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Trading Psychology and How The Mind Works, Part II

Continuing from where we last left off, here is part two from George. If you are enjoying these then I invite you to come join the forum discussion and elevate your trading to the next level.

You can find the Psychology and Money Management forum, which George moderates, here:

Trading Psychology and How The Mind Works (II)

All right guys, here comes part two!
The subconscious mind. The primitive mind. That's where the Holy Grail is
Well, how does is work then?

As mentioned before, it perceives about 40 million bits of information per second. That's huge. And it's never dormant. In fact it has been awake and recording since the time you were a fetus.

It's divided into three sub sections:

1. The Memory Mind. It has recorded all your memories, all events, actions, everything that ever happened in your life since the time you were a fetus. Think of it as a video camera with five senses. All of your memories, since ever are there and they are there constantly in every moment of your life.

2. The Emotional Mind. It's the part that contains all of your emotions. Whenever we act, react on an emotional basis, the subconscious mind is involved. Have you ever thought of that situation when you reacted so silly, and you asked yourself later, why in the whole world did I react like that, or why did I say that? It's because of the emotive information that's stored in your subconscious mind. Remember, what was in the conscious mind. Those two sub minds are not involved then -the rational, and the analytical mind-.

3. The Protective Mind. It has the role of protecting you against what it perceives as dangerous. Let me give you the classical example of why people starts smoking in order to explain the protective part.
One of our primary needs is the need of security. When we become about, 13-14 years of age, we start to flirt very much with what's outside of our home. Our parents are not that cool anymore. The gang, the group is more important, so we start to flirt with the group. Now, in order to get in the group we have to be accepted. If the group is smoking, and we don't, we've got a problem. We start to feel insecure, because we've put our security outside of ourselves, it's in the group.

So we start smoking, and the group accepts us. Even if it tastes bad, and we're very well informed about the dangers, we get our needs of security fulfilled. The protective part has done it's job and has led into a situation in order to make us feel safe. We belong to the group.

This example can actually be translated into many situations that has to do with belonging, groups, and actions that are against our "own free" will.

It actually has one more role, it's the lazy mind. Think of it as a playing device that has recorded something and it's playing it all over again. It refuses to accept new information. Whenever new information is send to it, it does a check. Say that I make the decision of, let's say start jogging every morning at 5.00 am. It takes in the information, does an analysis, chews it, and spits it out, saying; Nope, we don't recognize that idea, thought. We haven't done that before, and there's no place for something that's bothering our protective laziness.

So, it's a playing device that's playing every event that you've experienced in your life, from the time you were a fetus, til your present moment.

It's basis is created from day 0 of your life til the age of about 7. That's because, your brain waves, in that period are in a kind of hypnotic state. They move very slowly, and your whole subconscious is very much completely open. You lack the critical factor, (-analytical and rational mind).

And that means that every litle thing that's put there, not that it stays there, but it creates the fundamentals of your character, and your outcomes in life.

Who's putting in the information? Well, most of it comes from our parents. They are the ones in charge of our lives. Let me give you an example in order to clarify it more.

Remember I told you that, one of our basic needs is the need for security. Normally, when a baby starts crying, it is taken up by the mother, it continues to cry. The mother checks the diaper, changes it. The baby keeps on crying. The last step, -the one that always works-, is to bring the baby to the bosom, and stick a bottle in its mouth or feed it with breast milk.

That's when the baby finally stops crying.

What's actually happening? The need for security is fulfilled. Being brought up to the bosom, the baby, feels the warmth and care from the mother and the need for security is fulfilled. The only problem, is that it creates an association. The brain creates that association to food. In other words, when I get food, then I'm secure.

You grow up, and every time, you had a stressed day, you feel depressed, etc. etc. You find yourself putting something in your mouth. If you start to abuse food, you give birth to obesity!
But remember it has to do with the need of fulfilling ones security.

This is just one example. Other quick examples are, those very classical as well. Just think of how many parents out there are telling their children, things like "you're not worthy", "you can't do that", "you're bad", "you'll never be able to" etc., etc..

You guys get it now?! How many of those thoughts, are you own? I confess, they're part of my package all. And I believe I'm pretty normal.

So those thoughts are not even put there by ourselves. They're put there by our parents and by society. Free will ha?!

Just take a look at your internal self talk! If you're being honest to yourself you gone find them there. And you gone notice that you are just as bad to yourself as your parents were to you.

I have to mention that, we do have the contrary picture as well, and that contains a very nice self talk, which is there because of that nice program instead.

Does the picture start to take shape now!?

In summation of all this. It's pretty basic now, right? The real us, is our subconscious mind, because we're spending there about 95% of our daily lives. The subconscious mind is this device playing on and on the program we got, in there. The program is put there by our parents and by society.
What does all this has to do with trading then?

We'll get to that in the next article.

Till then trade well, and may the Trend Gods be with you all!


To be continued...


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