How Does the Stock Market Affect Our Mood?

The stock market and our moods are interconnected in an interesting way.  The stock market affects how investors feel, and in turn their feelings affect the markets.  In this way, the relationship between our mood and the stock market are a bidirectional one.  In fact, money and mood, and subsequently human behavior, are so intrinsically linked that an entire field of study called “behavioral finance” was developed to learn more about the interaction between money, mood and human behavior.

 

Our actions are intrinsically determined by the way we feel, and as such our emotions play a central role in our decision-making process.  Conversely, our feelings are often determined by external factors such as the economy.  Money is most certainly a mood changer.  It should not be surprising then that confidence in the United States economy is highly correlated with satisfaction of American’s personal life, which is one measurement of one’s mood.  For example, according to the results of Gallup’s Mood of the Nation Poll, over the past 30 years the lowest point of American life satisfaction was at 73% recorded in July 1979, which is when that year’s oil crisis took a heavy toll on American life.  There were also sharp dips in life satisfaction correlated with the market crashes of 1987 and 2008.

 

Conversely, Gallup reported that 90% of Americans are satisfied with their life currently, which is correlated with record stock market prices as well as other record economic indicators.  Some may argue that in recent years we have also witnessed high numbers of alcohol and drug addiction, depression, suicide, and other mental health issues.  It is important to recognize and acknowledge that money does not solve mental health problems.  Although there are higher rates of mental health issues among people of lower socioeconomic status, wealthy people also experience such issues despite having seven-plus figure bank accounts.  Such individuals may feel even more embarrassed or stigmatized about their issues when the old adage, that ‘money buys happiness,’ falls flat.  Nonetheless, individuals tend to experience lower moods during times of economic recession and depression.

 

It is not a coincidence that a sustained and severe economic downturn in an economy is coined with the term depression.  Whereas a mental health depression has a host of symptoms, an economic depression also has its own set of symptoms such as a rise in unemployment, reduction of trade and commerce, fall in credit, rise in bankruptcies, debt defaults, a devaluation and volatility of currency, a slowing of production and investment, and reduced trade and commerce.  A mental health depression includes symptoms such as fatigue or low energy, low mood, changes in sleep characterized by either insomnia or hypersomnia, changes in eating habits characterized by either overeating or undereating, changes in weight characterized by weight gain or weight loss, loss of pleasure in activities, feeling worthless, diminished ability to concentrate, and suicidal ideation.

 

Whereas an economic depression is different from a recession in that depressions are more severe and long-term than a slowdown in the course of a normal business cycle, a mental health diagnosis of depression also must be more severe and long-term than a low mood that is a natural part of a life cycle.  It is important to note that if anyone is experiencing a low mood and displaying signs and symptoms of depression, they should seek out professional help from a therapist as soon as possible.  Mental health professionals who are appropriate to treat depression include licensed therapists such as psychiatrists, psychologists, clinical social workers, or mental health counselors.

 

Just as New York City is filled with stock traders, brokers, investors and the like who are experienced and trained in financial matters, New York City is also filled with therapists and other professionals who are trained to treat depression and other mental health issues such as anxiety, bipolar disorder, substance abuse, or other addictions such as gambling addiction (and yes, gambling has many similarities to stock trading in the way that wins/losses impact neurochemicals in the brain).  A simple internet search is a great starting point to find a trained and experienced professional who can help you with your issues – “Wall Street therapist for depression,” “Upper East Side therapist for anxiety,” “Manhattan therapist for alcohol,” or other such specific online searches will help direct you.  Always do adequate research, read reviews, and schedule a phone consultation before deciding on a therapist.

 

For more information or to inquire about our private concierge services please contact our undisclosed office location in the Upper East Side of New York City today at (929) 220-2912.

Author
Lin Sternlicht & Aaron Sternlicht

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