Deborah Hill Cone: Too much macho spoils the market

Blame testosterone for risk-taking and irrational self-belief. Hang on, isn't that what we need right now? Photo / Anna Crichton

I wonder what Terry Serepisos is doing this very minute? He might be looking at his wardrobe. Or his cars. Or his girlfriends. Or watching old eps of The Apprentice, admiring his handsome mug.

Serepisos is the 47-year-old Greek immigrant who fell from grace this week, going bankrupt and losing his $200 million property portfolio. Whatever he's doing, I doubt he's sobbing into a cup of Earl Grey and reading a self-help book. He is probably boldly planning his next business venture.

Over on the other side of the world, I wonder what Kweku Adoboli is doing right now? He is the 31-year-old Ghanaian immigrant currency trader who fell from grace when he was revealed to have cost UBS US$2.3 billion ($2.9 billion) in rogue trades. Adoboli might be negotiating to sell feature film rights to his big-balls story.

They are both blokes who, I'm guessing, have higher-than-average levels of testosterone. Can anyone think of any women who are in a similar pickle?

New research at Cambridge University, by a man who used to be a derivatives trader, has shown something that most women - whose idea of "trading" is swapping muffin recipes - already know: it all comes down to hormones.

When traders are on a winning streak, their testosterone levels surge, sparking such euphoria that they underestimate risk. Then when they are acutely stressed, they are flooded with the fear substance cortisol. These raging hormones wreck their ability to think rationally.

So although women are traditionally considered to be flaky and impulsive due to their hormones - remember Alasdair Thompson's "period" gaffe? - it could be the other way round. It may be the whole Top Gear-ish macho culture of business that is making capitalism wobble. Maybe it is up to women to step in and save it.

The Economist seems to think so. It suggests one way to reduce financial havoc is for trading desks to hire more women. Women have about 10 per cent as much testosterone as men, making them less prone to irrational exuberance. It says competitive situations do not activate women's cortisol response with such intensity, so market mayhem is less likely to impair their judgment.

What the Economist doesn't say is that everyone has two competing systems in their brain: what some psychologists call the "pause to check" system and the "go for it" system. Women - and highly sensitive men - tend to have a more dominant "pause to check" system. When the financial system was booming, this sort of laid-back temperament seemed to be a liability; businesses wanted gung-ho risk-takers with deep voices and turbocharged "go for it" systems.

But now that the financial environment has become risk-averse, the steadying, cow-like aspects of a woman's temperament seem more appealing.

When the economy is grinding to a halt, slinking away like a scaredy-cat seems more sensible; even the Economist thinks so. But I disagree. That is precisely when you need obnoxious, crazy punters with big cojones and irrational self-belief to generate some action. Come to think of it, there's this guy I know, called Terry, not short of testosterone, who could be available for a new job. Come back Terry, from whichever mirror you're in front of - we need you.