Facebook Blogging

Edward Hugh has a lively and enjoyable Facebook community where he publishes frequent breaking news economics links and short updates. If you would like to receive these updates on a regular basis and join the debate please invite Edward as a friend by clicking the Facebook link at the top of the right sidebar.

Sunday, July 07, 2002


Every job has its downside, and making and managing money is no different from the rest. What I fail to understand is how people were able to convince themselves there wouldn't be a downside. But it does make you wonder if it is all worth it. Maybe one day they will explain the pro's and con's to the rest of us.

It is hardly surprising that in the current economy, financiers are seeking psychological counseling or pharmaceutical solace. Many firms bring in psychologists as consultants for money managers, but so far the companies do not appear to be ordering their employees to seek help. Some traders, themselves, however, feel the need. Their turn to therapy is a little like struggling athletes who seek out sports psychologists to improve their game. One trader, speaking only on the condition of anonymity, said he went to a therapist to overcome his love/hate relationship to risk.

The trend of seeking therapy springs from two distinct schools of psychology that flourished during the boom. One is behavioral finance, which studies the irrational choices most investors make. Behavioral economists like Richard H. Thaler of the University of Chicago have set up mutual funds based on their insights into market psychology. The other is wealth therapy psychologists like Suze Ormond ("The Courage to Be Rich," Riverhead Books, 1999), who help clients cope emotionally and practically with windfall wealth.

Now that the bubble has burst, investors are not seeking the courage to be poor.

Patients want their heads examined to regain their wealth.Treatment varies. Dr. Geist, the psychotherapist and financial adviser, holds 50-minute sessions with individual clients. Van K. Tharp, a psychologist and "stock-trading coach," who 10 years ago founded The International Institute of Trading Mastery Inc. in the Research Triangle town of Cary, N.C., holds workshops and sells books and tapes. Until he got too busy, Dr. Tharp said, he could do psychological evaluations based on a lengthy questionnaire and a 10-minute phone consultation.
Source: New York Times

No comments: