One of the most puzzling questions in neuroscience is the nature of emotions and their role in consciousness. The brain’s significant energy investment in maintaining the resting state indicates its essential role as the ground state of consciousness, the source of the sense of self. Emotions, the brain’s homeostatic master regulators, continuously measure and motivate the recovery of the psychological equilibrium. Moreover, perception’s information-energy exchange with the environment gives rise to a closed thermodynamic cycle, the reversible Carnot engine. The Carnot cycle forms an exothermic process; low entropy and reversible resting state turn the focus to the past, causing regret and remorse. The endothermic reversed Carnot cycle creates a high entropy resting state with irreversible activations generating novelty and intellect. We propose that the cycle’s direction represents psychological spin, where the endothermic cycle’s energy accumulation forms up-spin, and the energy-wasting exothermic cycle represents down-spin. Psychological spin corresponds to attitude, the determining factor in cognitive function and social life. By applying the Pauli exclusion principle for consciousness, we can explain the need for personal space and the formation of hierarchical social structures and animals’ territorial needs. Improving intuition about the brain’s intelligent computations may allow new treatments for mental diseases and novel applications in robotics and artificial intelligence.