Hormones such as testosterone are responsible for driving young male traders to take increasingly ill-calculated risks that turn bull markets into bubbles and even financial crises, according to neuroscientist and former Wall Street trader John Coates.
Coates, who is now a Senior research fellow in Neuroscience and Finance at Cambridge University, told the audience at DLD Women that biology had a major contribution to the global financial crisis. He said: "Every blow-up in a bank of $1 billion or more occurs at the hands of a trader at the end of a multi-year winning streak. You become euphoric, delusional and overconfident. You take way too much risk and there are terrible risk-reward trade-offs."
By: Olivia Solon, Edited by: Nate Lanxon
Continue reading...Source: http://www.wired.co.uk/news/archive/2012-07/13/testosterone-financial-crisis
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