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THE HOUR BETWEEN DOG AND WOLF

Name: THE HOUR BETWEEN DOG AND WOLF
Author: John Coates
ISBN: 978-1-59420-338-1

RISK TAKING, GUT FEELINGS, AND THE BIOLOGY OF BOOM AND BUST

by John Coates ‧ RELEASE DATE: June 18, 2012

Well-presented and intriguing.

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An in-depth look at how financial risk-taking is linked to human biology, especially to the testosterone levels of young male traders, and the implications of this phenomenon for financial markets and the wider economy.

Coates, who has a doctorate in neuroscience from the University of Cambridge and spent years as a trader at Goldman Sachs, Merrill Lynch, and Deutsche Bank, brings an educated, experienced eye to this examination of the biological side of the financial markets. In his view, the waves of irrational exuberance and pessimism that exaggerate bull and bear markets may be driven by physiological changes. The author has monitored the endocrine and autonomic nervous systems of traders in London to learn how physiological systems affect moods and behavior in competitive and risk-taking situations. When young male traders make money, their testosterone levels rise, and this chemical hit turbocharges their confidence and their level of risk-taking. Coates warns that overconfidence and overreaching lead to a bubble followed by a crash, and the stress response to a crash is a rise in another hormone, cortisol, leading to anxiety, fear and pessimism. The author also takes readers inside the brain, citing scientific research that explains how the brain and body work together, how gut feelings affect thinking, and how we might become physiologically more resilient to stress. Finally, the author suggests steps that banks and fund managers might take to manage the biology of risk takers—and thus keep them from turning from dog to aggressive, dangerous wolf. Among these are changing the year-end bonus system and reining in hot traders with mandatory cooling-off periods. Not surprisingly, another is to broaden trader demographics—i.e., hire more women and more older men. Generally, Coates uses concrete examples to make understandable both the financial and neurological complexities that are central to his argument.

Well-presented and intriguing.

Pub Date: June 18, 2012

ISBN: 978-1-59420-338-1

Page Count: 368

Publisher: Penguin Press

Review Posted Online: May 6, 2012

Kirkus Reviews Issue: May 15, 2012

Categories:

BUSINESS | LEADERSHIP, MANAGEMENT & COMMUNICATION | GENERAL BUSINESS

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THE CULTURE MAP

BREAKING THROUGH THE INVISIBLE BOUNDARIES OF GLOBAL BUSINESS

by Erin Meyer ‧ RELEASE DATE: May 27, 2014

These are not hard and fast rules, but Meyer delivers important reading for those engaged in international business.

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A helpful guide to working effectively with people from other cultures.

“The sad truth is that the vast majority of managers who conduct business internationally have little understanding about how culture is impacting their work,” writes Meyer, a professor at INSEAD, an international business school. Yet they face a wider array of work styles than ever before in dealing with clients, suppliers and colleagues from around the world. When is it best to speak or stay quiet? What is the role of the leader in the room? When working with foreign business people, failing to take cultural differences into account can lead to frustration, misunderstanding or worse. Based on research and her experiences teaching cross-cultural behaviors to executive students, the author examines a handful of key areas. Among others, they include communicating (Anglo-Saxons are explicit; Asians communicate implicitly, requiring listeners to read between the lines), developing a sense of trust (Brazilians do it over long lunches), and decision-making (Germans rely on consensus, Americans on one decider). In each area, the author provides a “culture map scale” that positions behaviors in more than 20 countries along a continuum, allowing readers to anticipate the preferences of individuals from a particular country: Do they like direct or indirect negative feedback? Are they rigid or flexible regarding deadlines? Do they favor verbal or written commitments? And so on. Meyer discusses managers who have faced perplexing situations, such as knowledgeable team members who fail to speak up in meetings or Indians who offer a puzzling half-shake, half-nod of the head. Cultural differences—not personality quirks—are the motivating factors behind many behavioral styles. Depending on our cultures, we understand the world in a particular way, find certain arguments persuasive or lacking merit, and consider some ways of making decisions or measuring time natural and others quite strange.

These are not hard and fast rules, but Meyer delivers important reading for those engaged in international business.

Pub Date: May 27, 2014

ISBN: 978-1-61039-250-1

Page Count: 288

Publisher: PublicAffairs

Review Posted Online: April 15, 2014

Kirkus Reviews Issue: May 1, 2014

Categories:

BUSINESS | PSYCHOLOGY

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THINKING, FAST AND SLOW

by Daniel Kahneman ‧ RELEASE DATE: Nov. 1, 2011

Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our...

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A psychologist and Nobel Prize winner summarizes and synthesizes the recent decades of research on intuition and systematic thinking.

The author of several scholarly texts, Kahneman (Emeritus Psychology and Public Affairs/Princeton Univ.) now offers general readers not just the findings of psychological research but also a better understanding of how research questions arise and how scholars systematically frame and answer them. He begins with the distinction between System 1 and System 2 mental operations, the former referring to quick, automatic thought, the latter to more effortful, overt thinking. We rely heavily, writes, on System 1, resorting to the higher-energy System 2 only when we need or want to. Kahneman continually refers to System 2 as “lazy”: We don’t want to think rigorously about something. The author then explores the nuances of our two-system minds, showing how they perform in various situations. Psychological experiments have repeatedly revealed that our intuitions are generally wrong, that our assessments are based on biases and that our System 1 hates doubt and despises ambiguity. Kahneman largely avoids jargon; when he does use some (“heuristics,” for example), he argues that such terms really ought to join our everyday vocabulary. He reviews many fundamental concepts in psychology and statistics (regression to the mean, the narrative fallacy, the optimistic bias), showing how they relate to his overall concerns about how we think and why we make the decisions that we do. Some of the later chapters (dealing with risk-taking and statistics and probabilities) are denser than others (some readers may resent such demands on System 2!), but the passages that deal with the economic and political implications of the research are gripping.

Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our minds.