The Hour Between Dog and Wolf: Risk-taking, Gut Feelings and the Biology of Boom and Bust

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In this time of financial crisis, a brilliant new perspective on the irrational behaviour that dominates the trading floor and its ramifications for the rest of us.
Neuroscientist and former Wall Street trader John Coates here explains how we think with our body as well as our brain; when we take risks at work, in sport, on the battlefield, and the financial markets. Could the biological responses to making and losing money trigger the extreme reactions that regularly destabilise the global economy

In a series of groundbreaking experiments, Coates shows that under the pressure of risk we biologically transform, a metamorphosis he refers to as the hour between dog and wolf. Traders are especially prone; testosterone-driven when winning, tentative when cowering from losses.

Drawing on recent research, Coates looks at how our bodies produce the gut feelings we often rely on and how sports science can teach us to overcome stress. The Hour Between Dog and Wolf comprehensively reveals the biology behind bubbles and crashes.

Reviews

This brilliant book shows how human biology contributes to the alternating cycles of irrational exuberance and pessimism that destabilise banks and the global economy and how the system could be calmed down by applying biological principles Should be top of the summer reading list for Jamie Dimon, chief executive of JPMorgan, and anyone else wondering why traders so often get banks into trouble Financial Times

This stunning book should be compulsory reading for anyone concerned about the behaviour of those involved in the lying and manipulation of those involved in the lying and manipulation of successive banking scandals Mail on Sunday

If Coates is right- the evidence he presents is compelling- then the financial; crises that so frequently plague capitalism find their roots in human biology New Scientist Magazine

The picture of humans as rational economic machines has gone down the tubes. This book looks at the biology of why Homo economicus is a myth, and no one is better positioned to write this than Coates he is a neuroscientist and an economist and an ex-Wall Street trader and a spectacular writer. A superb book Robert Sapolsky, Professor of Neurology, Stanford University, and author of Why Zebras Don't Get Ulcers

A terrific read better than any amount of economic analysis because it explains what lies at the root of economic disaster those biological drivers that cause sane and clever people to make catastrophic decisions. Every banker should be made to read it! Rita Carter, author of Mapping the Mind

It makes intuitive sense that biological responses inform the mood of the markets. This book puts flesh on that idea Economist

Author Bio

John Coates is a senior research fellow in neuroscience and finance at the University of Cambridge. He previously worked on Wall Street for Goldman Sachs, and ran a trading desk for Deutsche Bank. In 2004 he returned to Cambridge to research the biology of financial risk-taking. His work has been published in the Proceedings of the National Academy of Sciences and the Financial Times and been cited in the New York Times, Wall Street Journal, The Economist, New Scientist, Wired and Time.