Does the aggregate level of self discipline within an economy play a role in our economic stability, or more specifically—does it determine the extent to which our economy will be able to recover from a crash? Some leading economists seem to think so—I agree. Dr. Brian Knutson a Stanford Psychologist has published a number of articles that have linked the idea of us receiving a large sum of money, to stimulating the same emotional sensors of the brain that sex and drugs activate. In other words—money and the idea of consumption is a very powerful stimulus. His work is helping financial planners better understand how to consult their clients; how casinos can take advantage of individual’s emotions to increase profit and the like. The idea that emotion affects our financial decisions is nothing new and seems almost common sense, but what if those at the lower income brackets all overspend and refuse to live within their means? Dr. Steven Gjerstand’s (a Nobel Peace Prize recipient) article hypothesizes that excessive consumer debt is the differentiating factor present when our financial markets crash and have a difficult time rebounding. If his hypothesis is correct, we may be in a world of hurt. Remember, Dr. Knutson has linked our response to money as being on the same level as some incredibly powerful stimuli (drugs and sex)—as long as liquidity is available to the undisciplined, consumer debt will continue to grow and increasingly violent market corrections will, hopefully sooner than later, beat us and our government into living within our means. In the mean time, small businesses lack liquidity and in most cases need credit to achieve a scalable system. Only time will tell how markets and regulators will respond, but make no mistake—self discipline is a variable we must reconcile with.