Field of Science

Wondering why the markets have gone tits-up?

This in yesterday's Telegraph:
Jim Porter (not his real name), chief technical analyst for one of the largest banks in Britain ... uses heliocentric astrology to predict the direction of the international financial markets.

Millions of pounds' worth of commodities, shares and currencies are traded on his command. His decisions may affect the values of your pension and your home, and perhaps decide how long you hold on to your job.
It's hardly surprising that the world's markets are in turmoil, with chumps like this in charge! The problem is that markets are inherently unpredictable, and city analysts daily take high stakes gambles - with the success or failure largely outside of their control.

It's a profession where superstition is likely to thrive. Numerous studies show that supersitious behaviour increases alongside the 'desire for control'. As The Guardian has reported:
Ask a psychologist, a sociologist or an anthropologist what makes us superstitious - why we queue in market towns for tarot readings, why we fill in our lottery tickets with the same lucky ballpoint every time, and risk back injury avoiding the cracks between paving stones - and they will tell you the same thing. When people feel that they have no control over events, they will suspend their belief in the rational and step into a world where the rules seem more flexible.

Refs:

4 comments:

  1. "When people feel that they have no control over events, they will suspend their belief in the rational and step into a world where the rules seem more flexible."

    I believe that this is one reason that religion is so strong in the US. The lack of a social safety net makes people very exposed to the vagaries of the market. They respond by adopting (organised) superstitions and joining a church that may help them in adversity.

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  2. I think that's absolutely right. Religion helps by providing an emotional safety net, and church membership provides a practical one. Both factors drive religious affiliation. It's interesting, then, that religious affiliation is dropping in the US, same as elsewhere.

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  3. Good point. So either Americans are feeling more secure - which seems very unlikely - or it's the power of reason.

    Unless you see another possibility?

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  4. Probably one of the two! The Clinton generation are in their 20s now, and they're probably decidedly less religious than their parents. Then again, the 'new Atheists' are probably having some impact - shaking things up a bit. The impact of 911 - it probably turned a lot of people off religion. Lots of potential reasons.

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