Podcast - 376 Better Financial Decision-Making Through Mastering Confidence - Peter Atwater, Economist and Author of The Confidence Map

Episode Date: October 11, 2023

Why is it that often what's in the way of us achieving our financial goals and attaining wealth is ourselves? That's what I'm discussing with Peter Atwater, economics professor and author of , on the show today. After decades of working in financial services, when he turned 45 he abruptly quit his job (partially because his son reminded him he was halfway to 90) and changed course to study confidence and the impact it has on individual and group decision-making. Now, he's out with a book all about it in addition to teaching the topic at William & Mary University as well as the honors program at the University of Delaware. As we've discussed on the show before, money is simple but the hard part is controlling how it makes us feel. Luckily Peter offers some great insight into how to own those feelings so we can do a better job of reigning them in when we need to and make better financial decisions for the long-term. For full episode show notes visit: https://jessicamoorhouse.com/376 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hello, hello, hello, and welcome back to the More Money Podcast. I'm your host, Jessica Morehouse, and this is episode 376 of the show. And for anyone who is really into the psychology of money, the behaviors, and how really just like the emotional side of money, which is something that I'm very fascinated about, hence why I'm also kind of writing a book about it, you're going to love this episode. I've got Peter Atwater on the show who has an amazing book just come out, The Confidence Map, and he knows his stuff. Okay, let me give you a little bio because it's pretty incredible. So when he turned 45, his son said, Hey, Dad, you are halfway to 90, which is not cool. FYI, don't ever say that to someone who is 45. Or even if someone said that to me, even at 30, if someone said you're halfway to 60,

I wouldn't like that. So don't, don't ever say that. But anyways, that was a bit of a wake up call for him because three months later, he decided to leave his very successful career in financial services to do something very different. So after helping several hedge funds successfully navigate the banking crisis, that something turned out to be studying confidence. Tossing aside his academic training in economics and his experience on Wall Street, Peter turned to social psychology and discovered that not only do we act as we feel, but we do so consistently. So to paraphrase Mark Twain, history rhymes for a reason. I love that quote. And since making that big change to his career, Peter is now a recognized expert on the impact of confidence on individual and group decision

making. And he now teaches classes on that very topic at William and Mary, his alma mater, and for the honors program at the University of Delaware. And he's also, of course, a public speaker. And you can find him on Bloomberg Television and the Financial Times, Wall Street Journal, Time Magazine, all these great things. But I'm so excited to have him on the show because he has a brand new book called The Confidence Map, which we dive into because it is really special, really important stuff. And confidence is something that we need to talk more about when it comes to our finances. And he is the person to talk to because he really knows it all. So you are going to absolutely love this episode. So let's get to that interview. But before I get to that interview, I want to share a little bit more information about my

online course that you may not even know about, but it's been around for almost three years called Wealth Building Blueprint for Canadians. It's a course I built specifically with you Canadian listeners in mind who want to learn how to do passive investing like I've been talking about for years on the show. If you want to get rich slowly, invest for the long term, You don't want to day trade or dabble in something speculative like cryptocurrency or some hot stocks that you find online. You just want to make sure you can retire one day or save enough for buying a home. And this course can help you. It is specifically about all the fundamentals you need to know about investing as a Canadian. But then I also show you how to build a strategic investment plan and then how to invest in your own portfolio by way

of either using a robo-advisor or doing it on your own from scratch. There's lots of worksheets and calculators and spreadsheets that you will not find anywhere else on the internet, hence why I had to build them myself. But also get lifetime access as well as access to the private Facebook group, my monthly Q&A sessions for students, a private email you can contact me with, and you also get a private one-on-one session with me when you finish the course as well. There are so many benefits to the course, so I highly recommend going to jessicamorehouse.com slash course to find more information and to apply. Again, that's jessicamorehouse.com slash course to learn more and to apply.

Welcome, Peter, to the More Money Podcast. I'm thrilled to have you on the show. Thank you so much, Jessica. I'm glad to be here. Yes. So you just came out with your second book, The Confidence Map, charting a path from chaos to clarity, which I'm all, this is my realm. I'm very excited because confidence is a big, big topic when it comes to personal finance and investing. But before we kind of dive into some of the topics that you broach in your book, you have a very interesting background. And I love in your bio how you really kind of get to the point where it's like you turned 45 and you realized what am I kind of doing with my life,

which I'm like, oh gosh, I'm 37. Am I going to have that? I've had a lot of those moments in my life already. I guess they're just going to keep on coming. That's fine. But tell me a little bit about you. You worked on Wall Street. You were trained in economics. You know, what made you want to make a big change to now?

