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

3.88 of 5 stars 3.88  ·  rating details  ·  453 ratings  ·  61 reviews
"A successful Wall Street trader turned Cambridge neuroscientist reveals the biology of boom and bust and how risk taking transforms our body chemistry, driving us to extremes of euphoria and risky behavior or stress and depression"
The laws of financial boom and bust, it turns out, have more than a little to do with male hormones. In a series of groundbreaking experiments
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ebook, 352 pages
Published June 1st 2012 by Penguin Press (first published May 1st 2012)
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(showing 1-30 of 1,787)
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John
An interesting read for someone interested in research study results in psychology, neuroscience and the behavioral effects of hormones. Coates is clearly very familiar with both the world of the trading floor and the science he writes about. I was disappointed, however, in the lack of a real punch line as far as workable strategies to take advantage of these effects to make money in the markets. Male hormones increase volatility. OK, I was convinced of that half way through the book. What good ...more
Nichole Smith
Is there a duck nearby? Because I hear a quack.

In this book, Coates posits that rather than the rational economic beings we like to think make major financial decisions, we are actually driven by physiological impulses much more so than intelligent thought. I'll give Coates props for knowing his biology --but that's about the only redeeming characteristic of this book. First, I'm not sure what is particularly novel about his theory. There's been a lot of attention paid to these issues since 200
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Julian Haigh
"Hormones may build up in the bodies of traders and investors during bull and bear markets to such an extent that they shift risk preferences, amplifying the cycle." Written by John Coates, a neuro-scientist and former Wall Street Trader, it requires no prior knowledge of the subjects and an interesting cross-consideration; that said, it is restricted in depth as a result.

The central premise of the book is that brains and bodies are revealed by modern neuroscience to be far more integrated when
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Mike Scialom
Like war, activity on the trading floor "consists of long stretches of boredom punctuated by brief periods of terror", writes John Coates in The Hour Between Dog and Wolf (Fourth Estate, 20).
What follows is a minute-by-minute analysis of the trader's metabolism which reveals the effects of the euphoria, the stress, the boredom and the heart-stopping moments of hyperactivity where "nature and nurture conspire to produce an awful train wreck, leaving behind mangled careers, damaged bodies and a de
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Andrew Griffith
I read John Coates, The Hour Between Dog and Wolf, another in a series of books on behavioral economics, from the interesting perspective of someone who has been both a trader as well as a researcher. Again, much like other work in this field, such as Thinking, Fast and Slow by Kahneman, largely demolishes the classical economic rational decision-making, as it maps out the linkages between our conscious and unconscious systems. Quote:

"Today Platonic dualism [mind-body divide] … is widely dispute
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Jeremie Averous
This author is a former trader turned neuro-scientist and he explains how stress and hormones drive the behavior of traders, leading to irrational exuberance and well as irrational panic on the markets.

The interesting side of this book is how our physiology is influencing our decision-making, and how it can be contagious in a group. The book describes in minute detail the working of our nervous and hormonal system when we are faced with the stress of modern life.

If there is a proof that the rati
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Celeste Chia
I immensely enjoyed this book. The insights Coates shared were illuminating, especially in an era where people prize logic without knowing the limits of their rationality. It's a shame such findings would hardly be shared in business schools, where theoretical academic knowledge would be conferred instead.
Don
A look at the biochemistry of decision-making behavior in the context of the stock trading floor.
Venky
In this immensely readable book, John M.Coates speculates about the power of physiology on the irrational and conscious acts of man with a specific reference to the fragile and volatile financial markets. As Coates pries out the unseen but unavoidable workings of testosterone and cortisol that manifest in myriad ways, he argues that a thorough understanding of the precision perfect cohesion between brain and body might in the near future,lead to a successful mitigation of risks in a overheated f ...more
Carl Nelson
An essential book for business and much more

Using financial traders as his example of how there is no distinction between our mind and body Coates carefully and clearly explains the biology of decision making and risk taking. And he masterfully argues that understanding the biology of risk taking has clear implications for how risk taking should be managed. For example he argues that Wall Street bonuses should be paid over at the turns of the business cycle instead of annually.
Most importantly t
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Leonidas Kaplan
The hour between dog and wolf: Risk taking, gut feelings and the biology of boom and bust
by John Coates

Let's talk about a story involving a financial manager who goes from seeing the trade that will let him print crazy amount of money, to winning a huge trade, to losing everything, to becoming helplessly lost.

Then we couple this with exactly what is happening in the body as these events unfold. We start with rapid, laser-focused calculations in the brain and body involved in a winning trade.

We v
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Phil
For some unexplained reason, I couldn't wait for this book to be over. I normally enjoy psychology books. And books about the trials and tribulations of investment could possibly be interesting as well. But for whatever reason, I couldn't get into this one. To boot, the author actually uses facts and data to back up his conclusions, which I thoroughly appreciate.

The only thing I can come up with that might have contributed to my lack of interest is that a large nubmer of the examples were ficti
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Uwe Hook
The author is a former trader turned neuro-scientist and he explains how stress and hormones drive the behavior of traders, leading to irrational exuberance and well as irrational panic on the markets.

The interesting side of this book is how our physiology is influencing our decision-making, and how it can be contagious in a group. The book describes in minute detail the working of our nervous and hormonal system when we are faced with the stress of modern life.

If there is a proof that the ratio
...more
Aaron Terrazas
For someone who's pretty familiar with financial markets but not at all familiar with biology, this was a fascinating read. The author describes how the human body reacts to risk taking, victory and defeat through both neurological and endocrine responses, and due to evolutionary biology.

