Bitcoin Drama

Dear Reader, 

If you’ve been paying any attention to the news lately, then you’ve heard the recent raucous surrounding the rollercoaster that is cryptocurrencies. 

Are you confused by what you’re reading and hearing? 

Don’t worry, so are most people—even the ones who are investing in this digital currency. There’s so much buzz floating around about this phenomenon, it’s no wonder everyone is in a tizzy over its rising and falling prices.

One of the reasons so many people get burned in the stock market or cryptocurrency market is because they start buying as they see prices going up. Most of us remember the insanity of the dot-com bubble in the late 1990s. From 2000 and 2005, it was the real estate bubble. Today as I write, it’s gold, silver, Bitcoin, and Ethereum.

Once gold passed $1,800 an ounce and silver broke $23 an ounce, many of my friends came to me and said, “Oh, now I understand what you’ve been saying about gold and silver. Tell me where I can buy some.”

I’m afraid the only thing they understand is that the metals’ prices are going up, and as famed investor Warren Buffett says, “The dumbest reason in the world to buy a stock or gold, silver, oil, Barbie dolls, or Mickey Mantle cards is because the price is going up.”

One of the keywords Buffett often uses is the word understand. He says, “Investment must be rational. If you can’t understand it, don’t do it.”

Don’t get caught up in all the drama of an investment (GameStop investors, I’m looking at you), especially right now with Bitcoin soaring to new highs. 

You must understand first. Do not be an emotional investor. You want to invest in silver, get educated. You want to invest in Ethereum, get educated. So many investors spend more time researching which vacuum cleaner to buy than they spend researching their investing. 

Money Is Seen With The Mind, Not With The Eyes.

Here is one investing rule that I live by:  When emotions are high, intelligence is low. If I’m feeling like I’m getting caught up in the drama, I walk away. 

There are many people who are very smart mentally but are weak emotionally. For example, many school teachers are gifted with mental intelligence, but emotions, such as the fear of failing, often hold them back financially.

Another example of emotional intelligence is called delayed gratification. Many people want to get rich quickly. Working to get rich quick is a sign of low emotional intelligence. Those people cannot delay gratification. That is why I always say to get educated first. Not only is it making you financially intelligent, but it is also making you emotionally intelligent.

In 1983, Howard Gardner, a professor at the Harvard Graduate School of Education, published his book, “Frames of Mind: The Theory of Multiple Intelligences.” In the book, Gardner outlined seven intelligences.

Rather than look at intelligence in a narrow way like IQ does, Gardner proposed that people had different intelligences in which they excelled. People didn’t usually excel in just one intelligence but instead had multiple intelligences that they were strong in but also multiple intelligences that they weren’t strong in.

The following are Gardner’s Seven Intelligences.

  1. Verbal-linguistic
  2. Logical-mathematical
  3. Body-kinesthetic
  4. Spatial
  5. Musical
  6. Interpersonal
  7. Intrapersonal

Intrapersonal is the intelligence I’m talking about today. This intelligence is emotional intelligence. This intelligence deals with self-reflection and introspection.

Emotional intelligence refers to having a deep understanding of yourself, knowing your own strengths and weaknesses, and what makes you unique, with the ability to handle reactions and emotions.

Intrapersonal intelligence is crucial for high-stress environments, such as money and investing. In truth, intrapersonal intelligence is critical for success in almost any field or profession.

Intrapersonal intelligence is the one intelligence of success everyone must possess. Intrapersonal intelligence means communicating within yourself—being able to talk to yourself and control your emotions. For example, when someone who is angry says to himself, “Count to ten before you speak,” that person is exercising intrapersonal intelligence. In other words, he speaks to himself before he opens his mouth and lets his emotions speak. This intelligence is something you must cultivate to be a good, drama-free, investor. 

Intrapersonal intelligence is important for success, especially when times are tough, and a person wants to quit or is fearful. We all know people who are highly emotional. Rather than think logically, highly emotional people tend to let their emotions run their lives, often saying or doing something they may later regret. 

This inability to master the self leads to many struggles and heartaches for people, while those who put intrapersonal intelligence to work are some of the most successful people you know. More often than not, the emotionally intelligent investor profits handsomely from the ‘dramatic’ investor.

Three Parts of the Brain

Albert Einstein is credited with saying, “Imagination is more important than knowledge.”

As an entrepreneurial educator, I did a lot of research on the different parts of the brain. Boiling it all down to overly simplified terms, we have three basic parts to our brain.

The left brain is the part of the brain that is used for reading, writing, speaking, and logic. Kids who do well in school have well-developed left brains. From Gardner’s work on multiple intelligences, the left brain would be most associated with linguistic, logical-mathematical, and interpersonal intelligences. Writer, scientist, lawyer, accountant, and schoolteacher are professions for these people.

The right brain is the part of the brain that is often associated with pictures, art, music, and other more nonlinear relationships—with creativity and imagination. From Gardner’s work, musical and spatial intelligences would be most associated with the right brain. Designer, architect, and musician are professions for people with these dominant intelligences.

And finally, the subconscious brain. This is the most powerful of the three brains because it includes the “old brain,” often called the primitive brain. It’s the primitive brain and is most like an animal’s brain. It does not think but rather reacts, fights, flees, or freezes. From Gardner’s work, intrapersonal intelligence would most relate to the subconscious mind.

In my opinion, it is a person’s intrapersonal intelligence that ultimately determines if they are a success or failure in life, love, health, and money. This is because the subconscious mind is the most powerful part of the brain, especially in pressure situations.

People with high intrapersonal intelligence have the ability to control the subconscious brain’s desire to fight, flee, or freeze. Instead of flee, they may decide the best thing to do is freeze. If frozen, they |may choose to fight. The point is, they have the intelligence to choose the appropriate subconscious response. If angry, they can speak calmly. If afraid, they can confront their fear.

People think differently when their subconscious is controlled by fear. If people are fearful they may  say, “I can’t do that. What if I fail?” or “That’s risky.” Compare that to a person who is in a fight-state subconsciously, who might say, “I’ll show them. I’ll  get that deal just to prove I can do it.”

Learning to choose your subconscious state of mind before thinking and making decisions is very important.

Which Brain Controls Your Money?

Warren Buffett once said, “You have to think for yourself. It always amazes me how high-IQ people mindlessly imitate.” 

The reason I became curious about the brain and how it works is because I wondered why so many people say one thing and then do another. For example, I might ask a person, “Do you want to be rich?” Most people will say from their logical left brain, “Yes. I really want to be rich.” The problem is not found in their logical left brain. The problem is the subconscious brain’s saying, “Not you. You’ll never be rich,” or “How can you be rich, you don’t have any money.”

Words have emotional power. Those that cannot control their emotions will lose, while those who can control their greed, their fears, and the effects of emotions will be rewarded and profit.

Ask yourself, “Am I able to delay my gratification long enough to take the time to learn and gain some knowledge BEFORE I take action?”

Regards,

Robert Kiyosaki

Robert Kiyosaki
Editor, Rich Dad Poor Dad Daily

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Robert Kiyosaki

Robert Kiyosaki, author of bestseller Rich Dad Poor Dad as well as 25 others financial guide books, has spent his career working as a financial educator, entrepreneur, successful investor, real estate mogul, and motivational speaker, all while running the Rich Dad Company.

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