Now, you know, you're a teacher, you're a professor. You talk a lot. You teach a lot of people about, you know, things that you discuss in your book. What was, you know, what was the deciding factor of making this big pivot in your life? Yeah. So the deciding factor was my son telling me as I was blowing out my candles at age 45 that I was halfway to 90. That's not a nice thing to say after you blow out your candles. It's like you're halfway, you're almost dead. It's a thing. It's a happy birthday to me. Yeah. And so it became this sort of quest for how did I want to spend the second half of my life?

And the first half, as you mentioned, was very traditional. Your career in finance started on Wall Street right out of college, helped JP Morgan build its asset-backed securities business. And so I had a very classic finance career. And that was very helpful in understanding how markets work from the perspective of issuers and investors. But it really wasn't until the financial crisis in 2008 that I began to think about, so why do we do these bad things over and over? Why do bubbles happen? Why do bubbles happen?

Why does panic happen? And that's really how I've been spending the second half of my life, is looking at the relationship between how we feel and what we do, and trying to figure out, are there common elements that are useful for investors, for leaders, for individuals? And that's what I tried to put together for this book. I'm curious, because you've been in the field for so long, was some of your kind of curiosity about diving into that, just seeing these repetitions? It's kind of like every single, you know, 10 years, there's something or I'm curious what your thoughts were, especially

during the pandemic, when there was kind of the overall message, this time is different, even though they say that every single time, this time is different. But because it was a pandemic, and no one had experienced a global pandemic, since I guess the Spanish flu, everyone really thought this time is different. This is the zombie apocalypse. I'm curious what your thought process when you saw all this, especially with all of your backgrounds now, what were you thinking? So this is what's so interesting in my own life is during the 2008 crisis, as it got worse, I got more anxious along with everyone else. I was feeling that same end of the world feeling. In this one, with the pandemic, I actually got more and more excited about the opportunity

as more and more people panicked. And that's because having spent the time between 2008 and 2020 looking at human behavior, I learned that panic is God's way of telling us that the worst is behind us. Ooh, I like that. And so rather than getting wrapped up in it, we should be preparing for it to culminate in some sort of a capitulation. And that as investors, you want to be thinking about, so what do I want to buy? Because these are moments where your inclination is to sell everything when in fact, the best thing you can do is load up the truck and to buy. And I'm not saying in this case,

you needed to buy in March of 2020, but if you had just said, I'm now going to buy every week a little bit for the next several weeks, I know I'm not going to mark the bottom, but it didn't matter. Because what happens after these capitulation points is markets start to move substantially higher very quickly. And that's what I didn't understand in 2009 was everybody felt horrible, but the markets were going up dramatically. Yeah. If you just kept on doing your regular contributions or started investing in 2008, 2009, you would have been great if you just continued that. But like you said, there's even between 2008 and 2020,

there were so many little ups and downs and, you know, financial news being like this, another crash is happening every every five minutes, you know, it's hard to just stay put and to be rational when everyone else is irrational. I'm curious also what your thoughts were then because I saw a lot of panic. I heard a lot of stories of people even that I knew in my personal life who, you know, oh, I cashed out my RRSP or like, you know, like I sold all my investments inside my retirement account and I'm just going to wait for things to be safer. I'm like, that is the opposite of what you should be doing. But then there was a really quick turnaround when then people saw things go up very quickly and they're like, oh, now I'm going to buy. And then there was this crazy buying frenzy of it doesn't matter what people were like, should I buy crypto? Like I was getting DMs on Instagram, like, should I buy this crypto

coin? Or should I buy this ETF or this stock? And I'm like, whoa, what happened? This is the craziest turnaround. And also, this is, again, not what you should be doing. You shouldn't just be buying whatever's in the store, you should know what you're going to buy and why, right? Yeah. And and the fact that we were fact that we were stampeding into things that were incredibly futuristic, highly abstract, unexplainable, those are elements that we always see near peaks in the market. And I would say we've seen a similar modest peak with all of the AI frenzy in this past summer. It's very similar characteristics. It's all about possibility, the sense of unlimited possibility. And it's easy to get swept up in it because it feels good.

