Empathy

One of the greatest gifts we humans as organisms have is the human mind. It is different from what other species have because of the variety of tasks it is capable of pulling in a short time. One of those capabilities we have is the feeling that we experience largely due to the ability our emotions provide us. To feel happy, sad, joy, fear, greed, etc. is a virtue we fail to acknowledge at times and take it for granted. Imagine what would you do if you wake up one day and are unable to feel any of these. This would take away the gift of life.

To make this simple imagine this -we work so that we spend our time doing something productive in return to feel good about ourselves and earn so that we can buy things, in turn, to make us feel good or give us comfort which again is to make us feel good. Now if you can’t feel good what would be your motivation to do anything in life?

We spoke about the feelings that we go through and we understand them very well because we have the first-hand experience of them. Now, what about how others feel due to our action/ inaction or due to dire circumstances they go through? We have the ability to understand and feel that too- yes that is Empathy. I am sure most of us have already felt this and even know about it yet we fail to be empathetic towards others which usually leads to more problems that could simply be avoided.

Let’s see what google says about empathy “the ability to understand and share the feelings of another”. Isn’t this another virtue that we are blessed of as humans to be able to feel pain or joy of others and share it with them? We are labeled as social animals because we can’t survive for long without being a part of society (pick up the history of humankind and see how many were able to survive alone).

Imagine how good or comfortable you would feel if people understood you the way you would want them to? Only if we extend the same to them, we can reduce a lot of suffering to mankind. The thing is empathy is neither taught to us in schools nor by our parents at home (yes, they teach us sharing is caring but that’s not enough) we learn most of it by observing people around us. If you are lucky to be surrounded by people who extend this virtue to you, you would learn and in turn share it with others. It has a chain reaction and most likely adds to your karma account. It doesn’t cost you much to be a little more understanding and a little more empathetic towards people.

One of the most prolific writers in the investing community Morgan Housel writes in the most recent piece on his blog Collaborative Fund to ask this question instead of why wouldn’t you agree with me “What have you experienced that I haven’t that would make you believe what you do? And would I think about the world like you do if I experienced what you have?”. Imagine if we start seeing the world this way how much better we can make this place of ourselves to live in?

Lastly connecting this to investing world one of the most important things while investing in direct equities aka companies is the management. What would be better than a person being able to put himself in the shoes of the CEO and try to understand why did he take a particular decision and decide whether to invest in the company or not? Having empathy would give you multiple perspectives and ways to think& understand better about businesses.