On the downside, I think it could have been shorter and the "recommendations" aren't very compelling. The book might read better if the author had just ended with his research. Overall, however, I was very sati
...more
Kris
Good, quick read. Mixes some interesting trading anecdotes with some neuroscience pretty well, going back and forth between providing examples and explaining. That well-executed interweave is probably one of the best points of this. A lot of the neuroscience was somewhat familiar from related works, such as Kahneman's Thinking Fast and Slow, but there were some interesting new points as well, and some framed in different manners. Also fun to have the trading perspective in there for me.
Brick&rope
There is a great book here somewhere, but this one isn't it. Just when we are starting to get used to the idea of irrationality in human behaviour impacting economic decision making, Mr.Coates goes one level deeper still. Human physiology, and its evolutionary history, he argues, play a key role in expanding asset bubbles in the financial markets beyond rational limits, and play an equally devastating role in markets crashes becoming deeper and longer than they need to be. The basic premise is s ...more
Ted Lehmann
This book goes a long way toward clarifying issues of the mind/budy connection in trading in the financial markets. Implications for management in that world and, more broadly, for understanding our political world in different ways are exciting and challenging. I've posted the review on my blog. http://tedlehmann.blogspot.com/2012/0...
Sophia Dunn
Everyone interested in the current state of global economics really needs to read this book. Written by a neuroscientist, who is also an economist and an ex-Wall Street trader, Coates is uniquely qualified to give us a neurobiogical understanding of how we got into our current situation. It is simply a FASCINATING read.
Mark James
This book is a delightful concoction of the sciences and humanities. Coates dechipers the deeply rooted aspects of human nature and paints a brilliant image on how factors such as stress and exuberance impact the financial world. I would recommend this for any reader , for it has something to offer for everyone.
Laura Kinsale
Gave this 5 stars for the subject matter. Very readable, but mainly this is a topic that REALLY needs some airing. The impact of our biology on our behavior is profound. I've always thought "rational markets" were BS. Very interesting and quite fun to read.
Mike Smith
This excellent book combines several ideas I'd read before in ways I hadn't seen. First is the idea of what Coates calls pre-conscious thought. This is the finding of modern neuroscience that a lot of our "thinking" actually happens instinctively and without our conscious awareness. We evolved in conditions where we sometimes had to respond instantly to shadows in the forest or sudden noises and couldn't afford the time it took to consciously evaluate the threat. There is a whole host of automat ...more
Breakingviews
By Martin Hutchinson

Trading is mostly about neurochemistry. That is the persuasive argument of former trader and current neuroscientist John Coates in his book “The Hour Between Dog and Wolf”. The implication is clear: men have too many of the wrong hormones to be trusted.

Coates believes traders have similar neurochemistry to elite athletes. Like these sportsmen, true short-term traders do not make great use of cognitive abilities, because those reactions are too slow; instead their responses ar
...more
Judy
Pretty creative application of research in both economics and neurobiology, two scientific fields that are generally separate from each other in terms of research questions and experimental models. The author makes the case that high testosterone drives a lot of the risky and/or intuitive leaps the financial trading floor is known for, and that introducing different rewards and motivations might be a step towards making the financial markets less volatile and more rational. While the book is cen ...more
Jenny
Fascinating look at the physiology of risk, as seen through the lens of men and women on a NYC trading floor. Loved the insights the book provided about how our biology (as it relates to risk, uncertainty, winner effects, etc) influences decisions and brain chemistry.
Rebecca Jones
Very interesting diverse well thought out book. Contains some studies personal knowledge a practical real world example of his points. Delves into history biology mythology and finance. Health and wellness and breaks down stress. Engaging and delightful read.
Ju-hyun Kim
합리적인 인간과 감정을 가진 인간. 올해 읽고 싶은 책은 감정을 가진 인간이기에 일어나는 일을 다룬 책들 이었다. 번역판에는 financial risk taking을 재정적 리스크라고 번역이 되어있는데, 타당하지 않아 보인다. 필자가 금융상품의 트레이딩을 해본 경험에서 때로는 용감해지기도 하고, 무모해지기까지 하는 모습을 생물학적인 인간의 모습에서 찾는 것을 보면, 위험감수 이면의 생물학을 이야기하므로 사실은 번역이 정확하였던 것은 아니다. 리스크관리 분야에서는 이런 부분은 "위험선호"로 설명한다.

이책의 가장 큰 장점은 수익을 추구하면서 표정이 변하는 구체적인 투자자의 행동 모습을 그려보게 한다는 점이었다. 위험선호를 거버넌스에서 구현하기 위해서는 이런 모습을 한 번 그려본다는 것이 정말 중요한 것이다.
Josh
Jun 24, 2015 Josh rated it 3 of 5 stars  ·  review of another edition
Recommended to Josh by: David Freitag
This book tries to explain wall street trading in terms of neurobiology.

So, during successful days of trading, traders brains are naturally inclining them towards more risk taking, while major losses cause traders to withdraw and seek to avoid risk. It's obviously more complicated than that, but that's the gist.

Coates also tries to go into instincts and subconscious processing (gut reactions), but there are better examples elsewhere than what he covers.
Justin
Well written book. Brings a new perspective to the behavioral forces that influence or decision making concerning risk and investments.
Tony
Interesting exploration of the effects of biology on Investment Bank traders.
Vaibhav Gupta
one of the most interesting books throwing light on how our biological factors interact with the mind to create the "irrational man" that may have lead to the booms and busts through history.
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How traders are slaves to their hormones and what to do about it? 2 8 May 28, 2012 02:59PM  
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