You see nothing but dollar signs ahead. And you need to realize that your imagination of the future is entirely a function of how you feel. It's a mirror. And we don't stop to say, oh, I'm seeing nothing but unicorns and rainbows ahead. I'm the one who's too confident because the picture I've painted is just too rosy. Yeah. Now, I know obviously a big focus of your book is confidence. And I liked at the beginning of the book you talk about there is a difference because I feel like we don't quite know what confidence is. I mean, that's why we should read your book. But the difference between self-esteem and confidence, because I do when I think about confidence, I do think inward, like it's a me problem.

Do you want to kind of talk about what is the difference and what exactly do you mean by confidence? Yeah. So there are three ways we use confidence. One is sort of the appearance of being confident. And I think of that as confidence theater. It's the act that we put on to look as if we have our act together. And that's a very popular thing in social media today. And business leaders do it, actors, athletes. There's a requirement to look like you have your act together before you get in front of an audience. And that, to me, is pure theater. There's the self-esteem piece, which is inward.

And here, that's interesting and maybe relevant, but as COVID showed, all of the self-esteem and self-confidence in the world didn't really help you when COVID hit. And so I've concluded that what confidence is about is our sense of certainty in terms of what's ahead. So do we think things feel predictable to us? And do we feel like we are prepared? Do we have a sense of control of the situation? Have we practiced, rehearsed, trained for the moments that are ahead?

And we need both of those to feel confident. And I think particularly for investors, it's important to recognize that the opposite of confidence is vulnerability. And so when you're anxious, when you're inclined to sell, it's because you think things ahead are uncertain or are dark, unknown, and you feel a sense of powerlessness. And just by monitoring that sense of certainty and control or confidence and vulnerability, you can avoid making your missteps. And as investors, we make our worst decisions at the extreme. We sell when we feel intensely vulnerable and we buy when we feel invulnerable. Yes. I think probably the hardest thing when it comes to confidence is even when you feel like

you find that confidence. And a couple of things. First, there's the worry that you'll become overconfident. And like you mentioned, that is where a lot of big mistakes happen. But also, how do you maintain that like balanced kind of level of confidence? Because it's hard to have that all the time. Like you're going to be vulnerable. You're going to feel powerless. You're going to feel overconfident. It's kind of a constant kind of shift. Yeah, and I don't think we should try to be, you know, to try to restrain our movement. I think we're better off realizing that we move, that real life moves us around, and that we can identify those feelings and by understanding them and appreciating them,

those feelings are telling us that we're overconfident or underconfident. And I think of things in terms of a triangular relationship between how we feel, the stories we tell, and what we do. Those are always in equilibrium. That if you told me the stories you are telling yourself, Jessica, I could give you a pretty good sense of how confident you are and in turn what you're likely to do. And so if we would only listen to our stories and even more the stories that are around us, those stories around us are telling us how the crowd feels. And I guess too, speaking of the crowd, we are so influenced with who we actually have in our

personal real life circle and then also the online circles that we're a part of. And that's why it was interesting, still interesting over the past few years though, with everything that's been going on in the market and even the real estate market and everything, how certain circles were very low confidence, some were overconfident. And it was interesting to kind of hop between them, because I like seeing what other people are talking about, to then figure out how do I feel and what do I want to take and what do I want to discard? It can be confusing, I think, to figure out which path is right, because everyone thinks they're right, like that it's the end of times or, no, this is the best opportunity. Take advantage.

Yeah. And I think that as an investor, the crowd feelings that matter are those of other investors. Your price is going to be a function of how others feel. And so here, watching the financial media, not to get involved in it and to get sucked in, but just to say, what are the stories that they're showing? Are they highlighting things that are futuristic or do we have some sort of markets and turmoil special? Because the financial media's business is to mirror back precisely how we feel. And I read the New York Times and the Wall Street Journal and the Financial Times every day to see what is the news, what's on the cover, because that's telling me what they as editors think is most resonant and relevant to us. And when it's very optimistic, it's expressing

how confident readers and watchers are. And when it's terribly pessimistic, it's telling us how dour investors' moods are. I'm curious, especially where you are at in your career and on your own journey, does the financial news affect you when you see those headlines? Or you are at in your career and on your own journey, does the financial news affect you when you see those headlines? Or you've got your strategy, you've got your kind of anchor, you know what to kind of dismiss and what to kind of take? Or do you just view the financial news being like, this is just a mirror. I'm going to just take that information for what it is. I take it for what it's worth. And then I try to see how extreme is the message. Because ultimately, the news becomes its own contrarian indicator.

And here, it's important to appreciate that the trend goes on long enough. And then there's the belief that it's unstoppable, that it has to keep going. And so very often we'll see it, major turning points, a sense that this company, this trend is unstoppable, that it's relentless. The adjectives just flow with a sense of power and momentum and forward push. And those are warning signs that we're getting very close to a turn. I always ask, does everybody now believe that? Yeah. And I guess, yeah, the other thing you mentioned being contrary, I know in behavioral finance, one of the things that I think humans have a hard time doing is going against their instincts because their instincts are going to honestly make them some really terrible mistakes. It is so hard looking at financial news or the sentiment

online where people are, yeah, very confident about what's going on the stock market. And you know, this is actually probably a better indication that I should be doing the opposite of what everyone's doing. Yeah. And if you can't do the opposite, don't do it. Yeah. So I always say to investors, if you cannot imagine another alternative than the one you have painted, don't do anything. Yeah. Because you're either believing of your story and the stories that are circulating around us. That sense of, I have to do this. I'd be an idiot not to do this.

You know, those are all expressions that are warning signs to just sit tight. Yeah. I mean, that's honestly usually the advice to give people. It's like, if you don't feel it, because everyone says, oh, buy low, sell high, it is very difficult to actually do that in practice. And even for me, it was impossible to get away

from just the anxiety that was going on in 2020. For me, I even hit pause on my investments just for a few weeks. And so it's like, I didn't catch up, but I just hit pause because I'm just like, I don't know if I'm going to like I'm self-employed. What if I stop making money? Maybe I need to preserve some cash. But then as things kind of regulated a little bit more, I'm like, OK, we're going to restart this. And then I just continue doing, you know, basically did nothing in terms of like changing my habits.

And sometimes doing nothing is the best thing you could do, but also very difficult, especially when someone is doing, everyone's doing things. You feel like you need to be doing something if you're not doing something that's bad. But like you said, sometimes doing nothing is the best thing that you can do for yourself. I want to kind of talk a little bit more specifically about building confidence. I know a lot of people that listen know, that listen to this show that I talked to, they're more in that low confidence kind of area in that, you know, maybe they're just starting to invest or they've been investing for a while, but you know, they've used

an advisor and they just didn't really know what they were doing. And now they're trying to learn a bit more and be more involved. And there's just a lack of confidence in their abilities, their knowledge, their skills, they think it's impossible. How can you just a lack of confidence in their abilities, their knowledge, their skills. They think it's impossible. How can you build a confidence to be a knowledgeable confidence? Because I tell people, I'm like, the best thing that you can do for yourself is to build your confidence. And some of that comes with experience, but it gets easier. But when you have no confidence, it feels like the biggest mountain to climb. Yeah. So I encourage people to think if you're going to begin investing and you are going to take control, so you're going to be the one behind the wheel.

Think about how did you prepare to get behind the wheel of a car? So you probably took a class, read a book. You learned the basic skills still not in the car. And then when you began, you drove slowly. You drove during the day. You drove with the radio off. You may have driven with somebody else in the car. And so as you begin, do it realizing that you're probably going to crash the car. You may get some dents. And so how big a risk should you be taking at the beginning?

And I think many investors oversize that initial strategy. They're like, I'm now in charge of my own destiny. And they get in the market today. And it's like, no, no, no. Make some mistakes. Learn how they feel. Learn what kind of driver you are behind the wheel. Realize that, again, your car is going to be bounced around by others on the highway. That this isn't just you on the road by yourself. This is you driving in a herd. And sometimes the traffic flows with you and sometimes the traffic is flowing against you. And you need to appreciate that you're not the only one on the road and they're going to sideswipe you some days. And some days, you know, the highway is going to seem really straight and clear. But realize too, that if you're in control and it goes poorly,

you're going to blame yourself. And blame is something we do because it explains, it provides an explanation. And we need to be less hard on ourselves when we take control of a situation and don't succeed the first time. And to not look at those setbacks as debilitating, but as learning experiences. And so, again, how do you size, how much failure are you willing to experience in this learning process? And I don't think investors tend to be willing to endure that learning process in a healthy way. From the director of The Greatest Showman comes the most original musical ever. I want to prove I can make it. Prove to who?

Everyone. So the story starts. Better Man. Now playing in select theaters. No, I mean, I know for a fact, just talking to so many people over the years that a lot of people, because I mean, as a society and especially like going through the school system, we are taught that failure is bad and we always strive for success. And even though it should be more framed, failure happens. It is natural. It is weird if you don't fail. But with that failure, that could be a really great learning lesson. But like you said, I think it's very difficult when it comes to investing because the investing world, it is all about show your successes. No one talks about the money they lost. No one talks about the bad trade that they made.

That's all quiet. You just hear about people's successes. And so you feel alone when you make a bad call or you make a poor decision instead of being like, hmm, this happened. Let's go through why it happened. What did I learn and how I can kind of prevent that in the future? I want to kind of talk about because you talk about feelings. And you know what? It's so funny that you mentioned that because especially in behavioral finance, it's all about don't feel you're supposed to be a robot. I mean, that is the best place to be is unemotional, but we are emotional creatures. And I love what you are kind of saying is that we need to actually feel those feelings, because they are going to help us control those decisions. You want to kind of explain that, like how we can

embrace those feelings, not let them drive? Like we don't want to be emotionally dysregulated. How can we feel those feelings and regulate those emotions so we can be better with our money? Yeah, I think rather than getting sucked into feelings, we should look at them objectively, almost like we do when, you know, I'm hot, I'm cold. It's like, yeah, I'm anxious, I'm vulnerable. And it's useful because those feelings are accompanying those feelings. There are predictable behaviors.

I know that if you're feeling vulnerable, you're likely to be investing in a way that is aimed at protecting you, that is taking risk away. And to appreciate that those feelings and actions go hand in hand. They're very predictable. And if you can't look at your own feelings subjectively, look at the crowd's feelings subjectively. You know, what are they saying? What are they doing? What is that saying about the degree of vulnerability or confidence the crowd is feeling? And if you think the crowd is getting ahead or, you know or is getting woefully overconfident, well, then those are the moments you should be preparing for a return to risk avoidance because that's always the way the cycle works. We go from overconfidence to panic to underconfidence to recovery. And this happens over and over and over. to panic, to underconfidence, to recovery.

And this happens over and over and over. I think it's powerful to look at the crowd, watch their behavior, almost like a scientist to say, oh, the crowd is panicking today. I know that when the crowd panics, the markets are approaching a major low because that is always what happens because panicked people sell. They do what they can to avoid the vulnerability. Eventually, that behavior exhausts. Everybody's done it. And that's the time to be preparing for a time of recovery. So instead of trying to like move with the crowd, you want to be one step ahead. And it's very easy, like you said, to actually do that because these are patterns that have repeated over and over. I'm sure it would be helpful to have some sort of like even just some sort of a guide

for yourself to be like, how am I feeling? Oh, anxious. Why am I feeling that way? Maybe it's either something that happened to you personally. It could be like, honestly, the interest rates game with the mortgages. Every time I see, oh, interest rates are up. Oh, my mortgage is up. I get anxious. And then what do I feel like doing? Usually there's an action that you want to do. And then you should be like, is that a good action to do or should inaction be the action or a different action? Like having some sort of mechanism where you can walk yourself through those.

That's what I do whenever there's a blip in the stock market is to be like, okay, let's just take a moment and feel and then think and then decide on an action. Or if there's no like totally emotionally dysregulated, let's not do anything. We can revisit that in the future. Yeah. One of the reasons I wrote my book is that it enables readers to map that journey of vulnerability and confidence and to actually put a point on a piece of paper to say, I feel like I'm here.

And once you do that, then my book provides all sorts of stories and actions that will likely accompany that spot. And so you can almost look at your own behavior going, yep, I'm doing that. I'm doing that. I'm doing that. And it's like, yeah, you are. Of course you are. Of course you are. And not being afraid of it, but just to, again, to look at your situation objectively and

to then say, to your point, if I am feeling vulnerable, what are ways that I can regain control, that I can regain certainty in my life, because both of those are very actionable. I can do specific things to reduce my level of vulnerability. And I'm a big believer that if we take the time to move beyond, I don't feel confident to, I don't feel confident to I don't feel in control. Well, then I can step back and say, well, what are some small steps I could take to feel more in control? And here again, Jessica, I would say small steps because our inclination is to be impulsive and highly emotional and to take really big steps to sell everything. And it's like, no, no, no. Just what are some small steps you can take?

I mean, I think it's hard. This makes sense. This is clear as day. Of course, this makes sense. But I think it's, again, difficult to put into practice because what are the images of investing and investing success that we see outwardly in the financial news and movies and TV shows on social media? It is like quick action instinct. Oh, I got this. It's not about taking a minute to see how do I feel? Do I feel confident or vulnerable? And then should I take certain small steps? But unfortunately, that's just I mean, that's why people make a lot of mistakes.

