If you watch the news, the first headline tends to be fear or something – natural disaster, political, health, family concern. It is there because we all have fears, for we are human, but can we understand them? In the book Risk – The Science and Politics of Fear by Dan Gardner published by M&S Toronto, 2008 the answer is yes we can understand them.

Mr. Gardner points out Fear has two minds – natural selection and mutation Natural selection favors traits that help an organism survive and reproduce, while slowly weeding out those traits that hinder our survival and reproduction.

Mutation is genetic mutation which institutionalizes the natural selection. The line between what is positive and negative is never clear, with the classic example of sickle cell anemia . The positive is it boosts the child’s resistance to malaria. The negative is if the child has the DNA from both parents, they are likely to die before adolescence.

Our brain develops over the years based on the survival aspect is the Law of Similarity. Appearance equals reality or you may have the saying it is walks like a duck and quacks like a duck, it is a duck. This evolves into 2 systems of thought: System One is the intuitive, quick, and emotional. System 2 is the calculating, slow and rational. Mr. Gardner uses the terms Gut and Head. You like said or heard someone say I have a Gut Feeling which means I have a vague sense that something is true but it is hard to explain. The second expression you have likely heard is Use your Head – stop and think about it before acting.

The interesting and complex aspect is the two systems work semi-independently of each other. The two systems overlap which can be a great thing. We do something such as the 10,000 hours theory and we become good at it. We use both systems. The negative side is to move the public to an action or inaction, advertisers focus on one system or another.

Linking to dividend paying stocks, one of the offerings of a mutual fund is called a Balanced Fund and similar to balance we need in our lives. In general, the world most of us live in has never been better to live in despite of ongoing concerns. Think about the good things in life – receiving a dividend and it growing on a regular basis. Investing is about managing risk and lowering the risk is focus of buying profitable companies.

There are more questions than answers, till the next time – to raising questions.