The Loh Down On Science

Trading Testosterone

Cause of the erratic stock market? Hormones.

Finally, stock market crashes explained!

This is Sandra Tsing Loh with the Loh Down on Science,

saying, apparently, it's the testosterone!

So say University of Cambridge neuroscientists, who looked at possible links between mood and financial markets.

They went to a trading floor in London, and collected saliva samples twice a day--at the opening and closing bells--from seventeen male volunteers. They measured testosterone levels in the samples AND charted the traders daily success.

The results? High morning testosterone led to more end-of-the-day profit! And .. more end-of-the-day profit further boosted testosterone levels!

So what's the big picture? Testosterone, which inspires confidence and sharpens one's senses, creates a positive, feel-good/get-rich feedback loop.

But that's only half the story. The hormone also encourages risk-taking: So more of the stuff surging in the bloodstream makes you feel lucky! And when you're trading stocks and bonds, that combination spells CRASH.

In short, fluctuations in testosterone may cause cycles of irrational trading decisions, which may contribute to booms and busts.

Hence the secret to a stable economy? You guessed it, estrogen lovers, three words: Oprah


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