Yo! I’m sharing a (longer) excerpt from my forthcoming book, FINANCE FOR THE PEOPLE. It’s a story I found while researching the making of modern consumerism. When I learned this story, my mind was blown – which is one of my favorite feelings in the world. I hope you get that same feeling and I hope you’ll pre-order my book. Sigmund Freud was an Austrian neurologist and founder of the practice of psychoanalysis, a method to treat mental illness and to understand human behavior. Freud postulated that events and experiences we had during early development greatly shape our personality and influence our adult lives. He believed the brain had various layers of consciousness— the conscious mind, the subconscious and the unconscious. He believed that human behaviors, which we might believe are motivated by conscious, rational choices, are often motivated by our subconscious and unconscious minds. Edward Bernays, Freud’s nephew, was the first person to use Freud’s ideas about humanity to manipulate the masses through what we now know as modern marketing and advertising. He got his start during World War I, using media to help the Woodrow Wilson administration promote the U.S. war effort at home and abroad. After attending the peace conference at the end of the war, Bernays saw firsthand how effective propaganda was and wondered how it might be used to control and manipulate the masses during peacetime. When he got back to America, he established a company that would create propaganda, which he renamed as “public relations.” Bernays, using his uncle’s insights, developed an approach he named “engineering consent.” It was based on the idea that it’s possible to manipulate people through their unconscious, irrational emotions and influence them to behave in a certain way. He sold the means to “control and regiment the masses according to our will without their knowing about it.” Bernays thought that irrelevant objects could create symbols for how you want people to see you; that it was possible to get people to act irrationally if you link products to their emotional desires and feelings. Prior to the large-scale adoption of this kind of advertising, most forms of marketing were focused on the practicality of the product’s features. Bernays’s approach appealed not to what you need but what you unconsciously desire. It’s not that you think you need that new piece of clothing, it’s that you’ll feel better with that new piece of clothing. One of the most notable and successful campaigns Bernays produced was a demonstration at the 1929 Easter Parade in New York City. He had been approached by George W. Hill, president of the American Tobacco Company, to solve the problem of getting women to smoke on the street as opposed to only indoors. Bernays looked to psychological theories and consulted with the psychiatrist A. A. Brill, a pupil of Sigmund Freud, asking him what the psychological basis was for a woman’s desire to smoke. Brill advised that cigarettes symbolized men and smoking them was a way to feel equal to a man. Cigarettes were about freedom and equality. So Bernays staged a dramatic public display of women smoking during the Easter Parade and told the press to expect woman suffragists to be lighting “torches of freedom.” The next day, on April 1, 1929, the front page of the New York Times read “Group of Girls Puff at Cigarettes as a Gesture of ‘Freedom’.” And the rest is, as they say, history. After that successful stunt, corporations began to follow suit and Wall Street soon after. A leading Wall Street banker Paul Mauzr of Lehman Brothers said in a 1927 issue of Harvard Business Review, “We must shift America from a needs, to a desires culture. People must be trained to desire, to want new things, even before the old had been entirely consumed. We must shape a new mentality in America. Man’s desires must overshadow his needs.” This cultural shift led to a boom in consumption that created a stock market boom of which Bernays was also directly involved in by crafting the idea that regular people should own stocks and shares. Corporations craft modern marketing messaging based on psychological theories of how our minds quietly deceive us. We are being manipulated to make irrational decisions to buy things we do not need, to spend money we could be saving, to go into debt even when we know it’s not in our best interests. These messages driving us to consume are inescapable and appeal to our emotions and minds in ways most people are unaware of. It’s hard to believe this story because it seems so blatantly deceitful. But the American economy is so strong precisely because of the insatiable desire of the consumer to consume. This one thing alone makes us weird about money, but of course, it’s just one of many invisible factors. Your favorite finance friend,
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1. 💸 How to Get a Grip on Your Spending (HYG Original) 2. 💁♀️ Why Simply Hustling Harder Won't Help You With the Big Problems in Life (GQ) 3. 👶 After the Beanie Baby bubble burst (Vox) 4. 🤓 A bookkeeping thing - What is Cash Flow Forecasting, Why It Matters and How to Do It (HYG Original by Paco) 5. 💪 Sharing Hard-Won Money Lessons to Build Generational Wealth (New York Times) “Ms. Wamala is especially eager to work with people of color and other first-generation immigrants, because in her view, the mind-set many people grew up with can be limiting. ‘There is trauma around money,’ she said.” 6. 👩🏫 The Second Coming of Guru Jagat (Vanity Fair) “As a culture, we are currently obsessed with cults; there is a kind of perverse admiration for their leaders, whose success hinges on the same qualities that make tech entrepreneurs billionaires overnight. Both camps peddle an if-you-can-believe-it-you-can-achieve-it philosophy that we, a generation raised on late capitalism and faux meritocracy, can’t help but glug down like orange-flavored LaCroix.” 7. 🤴 My Bizarre Reign as New York’s King of “Virgin Russian Hair” (Narratively) “Complete strangers wiring me $15k on the spot, smuggling blond ponytails across the Atlantic, secret rendezvous under the overpass — I just may have had the weirdest side hustle of all time.”8. 🤭 A TikToker Made $200,000 Farting In Jars. Here's How She Did It (Rolling Stones) “People really like the idea of spending an exorbitant amount of money and kind of being — I don’t want to say ‘swindled,’ but it’s like a financial domination thing for a lot of men.” Editor’s note: I’ve never laughed harder reading an article that was intended for this newsletter. I will never apologize for loving and laughing at bathroom humor. I’m not above it.
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🎉 I’m going to be appearing on Good Morning America on Monday, January 31 at 7:15a PT to promote FINANCE FOR THE PEOPLE.
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🤓 Did you hear? We're offering a portion of our classified ad space to newly created, not-yet-profitable, BIPOC, or female-identifying owners through 2021 free-of-charge to our subscriber community. Do you have a project or business that could use a boost during these weird times? Let us know about it, and we'll schedule it to appear in The Nerdletter. 🤓
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