And certain people are, you know, just trying true and just, you know, take their time. I'm curious, what are some kind of actionable steps that you can share with people, some of those baby steps, if they are in a place of vulnerability to kind of get back to that place of feeling good and confident? Yeah. So often when we aren't feeling confident, it's a series of stacked vulnerabilities. And you could almost think of this as Maslow's hierarchy of need. What are the different ways that I feel vulnerable? Do I feel safe? Do I

feel financially able? Do I have food on the table? And to think about these in terms of priorities, because I have to make sure that I have my basic needs met in order, you know, before I should be worried about these more abstract needs. And I always encourage people to step back and to say, if you are feeling financially vulnerable and that is jeopardizing other elements of your well-being, then take risk off the table. You know, I work with an organization with their endowment in the healthcare space. And when COVID hit, they made a deliberate decision to reduce the risk exposure in their endowment because the risk of their business, they felt, was increasing.

And they said, we want one less thing to worry about. So if the market goes up or down, great, but I don't care. I just want to know that that's safe because all these other things are uncertain. And so I will often say to folks who have bought a house, reduce the risk in your investment portfolio for a little while, while you're learning to navigate this financial situation with your house. So that if a pipe bursts or the roof needs repairing and the market goes down, you're not like, oh, my whole world is going to hell at once. To think holistically about the ways that you are vulnerable and the ways that you might be vulnerable and to appreciate that your investment portfolio can serve as a way to take more risk and to take less risk.

And if you miss six months of the market, so be it. But during those six months, you may have had other experiences where you didn't need to also be worrying about the markets. I mean, yeah, I completely agree. I mean, that's why I talk about having an emergency fund all day long, because that is something that, you know, when I am in that kind of crisis mode, I'm like, but we were okay, because we've got this rainy day fund, if something happens, or even just like, you know, having life insurance, like it's, you know, maybe there's a big catastrophe that happened. You're like, it's okay, we've got a plan, we've got insurance, we've got some things in order. Having all of those other elements in

your overall financial plan handled, like you said, can lessen the worry. And I think sometimes we're just so focused on getting those returns, getting into the market, not missing out the FOMO and all that kind of stuff. You know, one way to feel confident and build that confidence with your investments is taking care of the other areas of your financial life that usually get ignored because they're boring. They're not as exciting as getting 20, 30% gains. It's like, get life insurance. Not as exciting. But what matters when real life hits? Yeah. No, absolutely. Absolutely. I'm curious, what was, I guess, the driving force behind this book? Why did you really want to, because there's so

many books out there about behavior, why did you really want to hone in on the idea of confidence? Was it something that you just saw and saw that this was not being talked about and it really should be? Because for me, I'm like, this is just ringing so many bells. This is really, really impactful. So I've been teaching a class on confidence and decision making for more than a decade. And in my class, we talk about the relationship between sort of broad levels of confidence and group decision making. So how's the crowd likely to behave if confidence rises and falls? And we look at financial decisions, economic decisions. We look at food choices, fashion choices.

I mean, we look at a lot of cultural and social trends. But what I learned in the years of teaching this class was that my students were taking these concepts and applying them to their own lives. That what we were talking about on a group level also applied at an individual level. And that the connections that they were making, I felt were connections that others could make

and could be helpful to them. Particularly today where there is the sense that the world is uncertain. And as I've said to my students, the world is always uncertain and always will be uncertain. But what changes is our feelings of the world. And so when we talk about the world being uncertain,

what we're really saying is I'm uncertain about the world. And so again, it's a story that is reflecting how we feel more than it is the reality around us. And I think today we have an epidemic of underconfidence of people who are seeing more uncertainty and feeling more powerlessness than the reality of the world suggests that maybe they should. The other thing that I have been seeing in it as we're talking about overconfidence is, especially when we're in a place of low confidence, we seek out people in the public sphere who seem to exude confidence, but usually it's over confidence. And then we try to, I don't know, by following them or ascribing to whatever they're saying or to invest how they think that we should invest, we feel like that is how we're going to build our confidence. And then usually what we discover is like, oh, they were full of crap or they were overconfident. Maybe I shouldn't have put all

of my eggs into that basket. Yeah. So when we feel especially vulnerable, there are five behaviors that we routinely exhibit. I call them the five Fs. Fight and flight, get all the attention. There's freeze, where we just feel overwhelmed and are powerless. The fourth one is follow, to your point. And follow is actually our easiest response to vulnerability. All we have to do is get in line. It doesn't require skill, strength,

tools. We don't need anything other than to get in line. And what we fail to appreciate is that predators, authoritarian leaders, cult figures, they love a vulnerable crowd. It's their praying ground. And so we need to be much more careful about who we follow in these moments, because what we'll find is that over time, we enter into a very abusive relationship with many of these figures where we never regain the control in our lives that we wanted. They'll make us feel like things are more certain, but the last thing they want is for us to take control. And so we really should be much more careful about those that we step behind when we're feeling vulnerable.

