Dr. Keith: Psyching Ourselves Out of Economic Trouble

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Markets move not just on financial realities, but on perception.Our hearts, not just minds, determine which stocks rise or fall, whether banks stay viable because we stay confident in them, or close because we rush to empty our accounts.

Now, more than ever, it seems the future depends on our collective optimism or collective pessimism about our standing in the world, the creativity and resourcefulness of our people, and the underlying strength of our financial institutions.

Here's the truth:We are in a better position than in recent memory to rely on our institutions as the delusions that created the housing bubble and propelled flawed investment banking strategies get wrung out of our system.The pain being endured by those who turned their personal finances or business financials into fiction is sure evidence that we are headed back to solid ground.

Make no mistake:The ground in America is still crisscrossed coast-to-coast by economic highways paved with gold.If you read the story of this nation from its first page to the page we are now turning, you will understand that tides have surged and retreated, but our riches have only grown.That predicts they will continue to, especially now that we are editing the fake stuff out of future chapters.

Here's how to use psychology to recover faster.It's called True Confidence, and it has a self-fulfilling force of its own:

-- Plan a trip, even if it's 12 months from now.

-- Put something you don't really need, but really want on your shopping list for Christmas - and buy it now.

-- Open a tiny stock account for your kids.

-- Start looking for a house that will make you happy; your income and prices will ultimately make your dream a reality.

-- Think about how to take your performance at work to the next level, as economic tides start to turn for the better.

Take note of the fact that with all the criticism of America, a Democratic African-American senator and a maverick Republican former-POW senator are squaring off to lead us to better times.We should be hopeful about that and everything it says about who we are and where we are headed.

This economy needed a detox from the intoxicants of false financials that made us euphoric.But it is an economy that turns out to be one that self-corrects, because it is ultimately based on market forces that have real and genuine power.

If America is a stock, believe me:People are going to buy again.Ladies and Gentlemen, start your engines.

Dr. Keith Ablow is a psychiatry correspondent for FOX News Channel and a New York Times bestselling author. His newest book, "Living the Truth: Transform Your Life through the Power of Insight and Honesty" has launched a new self-help movement. Check out Dr. Ablow's website at livingthetruth.com.