Both Sides of the Fence

A Tosa resident since 1991, Christine walks the dog, cooks but avoids housework, writes and reads, and enjoys the company of friends and strangers. Her job takes her around the state, learning about people's health. A Quaker (no, they don't wear blue hats or sell oatmeal or motor oil), she has been known to stand on both sides of the political and philosophic fence at the same time, which is very uncomfortable when you think about it. She writes about pretty much whatever stops in to visit her busy mind at the moment. One reader described her as "incredibly opinionated but not judgmental." That sounds like a good thing to strive for!

Must be that time of the market. . .

Economy, Wauwatosa

I’m playing with a new theory: one of the reasons Wauwatosa is such a sound and stable community is that for years now, it’s had a woman at the helm.

I can probably get put in jail for even suggesting that it’s men, mainly, who have gotten us into the pickles we’re in. So arrest me, but who usually makes (and unmakes) the rules, orders the troops, puts together the mortgage bundles and the deals, grows bald early trading on the market floors, collects the obscene bonuses, and floats gently on golden parachutes?

Thanks to Cambridge researcher and former Goldman-Sachs/Deustche Bank swaption and exotic derivative trader John M. Coates Sr, we now understand why men muck things up, at least in financial markets: mood swings.

Coates studies the role of the endocrine system and “endogenous steroids” -- self-made testosterone and cortisol -- in financial risk-taking. He tested steroid levels of actual London traders and published the results in the Proceedings of the National Academy of Science USA [105(16):6167-72]. “The waves of irrational exuberance and pessimism that destabilise the financial markets may be driven by naturally produced steroid hormones.”  Steroid homones in men, that is.

Apparently, men love competition, and when they are on a winning streak, they can get more . . . manly. And I don’t mean in the nicest possible, noble, sage, and women-and-children-first manly sort of way. The other one. You know: the swaggery, no-bullet-can-graze-me, make-my-day, high-testosterone sort of way.

But when things started going bad, the same guys get downright depressive. Negative is not a negative enough word to describe it. They just say “no” a lot. That’s cortisol talking, or rather demanding moody silence, there, son.

Coates noticed the phenomenon on the selling floor during the dot-com bubble/bust. The higher the market went, the more rash the traders’ decisions got, until they reached the point of stupidity. If we were talking about women, we’d call those bad decisions “mistakes.” Since we are talking about men, we call them “risk-taking.” The lower the market went, the lower the mood and the more irrationally fearful the decision-making became. This would be the “SELL!!” or flight side of the fight-or-flight response, I guess.

“Testosterone doesn’t create (market) bubbles,” Coates said, “but it exaggerates them. It’s possible that the bubbles are a male phenomenon.”

Women, are you surprised to read this? I thought not.

The solution to the hormone swing problem is not, Coates says, mucking around with steroid drugs and playing "tweak the testosterone." He doesn't say what the solution is. Even the most exciting research usually ends with the prim conclusion "more study is needed."

But I'll go where no self-respecting researcher dares to go: put women in charge. Our hormone issues are so very minor in comparison. And few people would outwardly object to a world that's more like Tosa than. . . East Timor, say. Or Wall Street.

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