And then the last one, just to finish these up, is another F word that I probably can't say. But fight, flight, freeze, follow, and we're naturally nihilistic. And we need to remember that when confidence is low, we often sabotage ourselves, we sabotage others, we're not very well behaved when we don't think we're going to be rid of that vulnerability. So essentially, it's the, you know, what's the point? Why even bother? You know, just, yeah, hands up in the air. Or deliberately terroristic. And by that, do you mean not only sabotaging yourself, but sabotaging others potentially? Sure, sure.

Because again, if I'm feeling vulnerable, I will often associate blame with why I feel vulnerable. And if I can attribute it to others, then they become natural scapegoats for me. And yeah, I mean, I see that a lot too, especially during those times where, I mean, even now there's a lot of that with everything's so expensive, the cost of living crisis, interest rates, what have you.

A lot of people are like, who cares? I'm just gonna blow all my money because none of this matters anyway. And it's like, well, this is cyclical and there's gonna be a point where it will matter to you again and it's gonna be really really hard to make up for all that lost time, lost money for that time when you thought that the world is going to end. And like you said, the world has always been uncertain. But and one good thing about this world is like, this is still the best time, I think, to be alive when you compare it like I would not survive the Middle Ages, you know, I would not survive lots of those times. This is still probably the best time to be alive. It's not great. There's lots of problems.

But there's still more, you know, reasons to have hope. Yeah. I agree. Yeah. Well, I'm sure we can go on and on. And there's so many great things in your book. And I think it's a really important message to talk about confidence because we, yeah, we're definitely at a low point in confidence and we need to build that up so we can take control of our finances. And that's ultimately what the whole purpose of

this podcast is, is like, you can take control of your finances. You don't have to, yeah, just put your hands up and be like, ah, it's out of my hands. It's an unjust world. It is an unjust world, but you can still take control of lots of things. Yeah, we need to be as open to the potential that we're underconfident as we are to the potential that we're overconfident. Exactly, exactly. And this is a muscle that we can get stronger, and it takes time and patience, and I think that's really, really key. Where can people find more information about you or grab a copy of your book, The Confidence Map? So The Confidence Map is out and available through major booksellers or your local bookseller. I'm a big fan of the independent bookstores.

They can find out more about me at peteratwater.com. I'm also on social media on Twitter or now X at Peter underscore Atwater. It's a conversation, isn't it? Confidence Theater, yes. Yes, no kidding, no kidding. That's sort of who I was alluding to. I'm like, wow, that's some confidence theater if I ever saw it.

Oh my goodness. Well, thanks again for coming on the show and sharing all your wisdom. It was a pleasure having you and I can't wait for people to grab a copy of your book. Thank you so much, Jessica. I really appreciate the opportunity. And that was episode 376 with Peter Atwater. Make sure to find more information about him

at peteratwater.com. Also grab a copy of his new book, The Confidence Map, wherever you get books. I'm going to put a bunch of links in the show notes for this episode so you can find more information about him and where to find him and follow him and his other things that he's doing. He has another book that he put out before this, for example. If you just go to jessicamorehouse.com slash 376, that's where you can find all the information for that. And if you ever want to find information about an episode that you listen to, you can either go to jessicamorehouse.com slash podcast, or just go jessicam Morehouse.com slash whatever the number of that episode is. So make sure to do that Jessica Morehouse.com slash podcast, check it out.

