Nov 05 2008
Can We Blame the Bad Economy on Testosterone?
According to recent research, men with higher testosterone levels make riskier investments. Damn those hormone-intoxicated gorillas on Wall Street! They are why the U.S. economy is in the tank. Those legions of MBA-bearing apes that put billions into financial derivatives should have instead invested in Girl Scout cookie franchises, or perhaps stuffed greenbacks directly into the stuffing of their teddy-bears.
Certainly I can make a some sense out of this finding, with emphasis on the word, “make.” Yes, when a primate is struggling to attain or defend status, having a boost of aggressiveness and impulsivity is likely to help get the job done. There is risk, but in certain situations the reward is greater than the risk.
It terms of finances, it may be that males with higher testosterone levels don’t experience the same anxiety at the thought of risk, or are unable to inhibit the impulsiveness that otherwise would be. If testosterone had a motto it would likely be, “just go for it.”
That said, the validity of any finding does certainly not lay completely and perhaps not even substantially in the sense it seems to make. Historically speaking, truckloads of hypotheses and theories have made sense until further evidence came in. In those cases, you might say that the sense made was made up.
So before jumping to any sexy conclusion about this one finding, I’ll simply note it and maybe mumble to myself, “that’s interesting.” I’ll then await further research that could put the data into a clearer context.
P.S. I just realized that I must have off-the-chart testosterone levels. Why? My portfolio has ventured off the charts in the other direction. My funds were heavily allocated in small cap and emerging technology businesses.
Rather than high testosterone, maybe it was just stupidity.
