With the election over, have we become more certain about the future? Probably not. This idea of uncertainty of the future is much higher now than three to five years ago. But was it easier to predict the future in 2017? Was “Is now the right time to buy?” a question that you asked in 2017?
No, of course not. The risks were still there but people were blind to them. The risks don’t change. It’s our complacency to these risks that change. I think a way to explain this is when there was good and accurate news, it gives us the impression that the future was predictable and uncertainty was low when in reality the future was extremely unpredictable, and complacency was high.
Considering constant bad news with the pandemic, the war in Ukraine, cash rate movements, and elections, it’s no wonder why our complacency to risks is much lower. We know now more than ever that what good times we have today could easily evaporate tomorrow.
With lower complacency towards potential risks, Could we expect to have a more realistic impression of the world and the future?
Perhaps.
The problem with less complacency is that it can be quite depressing or even pessimistic as people tend to shy away or even completely shut themselves away from making decisions until a level of certainty is regained.
As we have established in this short article, it’s not a level of certainty in the future that they are looking for, but an uplift in our complacency towards these risks in the unforeseeable future. The less we feel the likelihood of the risks coming to fruition the more risks we are likely to take.
What to do?
In Franz Kafka’s short story “The Burrow” (“Der Bau”) A mole-like creature creates a shelter and spends his life building a home to protect him from all kinds of unforeseeable dangers.
The shelter is very secure except for a hole that serves as an entranceway to the shelter. The creature could cover it but that would mean sealing off it’s only exit.
The hole threatens his life, but it also keeps him vigilant and ready. If the burrow were to be completely secure, the creature would waste away idly and in complacency, thinking that nothing will happen to it, but be ill-prepared when it does and therefore be placed at even greater risk.
It is the possibility of being killed and the uncertainty of the threat that will keep the creature alert.
It is the knowledge that the future is uncertain and that there are many risks that you will not see coming that should keep you alert and prepared for when they do come, you can react to them.
“Nothing is less safe than playing it safe”
Do you think that now is the right time to buy or sell?
Alexander Gibson