How Wall Street's Men Act Like Menstruating Women


Emotionally volatile, driven by petty personal subplots, captive to hormonal cycles — unfit, in other words, to handle vast amounts of money and determine a chunk of the national economy. We’re talking, of course, about men.

Sheelah Kolhatkar, a journalist who once worked as a hedge fund analyst, writes about the effect of gender on Wall Street in this week’s New York, drawing both on recent endocrinological research and interviews with people on the floor. The conclusion: Not only did a feedback loop of testosterone in the markets help create the financial crisis, men also need to unlearn certain biological tendencies and start acting “like women.”

We’ve heard some of this before, of course, including in New York itself — that egos and competition and greed among groups dominated by men led to recklessness, that risk-averse women may have made less money during the market highs but also survived the crash better, that there may be biological forces at stake. This is perhaps the most explicit synthesis so far of how much traditionally female behavior can go to forestall crisis — and an inversion of the old saw that women are emotional and men are rational.

Body chemistry has been used as a cudgel against women’s advancement so often that relying on it for the opposite aim still feels a little queasy. And yet Kolhatkar cites evidence, both anecdotal and empirical, that spiking levels of testosterone, enabled by ever-quicker techology, led us into this mess. According to one scholar quoted in the piece, “Women having their periods have been shown to act more like men in terms of risk-taking behavior. She adds, “When I present that in seminars, I say men are like women menstruating.”

Another person who has studied the issue, economist Terry Burnham, says that having even a few women around could change that: “Women are the brake pedal.”

Sounds like kind of a buzz kill! What is that traditionally female behavior that breaks through these masses of testosterone-addled men? For one, admitting you might be wrong. One of the most interesting characters in the piece, Doug Hirschhorn, is a “peak performance coach” whose strategy is to make his clients keep a journal and “deconstruct a lot of their testosterone.” He says,

“I don’t think greed is gender specific. But if you ask me whether Long-Term Capital Management would have blown up if there were more women involved in the decision-making process? A woman might have said, ‘Let’s not assume we’ll never be wrong.'”

That’s echoed by a female Goldman Sachs vet: ” “I think generally, women are more likely to admit that they’re wrong, faster.”

It’s harder to admit that something might be wrong when you have a hermetically sealed clique, a mutual affirmation society. Halla Tómasdóttir, a fund manager in Iceland, tells Kolhatkar, “The financial sector was created by men, 99 percent of the employees are men. It was like herd behavior: They all think the same, they’re all from the same school, with the same friends, the same jargon, the same books. You get very unbalanced as a consequence.” Years before her country’s economy collapsed as a result of the heedless behavior of that herd, Tómasdóttir was working on a doctorate entitled, “The Great Big Penis Competition: The Story of Mergers and Acquisitions in Iceland.”

But has any of this evidence been enough to change the fundamentals of how Wall Street works? It will not surprise you that there is not a lot of radical change afoot. Just ask that peak performance coach:

Hirschhorn is peddling his ideas about gender and risk to a number of investment banks. “They could hire twenty elite women and mentor and develop them to become super-traders,” he says. So far, he’s had few takers. “Their philosophy is hire 1,000 men, and if three become rock stars, that pays for the whole model.”

Now that’s some more sound business sense at work.

What If Women Ran Wall Street? [NYM]

Related: Was The Financial Crisis Caused By Hormones? [WSJ]

Earlier: Zoe Cruz Told Mortgage Traders To Cut Losses But They Thought She Was Just High On Crack

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