The Hour Between Dog and Wolf: How Risk Taking Transforms Us, Body and Mind

by John Coates

Under stress we imagine patterns that do not exist. A striking real-life example of this phenomenon is reported by Paul Fussell in his astonishing book The Great War and Modern Memory. Troops living in the trenches during the First World War, under the most unimaginable conditions of fear and uncertainty, were deprived of reliable information about the war because the official army newspaper contained little but inaccurate propaganda. In the absence of reliable information, and in desperate need of it, troops fell prey to rumor in a manner not seen since the Middle Ages—rumors of wraithlike spies conversing with frontline troops before disappearing into the mist; of angels in the sky over the Somme; of a factory behind enemy lines called the Destructor where bodies of Allied soldiers were rendered for their fats; of tribes of feral deserters living in no-man’s-land, preying on injured soldiers. Traders during a financial crisis suffer from an equally wretched vulnerability to rumor and suspected conspiracy. Every bank, individually or collectively, at one time or another is going under; hedge funds, huge ones of course, conspiring to push down the markets; the Chinese dumping Treasuries; the UK defaulting on its sovereign debt; broker suicides. Each rumored catastrophe is now given as much credence, and has as much effect on markets, as hard economic data.