Remember not to panic in the face of adversity
I began this column many months ago by noting that I am an optimist, which must not be confused with 'happy'. If you have ever seen me on a Monday morning before my first cup of coffee, you will understand the difference.
Optimism is a key trait for many things related to how healthy you are and why some people survive layoffs, disease, bankruptcy, while others do not.
It is, in other words, a trait crucial to helping you survive a crisis.
Crisis is a loosely defined term but the one I - and perhaps any optimist - prefer is 'a decisive turning point'. In economic terms, crisis refers to a sharp downturn in a business cycle, essentially a plunge into recession. In personal terms, it's when X hits the fan.
How both the economy in general and you survive a crisis says much about whether you stay mired in recession and debt or rebound.
Remember, it was not too long ago that Hong Kong sank into several crises, beginning with the Asian currency freefall sparked exactly a decade ago last week, then the property freefall in the late 1990s and finally the severe acute respiratory syndrome crisis in 2003.
Yet if you walk around this city today, it is as if the place was unaffected by the calamities. For all the problems Hong Kong faces - and there are quite a few - there is still an air of optimism and energy in the city that everything will turn out just fine.
So what are the key ways to survive a crisis? Here are a few major ones:
1. Keeping your cool
The easiest way to make mistakes is to decide things in a panic. Emotion is never appropriate when making important decisions. This is not the same as making a split-second decision, which can be done with a clear head. In times of crises, when the stock market is plunging, when your property is in negative equity or when you've lost your job, take some time to think things through before making your next move. You won't regret it - ever.
2. Being realistic and adaptive
When Hong Kong property prices tumbled in the late 1990s - almost 70 per cent in many cases - Shih Wing-ching, founder of Centaline property brokerage company, made a few key decisions. One was to stay in the business no matter what. The other was to adapt. 'I repositioned our company,' the Shanghai-born businessman recalls. 'I gave up on my profit margin because I knew it would be unrealistic to maintain a profit. So I told my staff, our target is now to gain market share. I won't evaluate you on the money you earn, because it's impossible to earn any money right now, but on your ability to gain market share.'
That strategy paid off in the end with his agents aggressively pursuing business they might not have otherwise sought. Today, his company is bigger than before the property crash.
Crises are major turning points in any cycle and in our lives. It can derail your plans - whether it be saving for retirement or angling for a major promotion - but only if you let it.
On the other hand, while adapting to the change is key in surviving any crisis, never lose sight of your ultimate goal.
3. Jumping in when others jump out
Mr Shih did something else when things were at their most grim - he bought into a struggling rival called Ricacorp.
'When the boss of Ricacorp came to me for help, I was willing to invest,' he said. 'It's a good time to invest when most people are pessimistic. At that time, he was willing to cut the price.'
Jumping in when others are jumping out of the market may feel a bit like remaining on the Titanic after it hit the iceberg. But it is not.
A financial crisis, whether it be when the stock market is diving or property prices are plunging, often offers the best buying opportunities. Imagine how many people fled Hong Kong equities in 1997 after the October 23 fall. At the time, media reports used words like 'catastrophe', 'panic' and 'crash' to describe the stock market.
Ten years later, the Hang Seng Index has doubled in value.
4. Going with your gut feeling
Ask any successful person what is the secret to their success and he or she will tell you they have always listened to their 'gut' or their 'inner voice'.
We're not talking New Age loopy stuff, but just old-fashioned instinct honed from years of observation, failures, successes, knowledge and wisdom that keeps a person on track to his or her goal. This instinct is a powerful force when crises hit, helping guide you to the right decisions.
Entrepreneurs tend to be in better touch with their instincts primarily because starting any business from scratch requires gumption, which requires belief in one's goals and potential. Going with your gut can be the one thing that saves you in times of crises.
5. Keeping perspective
And finally, like any business cycle, there is a bottom to a crisis. It may not happen for a year, maybe many years. You may have crises hit one after another. But there is a bottom. The important thing is to remember the larger perspective.
When investing in the stock or property market, remember that your horizon is long-term - out 10, 20, even 30 years. A lot can change in that span of time.
When you lose a job, focus on the options available to you. Just think of how pessimistic people were in Hong Kong right before the handover. Some fled the city. Others moaned that Hong Kong would be overshadowed by Shanghai or Shenzhen.
Those who could see the wider potential of Hong Kong as part of a bigger, stronger China are now benefiting from that vision. They could see the big picture. And that is, in many ways, the root of true optimism.
Betty Liu is a correspondent for CNBC Asia in Hong Kong and author of Age Smart: Discovering the Fountain of Youth at Midlife and Beyond. She can be reached anytime at firstname.lastname@example.org .