I've got a few things to share with you. So do not go away because I've got some other stuff to share with you right now. Do you want to figure out where your money is going? Do you want to organize your finances once and for all? Do you want to feel less anxious about your money? Well, I have a great tool for you, my collection of budget spreadsheets, which you can find at jessicamorehouse.com slash shop. These new and improved budget spreadsheets have helped thousands of people over the years. And these are honestly the budget spreadsheets that me and my husband still use today. They come in Google Sheets and Excel. They also come with a comprehensive video tutorial to show you exactly how it works. And they're very easy to use. Not only that, I've got versions for pretty much any scenario. So if

you're an employee, I've got a budget spreadsheet for that. If you are self-employed, I've got a budget spreadsheet for that. If you're in a couple and one of you is an employee and one of you is self-employed, I've got a budget spreadsheet for that. I've got seven different budget spreadsheets for any kind of situation. So no matter what's going on in your life and your income, I've got a budget spreadsheet for you. So if you want to take action and see some progress with your finances, this is one really easy step that you can take right after listening to this episode. Just go to jessicamorehouse.com slash shop, find the right budget spreadsheet for you and then start making some moves that future you will be really, really thankful for. So as always, I am going to be giving a copy of his book away part of my big book giveaway that I've been doing for years now.

Actually, I can't even remember when I started this years and years and years ago. And if you just go to jessicamorehouse.com slash contest, you can find information on how to enter to win a copy of this book, The Confidence Map. But I'm also giving away copies of last week's guest, Eleanor Tucker. The book she has is Thanks for Sharing. And of course, my first episode of the season with Gabe Dunn, I'm giving away a copy of their book, Bad with Money. So make sure to go to jessicamorehouse.com slash contest to find more information about that. Now, one thing I want to just share in case you're interested, in case you work for an organization, a company, and they're looking for people for 2024, because I know things happen, you start booking now for the next year. If you're looking for a

speaker to do, you know, a talk or a lunch and learn or a workshop, I do those and I will have a little bit more free time in 2024 because I will just be in the editing process of my book, not actually writing a full blown book anymore. So if you're interested in doing that, I mean, talk to your whoever the powers that be at your organization. And I mean, you can either hit me up, I have an email Jessica at Jessica Morehouse.com. And then I can basically put them in touch with my agent who deals with all those things. But just want to put that out there in case you're wondering how, how can I see Jessica in the flesh. And since now we're no longer, I mean, also, I do virtual. But yeah, that's just an option. If you have, you know,

an organization that is looking for speakers about personal finance and financial literacy, I do that. And I will be booking more of those things in 2024. So that's just something I want to put out there. Other things I just want to remind you of is I do have a YouTube channel under my name, Jessica Morehouse. So check that out. And I also have an Instagram. I also got back on TikTok. I know I hate myself, but honestly, I don't really like live there. I like post and then I run away because I'm afraid of the crazies that are on there commenting. They're so mean sometimes. I can't even look at other people's TikTok comments. People are nasty. Instagram is just a little bit nicer to people,

I think maybe. I don't know. At least that's how I've experienced Instagram. But you can find me at Jessica I. Morehouse on Instagram. I'm also on threads because are we still there? Are we still there? I don't know. And the podcast also has an Instagram at More Money Podcast. If you just want to find out stuff about the podcast, you know, that's where I live as well. But, you know, follow me, you know, why not? It takes two seconds. I'm putting out lots more reels. I'm a lot of fun. You can DM me and I will try my best to, you know, answer whatever the heck you want. Man, the amount of time that I, yeah, I spend it wisely, I would say, but I do get a lot of DMs and a lot of specific questions. And I probably shouldn't, I would say, but I do get a lot of DMs and a lot of specific questions.

And I probably shouldn't, I don't know if other content creators do this, but like I get specific questions and I don't ever give advice over DMs, but I do Google and do some like resource chat. Like I do probably spend way too much time on these things. I should just tell people I don't know or Google it, but I can't help myself. I'm like, oh, here's a place that you can find. Yeah, so you can DM me, you know, and you don't even have to ask me a question. You could just say, hey, like what you're doing, keep going. I love a little perk up like that little something nice. That's always nice, too. All right, I have nothing else to share with you. So shout out to my podcast editor, Matt Rideout. As always, thanks for editing my show. Thank you for listening

to the show and supporting me and what I'm doing. And I will see you back here next Wednesday. Oh, yeah, I didn't even tell you who's gonna be on the show. I've got Manisha Thakur on the show. She's the author of the new book, Money Zen, which really is about the heart of money, the deep stuff, the underbelly of money, feelings, trauma, stuff that I know very well from research from my book. So you're going to love next week's interview. But yeah, that's my little teaser. That's who is coming on the show next Wednesday. So with that, have a good rest of your week and I will see you back here next Wednesday. this podcast is distributed by the women in media podcast network find out more at women in media.network